* Sun-Times…
The Chicago Public Schools actually need $596 million to keep schools open the rest of the school year, and not just the $129 million officials have publicly discussed, a top aide to Mayor Rahm Emanuel said Tuesday.
The larger figure takes into account delays in receiving block grants from the state, according to Carole Brown, Emanuel’s chief financial officer.
* WBEZ…
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.
* Mendoza’s spokesperson reacts to the governor’s office statement…
“Like the check bouncer who yells at his bank for bouncing a check from an account he himself emptied, the Governor disingenuously blames the Comptroller for not writing checks from state coffers that Governor Rauner emptied by failing his constitutional duty to propose a balanced budget,” Pallasch said.
Mendoza could probably make that CPS grant payment, but only if she does something like temporarily skip at least part of the next state pension payment (comptrollers have done this from time to time - but that money eventually has to be paid). And Downstate and suburban schools would probably be upset if she does because they’re also not getting their grant money. As we discussed last month, Illinois schools are owed about a billion dollars in grant cash because of the impasse.
* CPS’ predicament…
As of Tuesday, the teachers pension fund said CPS owed it about $716 million. The fund said it expects CPS to pay about $470 million of that tab by June 30, with the rest payable after a quarter-billion dollars in revenue arrives later in the summer from a new property tax devoted to teacher pensions.
Burbridge said the pension fund’s outlook changes if the city falls short on its payments for less predictable reasons, such as a lack of state aid.
* It’s so late in the school year that raising taxes wouldn’t bring much money into the CPS coffers. And any cuts made this late would have to be several times larger than they would’ve been had they been made at the start of the fiscal year because there is so little time left…
Other possibilities include: taking a “bridge” loan from tax-increment financing districts that might never be repaid; another round of borrowing; more cuts of school support staff; delayed payments to CPS vendors; and a request to the Chicago Teachers Pension Fund to delay part of the $721 million payment that’s due June 30.
A 60-day delay on the pension payment would solve some of the cash-flow issues since tax revenue typically rolls in by August.
* If Mendoza won’t delay state pension payments to help out CPS, then CPS might have to delay its own payment. The ratings agencies will certainly be furious, but the district already has junk bond status…
Brown on Tuesday acknowledged officials have discussed withholding the pension payment as they test ideas with bond rating agencies to see which would do the least additional harm to the district and the city’s already low bond ratings.
“It’s an option that we’ve talked about, but it’s not an option that anybody’s concluded is something that’s viable, or an option that anyone’s concluded is the preferred course of action,” she told the Tribune.
*** UPDATE *** Sun-Times…
On Wednesday, Emanuel was asked why he waited so long to reveal the magnitude of the problem from aldermen whose support he needs for a financial rescue that could put the city’s own shaky finances at risk.
“The bills kept climbing and growing and, in every aspect, they said they were gonna get current with it. … The state of Illinois is the largest deadbeat in the state of Illinois,” the mayor said.
“We’ve never shied away from doing what we need to do. And we paid our bills on time. … I will meet the challenge. We will work together and work through this issue. [But] it is adding insult to injury not only to be dead last in funding education, but then to be behind on your payments so dramatically that you’re affecting the ability of us to keep moving forward academically.”
After canceling two closed-door briefings with aldermen, Emanuel shed no new light on the rescue plan. He would only reiterate Brown’s statement that “everything is on the table” and that, even another tax increase or reinstating the head tax he proudly eliminated has not been ruled out.
- Ron - Wednesday, May 10, 17 @ 8:37 am:
What happens when CPS inevitably defaults?
- Earnest - Wednesday, May 10, 17 @ 8:52 am:
>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
More and more, I picture that old Family Circus one-panel comic when I see these from the governor’s office. Mom is looking at Billy and pointing at a broken lamp. The caption reads “Not me.” Then in the back of the frame there’s a little clone of Billy wearing a “Not me” t-shirt and sneaking away.
If I could make a requests, could all the candidates of both parties use shirts like that instead of chicken or Squeezy costumes this election season? The shirt will work for pretty much whomever you’re running against.
- JTF - Wednesday, May 10, 17 @ 9:10 am:
While acknowledging that Rauner did not create CPS problems, I’m always still shocked (I say) by the blatant false and misleading statements from the Governor’s Office. You have to be a true zealot to your cause to put out disingenuous statements like that and sleep well at night.
- wordslinger - Wednesday, May 10, 17 @ 9:12 am:
When Citizen Rauner was contributing hundreds of thousands of dollars to Daley and Emanuel, he specifically cited their education policies as his motivation.
