CPS budget deficit leaves district with tough options
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Chicago Public Schools needs hundreds of millions in extra funding to cover basic costs in the next school year, but officials can't agree where to find it.
Why it matters: Various options on the table could end up hurting taxpayers, school staff, the district's credit rating and even students in other parts of the state, leaving no perfect solution.
Catch up fast: When the school board passed its $9.9 billion budget in late July, it did not include — against the wishes of Mayor Brandon Johnson — $175 million for non-teacher pensions or money for a new Chicago Teachers Union (CTU) contract.
- The move sparked speculation over whether Johnson would force CPS CEO Pedro Martinez, who supported the new budget, or any board members to resign.
- Since then, several alders and former CPS leaders have backed Martinez, while Johnson is getting support from the CTU, which bankrolled his campaign. Board members are remaining mum.
Zoom in: Three funding options — state dollars, high interest loans and property taxes — are on the table, but each faces strong pushback.
- Here's a look at the pros and cons of each.
More state money: Johnson asked state lawmakers last spring for a billion additional dollars to fully fund the district — an amount he reached based on the state's own formula for fully funding schools.
Reality check: The 2025 state budget granted just a fraction of the ask, with Gov. JB Pritzker explaining, "Chicago is 20% of the population of the state. … We have a lot of other kids across the state. … We need to fund their schools better too," Chalkbeat reported.
High interest loans: Johnson unsuccessfully pushed the board to borrow $300 million to fund the pension and CTU contract and has been lobbying for a budget amendment.
- The board declined to vote on the issue at its last meeting.
Reality check: The board, Martinez and nonpartisan watchdog Civic Federation say the loan would further hurt the district's shaky finances and "lead to a larger deficit next year."
- One CPS memo obtained by the Tribune said the loan would cost taxpayers $434 million over five years and grow the 2026 budget deficit to $951 million.
Property tax hikes: Property taxes represent CPS' largest revenue stream and are on target to total $3.8 billion for FY 2024. That figure has quadrupled since 1991, according to a Civic Federation analysis.
Reality check: Homeowners, including some in rapidly gentrifying Pilsen, say property tax hikes are driving them out of their homes and they can't afford more.
The intrigue: If officials can't find more revenue, program cuts and furloughs could be on the table, according to documents obtained by WBEZ.
Reality check: Johnson's office told WBEZ that his "vision for public education calls for investments in our students — not layoffs, cuts to classrooms or other harmful school actions."
- And cuts could potentially trigger a teachers strike.
The bottom line: The money has to come from somewhere.
What we're watching: How CTU-CPS contract negotiations proceed in this fraught environment.
- How Johnson's city budget address, delayed by two weeks to Oct. 30, addresses both the city and CPS' money woes.