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Chicago Public Schools is putting together a roughly $10 billion budget for next school year that relies on getting more money from the city or state. But neither entity has committed to the funding, and critics call the plan unrealistic.
In a call with reporters on Wednesday, district officials said that while individual campuses could see changes based on enrollment, the total amount of funding that goes to its roughly 600 schools would stay the same as last year — for now. Principals are slated to get their school’s budgets on Thursday but could see changes and cuts over the summer if new revenue doesn’t come through. The principals union sent a letter to members Tuesday calling the anticipated budgets “magical” and “false,” as first reported by WBEZ and the Chicago Sun-Times.
“If it changes, then that’s going to have a multitude of ripple effects throughout the district, throughout the communities,” said Tyrone Dowdell, the longtime principal of Green Elementary School in Washington Heights and a board member of the principals union. “I don’t want for any of our colleagues throughout the city to have to change and tell their Local School Councils something different from what they say in May.”
Last month, district officials privately told the Chicago Board of Education CPS is expecting a $529 million deficit, which it could close by cutting up to 1,700 school-based positions, Chalkbeat previously reported.
At the time, the district also laid out two other scenarios: one in which the district’s deficit grows because of additional costs, and one where the deficit shrinks because CPS gets more money. The latter of those two scenarios is what the district is proposing: A $229 million deficit with the assumption that the city or state will come up with an additional $300 million for CPS.
Under that scenario, CPS will still need cuts to balance the budget but could keep them away from schools, officials said. CPS has not yet finalized what those cuts would be but is “confident” it will find “reductions and efficiencies,” said CPS spokesperson Mary Ann Fergus. The district closed last year’s roughly $500 million deficit with a mix of cuts to central staff and administrative costs, but kept overall funding to school budgets level.
With both the city and state grappling with their own deficits, CPS’s hopeful outlook is unlikely to come to fruition.
How the budget deficit gets addressed may depend on who replaces current CPS CEO Pedro Martinez, whose last day is June 18. The district’s new fiscal year starts July 1; the Board of Education has historically voted on a budget in June or July.
Martinez advocates for more city funding
The district’s budget calculations include different possibilities, including getting $600 million from the city related to Tax Increment Financing, or TIF, districts, or double what CPS received last year in TIF-related funds.
Additionally, CPS did not budget for a pension reimbursement to the city — setting up another potential fight with City Hall.
Martinez said Wednesday the budgets going to principals Thursday represent what the school board, unions, and Mayor Brandon Johnson want: no cuts to schools. District officials touted adding hundreds of staffers and new investments funded by federal COVID relief money, such as extra help for struggling students. A 2024 Chalkbeat analysis found those one-time COVID relief dollars, which have now run out, helped support roughly 7% of school budgets annually over the past four years.
The district has been asking the state for more money over the past year, Martinez said. If TIFs didn’t exist or were allowed to expire when they’re supposed to, Martinez said, the district would be getting at least an additional $600 million annually.
TIFs are special taxing districts that last for at least 23 years and set aside a portion of property taxes in that specific area to help spur development and improve public amenities, including parks and schools. Surplus money that’s not earmarked for projects goes back to the local taxing bodies, including CPS, which gets roughly half. When a TIF expires, the property value goes back to the tax base, benefiting government entities like CPS.
Martinez said if the city dissolved existing TIFs now, CPS would be able to solve its budget problems. Dissolving a TIF early, however, requires City Council approval, which school board President Sean Harden said is a “steep hill” to climb.
Nevertheless, Martinez said he’s encouraging the mayor, the City Council, the school board, unions, and families “to unite around a plan to use TIF funding to close our budget gap and supply our district with sustainable revenue for the future.”
“This is the only scenario that will allow us to maintain school funding levels,” he said.
The mayor’s office did not respond to a request for comment.
Critics call the potential budget plan unrealistic
Harden, who was appointed by the mayor, told Chalkbeat that CPS may also be in a weak position to press the city for more money after refusing to reimburse the city for a portion of CPS-related pension costs. That reimbursement is not legally required, but the district had previously made the payment, starting under Mayor Lori Lightfoot. Doing so this year would have required borrowing or cuts and an inability to afford labor contracts, district officials argued.
Additional revenue is not likely to be coming from the state legislature either. Some school board members have said they’ve gone to Springfield at least twice this year to advocate for more funding. District officials also went at the end of April.
“Any proposal that assumes revenue from the city, state, or any place else, the board would want to see the basis for that assumption,” Harden said.
Joe Ferguson, president of the Civic Federation, a nonpartisan government watchdog group, said the district’s budget plan so far appeared to be a pressure tactic on the city and the state to send more money that is unlikely to materialize. What CPS revealed Wednesday is more of a “tactical document for negotiation” that doesn’t allow principals, schools, and parents to “begin to plan for the coming school year,” Ferguson said.
Martinez rejected the idea that he is making a political move or that it is irresponsible.
“I think it’s irresponsible to force our schools to cut a significant number of staff … I think it’s irresponsible to have over $1.2 billion every single year coming into the city that taxpayers think are going to the taxing bodies, and they are not,” Martinez said, referring to revenue generated by TIFs. “I think it’s irresponsible to propose tax increases at the city level when you have this much money.”
Reema Amin is a reporter covering Chicago Public Schools. Contact Reema at ramin@chalkbeat.org.
