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Chicago Public Schools will get $193 million more in tax revenue than was included in this year’s $10.2 billion budget after the City Council passed its own budget Saturday, declaring a $1 billion surplus Saturday from city tax increment financing districts.
But the additional dollars will not result in a windfall for classrooms as the school system continues to adjust spending, eliminate vacant positions, and account for increased interest payments on debt.
The TIF surplus amount is unchanged from what Chicago Mayor Brandon Johnson proposed in October. By law, CPS gets a little over half of any TIF surplus declared by the city. City budget documents released in October said the school district would get $552.4 million, which is $193 million more than the $379 million the school board budgeted to get from those special taxing districts, known as TIF.
Johnson said Tuesday he would not sign the budget plan, but he would not veto it either. That means it will automatically go into effect at the start of 2026.
This is the second year in a row Johnson faced a significant budget battle with the City Council. This year, dozens of aldermen presented an alternative budget after voting down Johnson’s in late November. Facing an end-of- the- year deadline, the alternative budget plan passed Saturday by a vote of 30-18.
During a press conference at City Hall on Tuesday, Johnson expressed strong opposition to some elements of the alternative budget’s plan, particularly a move to sell off debt owed to the city. While he considers some elements of the budget “morally bankrupt,” he applauded other elements, including the TIF surplus.
“We added the largest TIF surplus in the history of the city to go to our schools, our parks, our libraries,” he said. “These investments create spaces for our young people to grow and thrive and keep our city safe.”
A coalition of school board members aligned with Johnson put out a statement after the City Council vote that thanked aldermen for not changing the TIF surplus but criticized them for not supporting the mayor’s proposed corporate head tax.
A significant chunk of the additional money — $175 million — is expected to go back to the city as a reimbursement payment to cover a portion of municipal pension costs for CPS non-teaching staff retirements.
That leaves roughly $18 million for the school district to use.
However, the district’s budget approved in August required officials to identify an additional $50 million in cuts. A CPS spokesperson said in recent weeks the district eliminated 69 vacant positions from 19 central and citywide departments, extended an ongoing hiring freeze at the central office , cut some professional development for teachers, and made additional cuts to central office expenses, saving about $34.4 million.
The district also said it found savings elsewhere, including through its Summer Bridge program which was offered at fewer schools this year, according to the spokesperson. The district estimated it saved $15.6 million through these and other measures.
No employee was laid off, and there are no planned cuts to “student-facing” programs for the second semester, another spokesperson said.
Other unexpected expenses have come up since the district passed its budget in August.
In September, the federal government cut millions in magnet school grants citing CPS’s diversity initiatives, which left an $8 million unexpected hole in this year’s budget.
And last week, WBEZ reported Chicago Public Schools is spending $23 million more than usual to cover interest payments on loans it routinely takes out to cover payroll and other expenses while waiting for Cook County to send tax revenue to government bodies.
Becky Vevea is the bureau chief for Chalkbeat Chicago. Contact Becky at bvevea@chalkbeat.org.
Reema Amin is a reporter covering Chicago Public Schools. Contact Reema at ramin@chalkbeat.org.
