Budget & finance

2026 will bring fresh budget issues and school board elections in Chicago, while Illinois leaders may have to grapple with a significant loss in federal child care funding.

District officials are asking the board to increase the amount of cash flow borrowing to $1.65 billion, adding another $6 million in short-term borrowing costs.

The funding increase would be in line with past years but doesn’t keep up with inflation and comes as the state is facing a major deficit.

Chicago Board of Education members held a rally outside of Austin High School to urge city officials to vote in favor of Mayor Brandon Johnson’s $16.6 billion budget proposal. Members warn there could be staffing cuts if the plan is voted down.

The district’s inspector general issued a special report flagging lax travel spending oversight and excessive professional development trips.

The agreement makes the payment contingent on receiving $552.4 million in surplus tax funds proposed by Mayor Brandon Johnson.

In a potentially final bid to whip up support for its budget, CPS officials said the desire to reimburse the city for a much-debated pension payment and taking out a $200 million loan would result in cuts to schools and a credit downgrade for the district.

Chicago Mayor Brandon Johnson and interim CPS CEO Macquline King rang the ceremonial first bell to mark the 2025-26 school year on the playground of Courtenay Language Arts Center.

The Chicago Board of Education is split on the district’s budget proposal for next school year. A group of mostly appointed members has asked CPS to alter its proposal that it includes a much-debated pension payment and loan.

Chalkbeat spoke to budget watchdogs, municipal finance experts, district officials, school board members, the teachers union, community groups, and civic organizations about possible solutions for Chicago Public Schools’ budget crunch.

Due to a drop in local tax revenue and a bump in English learner enrollment, Chicago Public Schools will receive an additional $76 million from the state. Earlier this year, district officials anticipated a $25 million increase from the state.

CPS will cut seven private custodial contracts, resulting in the loss of 480 full-time custodian jobs. The move is estimated to save $40 million.

Mayor Brandon Johnson, as well as CPS and Chicago Teachers Union officials, hailed the initiative’s expansion even as they acknowledged the fiscal pressures that could endanger it.

State lawmakers said they’re ready to collaborate with the Chicago school board to find funding solutions, but did not commit to a special session or additional education funding.

Board of Education President Sean Harden said borrowing money could be a short-term fix to avoid “draconian cuts” to schools.

More than 1,450 staff at schools were laid off Friday. Budget documents posted online indicate the school-based workforce could shrink by more than 450 positions.

CPS owes teachers retroactive raises for last school year and could be making more school-based cuts this month as it works to close a gaping deficit.

Congress approved the support for English learners and afterschool programs. But the dollars expected on July 1 are now on hold, creating ‘unnecessary uncertainty,’ Sanders says.

Reductions target crossing guards and central-office employees. Trimming a $734 million deficit would require bigger moves.

The district is putting together a budget for the 2025-26 school year with no cuts to schools, but the proposal may not come to fruition.