He was quite the enabler of those “decades of mismanagement.”
Of course, he was hustling government business at the time, so that might have had something to do with it, too.
- JS Mill - Wednesday, May 10, 17 @ 9:18 am:
=What happens when CPS inevitably defaults?=
First, it is not inevitable. That is simply a canard.
Which begs the question..what if CPS does not “default”?
Non PTELL district’s bond rate is an “uncapped” fund. Meaning they can raise the rate to what ever level is required to pay the bonds.
I am not sure how it works for CPS though since they operate under a completely different set of rules even though Cook County is a PTELL county.
I would guess they can raise that bond rate, but that is a guess. I am sure that political realities would make that difficult.
If the state were making it’s normal payments to schools, CPS would probably not be in such dire straights (like many other schools in the state).
- City Zen - Wednesday, May 10, 17 @ 9:33 am:
CPS has never met a block grant they didn’t like.
- JS Mill - Wednesday, May 10, 17 @ 10:37 am:
=CPS has never met a block grant they didn’t like.=
Unless they thought they could get more money some other way.
CPS wants more money, the block grant benefits CPS far and above what they would receive if they were in the funding formula that all others are subject to is now “bad” (?) i guess.
- Rod - Wednesday, May 10, 17 @ 10:48 am:
Ron nothing of significance if CPS does not make its full payment. The pension fund can litigate against CPS for the balance due, but likely by the time the litigation process gets too far CPS will likely pay the balance plus interest. Until the holders and issuers of CPS debt cut off CPS the game will continue.
- From the 'Dale to HP - Wednesday, May 10, 17 @ 10:52 am:
[whispers] …and this is why Rauner won’t go along with Grand Bargain2.0… [/whispers]
- Chicago Schooler - Wednesday, May 10, 17 @ 10:59 am:
=CPS has never met a block grant they didn’t like.=
CPS would trade its extra block grant for the same pension subsidies given to the rest of the state– any day. They’d come out ahead in that trade by about $500 million.
The one thing that came out of the recent lawsuit is the State failing to contest the numbers–CPS gets far less than Districts in the rest of the state on average, and its because they make a $700 million plus pension payment that no other district in the state has to make.
- Anonymous - Wednesday, May 10, 17 @ 11:04 am:
The fairest thing to do is have all school districts pay the pensions of their teachers.
And allow municipal BK
- JS Mill - Wednesday, May 10, 17 @ 11:45 am:
=CPS would trade its extra block grant for the same pension subsidies given to the rest of the state– any day. They’d come out ahead in that trade by about $500 million.=
If they have a vague concept of math they wouldn’t make that trade.
The pension pick up is $215 million.
The block grant exceeds $500 million.
- City Zen - Wednesday, May 10, 17 @ 12:11 pm:
JS Mill is the RNUG of CPS block grant funding.
CPS has enjoyed a ginormous windfall over the decades from those block grants. By windfall, I mean they got more than their fair share with minimal accountability.
For those still in denial, this Trib article gives you a glimpse into just one aspect of the block grant and how nebulous CPS treats it:
http://articles.chicagotribune.com/2009-11-22/news/0911210296_1_chicago-public-schools-special-education-mayor-richard-daley
“Every other district has to go through this big process — giving the Social Security numbers of all special education teachers, showing the hours that they’re teaching, where they are teaching…CPS doesn’t have to do any of that. There’s no accounting. They don’t even submit a list to the state of Illinois of who these teachers are.”
“Koch pointed out that enrollment at Chicago Public Schools has gone down with the city’s population since that percentage was established more than a decade ago, raising questions about whether the percentage remains equitable. He said the state board has a task force examining Chicago Public Schools’ block grant funding.
- Zatoichi - Wednesday, May 10, 17 @ 12:36 pm:
So the total dollars is now $596M not $129M? Where did this extra $470M suddenly appear from? Missing page in the ledger?
- Rich Miller - Wednesday, May 10, 17 @ 12:53 pm:
Zatoichi, it’s all explained above. Try reading more than the first sentence.
- zatoichi - Wednesday, May 10, 17 @ 1:21 pm:
Rich, I read that and understand. This new total did not simply pop from nowhere. These dollars have existed while the smaller total was being used as a talking points.
- Rich Miller - Wednesday, May 10, 17 @ 1:24 pm:
===This new total did not simply pop from nowhere===
Sigh. It’s the late payments from the comptroller.
- winners and losers - Wednesday, May 10, 17 @ 1:47 pm:
==CPS doesn’t have to do any of that. There’s no accounting. They don’t even submit a list to the state of Illinois of who these teachers are.==
SB 1 and HB 2808 would make that true for ALL school districts in Illinois.
