Chicago Public Schools now likely needs nearly $600 million to stay open the rest of the school year because the district has yet to receive a block-grant payment that it had expected from the state, according to one of Mayor Rahm Emanuel’s top aides.
CPS already is facing a $129 million budget hole created in December when Gov. Bruce Rauner vetoed a bill that would have provided $215 million toward Chicago teacher pensions. CPS has since slashed school budgets and imposed furlough days for its staff to close that gap. CPS owes a $720 million teacher pension payment on June 30.
Carole Brown, the city’s chief financial officer, said Tuesday that CPS has yet to receive $467 million in block grant payments.
“We are hopeful that money will come in, but…as we put forth ideas to get through the end of the year, we have to consider what if that money doesn’t come in,” she said.
A spokesman for Illinois Comptroller Susana Mendoza said it is unlikely CPS will get that grant money before June 30. The state is six months behind on payments because of the budget impasse in Springfield.
The governor’s office responded with a statement saying that “CPS’ crisis is not due to the budget impasse, it’s due to decades of fiscal mismanagement. Any outstanding payments from the state lie with Comptroller Mendoza, and can be processed when her office chooses.” CPS, though, said the governor’s office only has approved $300 million of the $467 million in payments due to CPS.
Brown said the first priority is to solve for the $129 million budget hole. She said “everything is on the table” — including raising taxes — to fill that gap.
But Brown didn’t give specifics on Emanuel’s plans, and some aldermen have expressed frustrations about being left in the dark after the mayor delayed a second meeting on the subject scheduled for Tuesday.
Brown told reporters the mayor’s financial team would “take the time we need” to figure out how to fill the gap. But the CPS fiscal year ends on June 30, and Brown said the city will need to come up with a solution before then.
The lack of public plan has frustrated some aldermen, who were supposed to meet with the mayor’s office twice to discuss those potential funding options. Both meetings were cancelled.
Ald. Carlos Ramirez-Rosa (35th Ward) called it “utterly ridiculous” that the mayor’s office pushed off CPS funding briefings with aldermen for the second time this month.
“The mayor, up through today, has failed to provide us with details of his plan,” Ramirez-Rosa said Tuesday. “So there either is no plan, or the plan is something so atrocious, that he’s keeping it close to his chest.”
Brown said the cancellations came because the timeline was “a manufactured one.”
“What we are working toward is trying to come up with a solution that adequately fills the hole created by the governor’s veto and funds schools throughout the end of the year,” she said. “We want the right solution, not the most expedient solution.”
Rauner has said he vetoed the bill authorizing the pension payment because it was contingent on passage of state pension reform, which didn’t happen.
In light of the latest cancellation, Ramirez-Rosa gathered a coalition of community groups, including the Chicago Teachers Union, Brighton Park Neighborhood Council and Northside Action for Justice, to publicly present their own funding ideas for CPS: bringing back a corporate head tax and declaring annual surpluses in special taxing districts, known as TIF districts.
Ramirez-Rosa said he believes the city can find $125 to $140 million in TIF surplus money annually, and could bring in $106 million from his corporate head tax plan. Both plans are sitting in separate City Council committees.
While Emanuel eliminated a corporate head tax in his first term, Brown told reporters the mayor’s office isn’t ruling anything out.
“Part of the challenge in coming up with a solution is that everything is on the table,” Brown said.