Let me start by saying I know nothing about this problem, other than what the DUmmy posted, and frankly, I have no intention of looking any further.
Anyway, my immediate take was a bit different.
Could it be that the teachers had a 'Cadillac' plan, one that will require higher payments under the ACA, and when the teacher's union was presented with that, they said 'no.' - and expected the town to cover the difference ?
Since the town saw no need to force everybody else to pay for the teachers, they did what happens every time union demands outstrip what the business owner (in this case, the town) is willing to pay ?
They closed the shop.