* Sun-Times…
Outgoing Chicago Public Schools CEO Pedro Martinez and his team are moving forward with a precarious budget for next school year that is based on $600 million that is not lined up — a move that could result in thousands of teacher and support staff layoffs this summer or even mid-year.
The principals’ union and the mayor’s office blasted Martinez, saying that he is putting politics above the needs of students. Principals are expecting to get their school-level budgets on Thursday, but the Chicago Principals & Administrators Association called those budgets “false” and “magical.”
School Board President Sean Harden also criticized Martinez last week for presenting the board with “unsatisfactory and incomplete” budget options. Harden called for Martinez, who has been terminated with an end date of June 19, to step aside immediately.
The school-level budgets assume a best-case scenario in which the city gives CPS $300 million in surplus from special taxing districts called TIFs, and either the state or the city come up with an additional $300 million. Both the city and state are cash-strapped and are not planning any big boost in revenue for CPS. Last year, the city gave CPS a record $298 million in TIF surplus funds, but it was based on the premise that the school district would cover a $175 million municipal pension payment. Martinez rebuked the mayor’s demand that CPS pay it.
* Tribune…
Martinez argued that over $1.2 billion in property taxes are diverted from CPS every year, depriving the district of over $600 million in revenue.
Aldermen are in charge of allocating TIF money in their districts. When they decide they don’t need all the extra property tax money, some of the extra TIF funds are returned to CPS, called the TIF surplus. In recent years, the district has received tens of millions of dollars that way.
Martinez made a similar plea to aldermen last year and received a record amount of $311 million when the city settled its budget over the winter. But Chicago’s City Council faces its own fiscal challenges in the upcoming budget season.
And the $529 million shortfall already assumes $300 million in TIF surplus.
Another unresolved issue is a $175 million pension payment for non-teacher staff, a cost the city used to cover but has now shifted to the school district. CPS punted that responsibility back to the city this year.
* Chalkbeat Chicago…
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. […]
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.”
* ABC Chicago…
“We are ultimately the face of the district’s decisions, and our students deserve better,” said Kia Banks with the Chicago Principals & Administrators Association. […]
“To give us a budget… without a commitment that that budget will be fully funded, I think is very irresponsible,” Banks said.
By law, the Chicago Board of Education has to vote on and pass a balanced budget. That vote will likely happen sometime in August.
The problem is likely to fall to Martinez’s successor. His last day on the job is June 18.
Thoughts?
- NotRich - Thursday, May 15, 25 @ 10:26 am:
One of many reasons why a 3rd term will be treacherous for JB. The Mayor and Stacey will blame JB for all the layoffs.
- Joseph M - Thursday, May 15, 25 @ 10:38 am:
The 2027 school board election can’t come soon enough. I’m fearful of a post-Martinez CPS that has basically zero checks and balances.
- low level - Thursday, May 15, 25 @ 10:44 am:
== The Mayor and Stacey will blame JB for all the layoffs.==
Yes but it wont work. The Governor has credibility when it comes to budget / fiscal matters. The mayor and SDG do not.
- TNR - Thursday, May 15, 25 @ 10:55 am:
== The Mayor and Stacey will blame JB for all the layoffs.==
SDG is lucky her reelection as union boss is tomorrow, coming off a new contract, and not this time next year after a round of layoffs rips through the district.
- Andersonville Right Winger - Thursday, May 15, 25 @ 11:13 am:
The Chicago Teachers Union lost its motion to dismiss the lawsuit seeking an audit.
- City Zen - Thursday, May 15, 25 @ 11:13 am:
==it’s irresponsible to propose tax increases at the city level when you have this much money==
Looking to the state for a bailout when the school disitrct leader readily admits the money is already there locally? Bold.
- Steve - Thursday, May 15, 25 @ 11:19 am:
Since there’s no talk of shutting anymore schools or other budget cuts, higher property taxes seem to be an option.
- Three Dimensional Checkers - Thursday, May 15, 25 @ 11:45 am:
I guess MBJ and SDG expected Pedro to propose layoffs, so they could try to pin all the blame on him after he leaves. They also want him to do their homework, put money in their pocket, and go to prison for them when it all blows up in their faces. Reasonable.
- Donnie Elgin - Thursday, May 15, 25 @ 12:16 pm:
=the school disitrct leader readily admits the money is already there locally=
The money may be there, but it is not allocated to CPS. A big distinction.
- JS Mill - Thursday, May 15, 25 @ 12:18 pm:
=I guess MBJ and SDG expected Pedro to propose layoffs, so they could try to pin all the blame on him after he leaves. They also want him to do their homework, put money in their pocket, and go to prison for them when it all blows up in their faces. Reasonable.=
Exactly.
- 40,000 ft - Thursday, May 15, 25 @ 12:42 pm:
From the distance of 40,000 ft, so many of these folks just don’t impress me with a grasp of basic facts and reality.
It would help if they acknowledged basic things like cash flows, achievement scores, costs per pupil, and the like. This latest round comes across like a double-down on delusions.
btw, I figured out a prudent theory as to why Axelrod wants Pritzker to not run for another term… Axelrod is probably Team Rahm and needs a foil.
- The Farm Grad - Thursday, May 15, 25 @ 1:07 pm:
“The money may be there, but it is not allocated to CPS. A big distinction. ”
40% of Chicago’s operating budget is allocated to Pensions+RetireeHealthBenefits+InterstOnDebt.
Of the remaining 60%, where should the money be Reallocated from?
- DuPage Saint - Thursday, May 15, 25 @ 2:05 pm:
I do not have much faith in CpS but I think they have a point about TIFs . Those districts just seem to be one big slush found and that is not exclusive to Chicago
- low level - Thursday, May 15, 25 @ 2:44 pm:
What is incredible to me is how so few people understand Tax Increment Financing. The piece they all seem to miss is how bonds are issued for capital improvements that are made within the boundaries of the TIF. The increased tax collections then pay those bonds. Without TIF, those improvements would have to come from the Corporate Fund or some other source. Its only when that debt service is satisfied that a surplus can be declared and used.
- Google Is Your Friend - Thursday, May 15, 25 @ 3:37 pm:
- Joseph M - Thursday, May 15, 25 @ 10:38 am:
==Outgoing Chicago Public Schools CEO Pedro Martinez and his team are moving forward with a precarious budget for next school year that is based on $600 million that is not lined up==
This is the guy acting as a check? LOL! Pedro hasn’t changed his CFO days when CPS issued more variable rate debt than any school district in America. He’s Mr. Irresponsible, no matter what the theater critic at the Tribune screeds in an editorial.