For the first time since 1995 Chicago Public Schools must empty its reserve fund to balance its proposed 2011 budget of $6.4 billion, CPS officials said.
For the first time since 1995 Chicago Public Schools must empty its reserve fund to balance its proposed 2011 budget of $6.4 billion, CPS officials said.
Ron Huberman, chief executive officer for the nation’s third largest school district — 409,000 students and 675 schools — recently met with the media to discuss his proposed budget. It was during the meeting that Huberman outlined and explained his proposed budget for a school district whose students consist of 45 percent Black, 42 percent Latino, 9 percent white, 4 percent Asian/Pacific Islander, and 0.2 percent Native American.
By comparison CPS’ budget is larger than the $6.3 billion Chicago Budget Director Eugene Munin estimated in July for 2011. This year’s proposed CPS budget is $400 million more than last year.
Currently, CPS has $190 million in its reserve fund and last year it had $311 million. In the interim the district plans to implement an unspecified line of credit, which it plans to repay within a year. State law prohibits the district from using any lines of credit to balance the budget.
However, the fund would be replenished once the state pays the district the $236 million it owes them, Huberman said.
“We would not have had to deplete our reserve fund and make painful cuts if the state would simply paid its bills on time,” Huberman told the Defender. “Given that fact, I am sure the state will get caught up in time for us to rebuild our reserve fund.”
Board policy requires maintenance of a minimum fund balance equal to 5 percent of the annual budget. However, he said CPS is allowed to deviate from the policy due to “extreme circumstances.”
Proposed cuts Huberman is recommending to the Chicago School Board in order to erase a $370 million deficit include eliminating 2,007 positions, such as teachers, academic coaches and administrative staff. About 1,200 employees will receive layoff notices this week, he said.
The next scheduled Chicago School Board meeting is Aug. 26. Public hearings on the budget are set for Aug. 17, 18 and 19.
Thanks to the Illinois Legislature passing a pension relief bill in April, CPS’ deficit was reduced by $400 million, which the district projected as high as $1 billion back in January.
But the continued reduction in state funding and increases in operational spending has made balancing the budget difficult, according Huberman.
“State funding has decreased by $70 million while contractual increases in compensation has gone up $169 million and $133 million in operational costs,” he explained. “School-based cuts total $104 million and $266 million was cut from the central and citywide offices.”
The school-based cost savings include $30 resulting from increasing the average high school classroom size to 33 from 31 and reducing charter school funding by 6 percent for a savings of $15 million. And of the reductions 28 percent are coming from schools while the remaining reductions will come from central and citywide cuts.
Those cuts include a savings of $6 million from 21 furlough days and $2 million from supplemental security. Huberman said the security cuts do not constitute a reduction in its security budget either.
Last year CPS started a safe passage program at several schools identified as having high incidents of violence. Originally it planned to spend $60 million over two years on the program but that has been slashed by $20 million to help balance the budget. And even though the program is being funded with a federal grant Huberman said the grant does allow for the district to use the funds for operational costs as well, so no laws are being broken.
Part of the district’s operating costs is salaries and teachers are scheduled to receive a 4 percent pay raise this year. Had teachers forgo their raise Huberman said high school class sizes would not have had to increase.
Newly elected Chicago Teachers Union President Karen Lewis said teachers should not have to give up a long and overdue raise to help balance the budget.
But shared sacrifice is something Huberman said he is seeking from everyone.
“I have proposed that principals and assistant principals take six furlough days this year,” Huberman said, who added that last year they were exempt from having to take furlough days.
To avoid being in this position next year Huberman recommends that the Illinois Legislature pass a modest income tax increase to generate more revenue for public schools.
Copyright 2010 Chicago Defender
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