Special education accountability? Not in SB 1 or HB 2808.
- JS Mill - Wednesday, May 10, 17 @ 2:58 pm:
=SB 1 and HB 2808 would make that true for ALL school districts in Illinois.
Special education accountability? Not in SB 1 or HB 2808.=
The current accountability, especially for special ed, does not go away. MoE is a federal requirement as is IDEA.
You really need to understand what you are talking about. You seem to ignore or be completely unaware of state regulations.
- winners and losers - Wednesday, May 10, 17 @ 3:10 pm:
==The current accountability, especially for special ed, does not go away. MoE is a federal requirement as is IDEA.==
I regret to say that I know much more about special education law and regulations than JSMill seems to know.
Maintenance of Effort (MOE) is about total money spent - nothing to do with student accountability.
IDEA, the Federal special education law, sets a minimum standard.
JSMill - Are you aware when Illinois got a law requiring special ed? Where and how did Illinois come to require RTI? For which students? For how long a time?
Unfortunately too many school superintendents think they know it all.
- Reformed Public Servant - Wednesday, May 10, 17 @ 3:48 pm:
Anyone curious to see what happens in IL without the order and structure of Ch. 9 bankruptcy? Watch CPS in the coming weeks… Collateral contagion from CPS to Chicago to …
Maybe JBPritzker can personally bailout CPS? The unearned media would vastly exceed any ads for the money.
- Ron - Wednesday, May 10, 17 @ 4:15 pm:
Reformed, I agree. I still don’t understand why so many here are opposed to bankruptcy.
Are these people opposed to personal bankruptcy?
- JS Mill - Wednesday, May 10, 17 @ 4:25 pm:
@Winners- I know that I do not know it all. But you don’t know much of anything.
If you don’t know what accountability measures are I can’t help you. There are multiple types and none are being eliminated. You don’t seem to get that.
It is clear you don’t support the EBM , I have no problem with that. But when you spread false info I have an issue with that. There are many accountability components.
And your are posting false info.
- Demoralized - Wednesday, May 10, 17 @ 4:26 pm:
==I still don’t understand why so many here are opposed to bankruptcy.==
Probably because we’re not as giddy as you about seeing someone’s pension taken away from them, which is your real motive to allow municipal bankruptcy.
==Are these people opposed to personal bankruptcy?==
Yeah, because the two are comparable. lol
- winners and losers - Wednesday, May 10, 17 @ 5:37 pm:
==I know that I do not know it all==
JSMill - That was the only true statement in your last email.
Your facts are as bad as your English ((And your are posting false info.))
Hopefully you know more about general education than you do about special education. (NOTE: You did not answer any of my questions as it would take real knowledge of special ed to do so.)
- JS Mill - Wednesday, May 10, 17 @ 7:07 pm:
=JSMill - That was the only true statement in your last email.
Your facts are as bad as your English ((And your are posting false info.))=
Since we are being so pedantic- it was a post on a blog thread not an email. Lol!
But wow, that is the best you can do? You got me, I missed the “your” instead of “you.”
Your question, or quiz is asinine. If I didn’t know it, I know where to find it.
The fact is that RtI, instructional services, special ed are requirements and accountability are absolutely unaffected by the EBM.
The statutory accountability requirements relating to instruction, staffing, services (LRE etc, and finances are still in effect under the EBM. It is a funding model that uses research and desired outcomes to create a recommendation for what programs and services should look like (based on goals) and then attempts to create a framework to properly fund it.
The plan has always been to link it with the balanced accountability model. There is no language that proposes to dilute accountability in place already.
Because it does not fund services except low-incidence high-cost special education as a categorical grant, the simple minded cannot wrap their head around it.
You absolutely don’t understand that as you continue to shriek about lost accountability.
Find a statute or proposal related to the EBM that eliminates any of the accountability? I would pack a lunch, because you will be looking fruitlessly because it isn’t there.
So again you need to get a grip. The EBM actually funds special ed instruction Better then the current misfit of a model. If you did the research you would understand that.
BTW- Rti is NOT a special education initiative, it is a regular education initiative. If you knew as much as you thought, you would know that much. Maybe you should do some work on that instead of making sad little remarks about grammar. Especially when you cannot tell the difference between a blog post and an email.
peace
- Arthur Andersen - Thursday, May 11, 17 @ 12:27 am:
Mendoza should keep going until she has the entire $50 million Frank “Small Businessman” Vala got paid early by the wingman and send that to CPS.