A Survival Budget From CPS

"Chicago Public Schools today released a $5.8 billion “keep afloat” budget that includes an additional $98 million in expected state aid and a 3-percent raise for teachers," according to this August Catalyst story (here) and some sidebars here and here. 

Or, if you want to look at the proposed budget in its raw form, look here (Download 080607_FY08ProposedBudget.doc).

UPDATE:  CPS released a presser (see below) explaining its stance, and announced public hearings on Aug. 14 at Lane Tech High School, 2501 W. Addison St., Aug. 15 at Juarez Community Academy, 2150 S. Laflin St., and Aug. 16 at Morgan Park Academy, 1744 W. Pryor Ave. The hearings each night will run from 7 p.m. to 9 p.m. The Board of Education is expected to vote on the FY08 budget at its Aug. 22 meeting. 

From CPS:

CPS Releases 2008 Budget Despite State Delay;

Proposed Tax Increase Due to Inaction in Springfield

School System Continues to Create More Learning Opportunities for Students

 

Officials with the Chicago Public Schools today released their proposed budget for fiscal year 2008 and directly linked a local property tax increase to the fact that the state has not yet fundamentally reformed education funding in Illinois.   

 

            By state law, the Chicago Board of Education must adopt a budget by the end of August, even though the State of Illinois has not yet passed a budget.  The proposed budget assumes approximately $100 million in new state funding, $55 million in new property taxes, and $73 million from reserves.

 

Ongoing union contract negotiations are adding even more uncertainty to the budget, which assumes 3% salary increases for all unionized employees.  Every one percent of negotiated salary increase costs the district approximately $25 million.

 

Chief Executive Officer Arne Duncan lamented a lack of action by lawmakers in Springfield to pass funding reform, saying, “Year after year, we are forced to raise property taxes because Springfield has not yet fundamentally reformed the way our schools are funded so that we can keep our system moving forward and give every student in every school the education they need and deserve.”

 

“The real reason we can continue investing in proven strategies like our after school programs and improving teacher quality is because of the support of local taxpayers and our continuing commitment to cutting costs,” Duncan said.  “Still, the budget we’re announcing today does not reflect all we need to do to take our system to the next level -- it reflects what we can afford to do,” he added.

 

The overall budget of $4.9 billion is up by $262 million from last year, a 5.5% increase.  This is largely due to higher salaries, pensions and health care costs as well as debt service on a $400 million capital program primarily for new school construction.

 

Chief Education Officer Barbara Eason Watkins outlined new or expanded school-based investments for full-day kindergarten, after-school programs, high school reform, teacher and principal mentoring and induction, sports, post-secondary planning, college test prep, dropout prevention, and counseling.

 

            Board President Rufus Williams praised the team for investing more money in the classroom, saying, “Our board is determined to adopt a budget that puts the needs of our children above all else, despite the fact that we still don’t have funding reform.  Our job is to open schools on September 4^th and that’s what we’re going to do.”

 

            Budget Director Beth Swanson said that administrative costs will drop from 4.2 percent of the operating budget to 4.1 percent next year.  She also said that enrollment declines and retirements, as well as lower private school tuitions for children with disabilities, will save the district $63 million in 2008.  A host of other efficiencies beginning next year will save up to $37 million more starting in 2009.

 

“All of these efficiency measures are making it possible for us to shift more dollars into the classroom,” Swanson said.

 

The budget will be the subject of public hearings on Aug. 14 at Lane Tech High School, 2501 W.   Addison St., Aug. 15 at Juarez Community Academy, 2150 S. Laflin St., and Aug. 16 at Morgan Park Academy, 1744 W. Pryor Ave. The hearings each night will run from 7 p.m. to 9 p.m. The Board of Education is expected to vote on the FY08 budget at its Aug. 22 meeting. 

Comments

[Kat]

What is meant by "High School transformation programs"? What is "teacher induction"? Is Elementary Sports in cluded in Elementary After-school Programs, or is it considered part of sports programs in general? What is "High school credit recovery"? Can anyone answer any of this for me?

I think they mean Morgan Park HIGH SCHOOL, not it's neighbor Morgan Park ACADEMY

High school transformation is new curriculum and materials, including professional development and ongoing coaching for teachers in the core subjects (English, Matn, Science) for students in grades 9, 10 and 11. Credit recovery are classes for students to make up required courses that they have failed.

3%??? MY ASS!

Yeah, put the money into the classrooms by paying the teachers! 3% will not do it!!!

Read the article:

3% os a 'soft number' and will most likely go up with negotiations. The plus side is CPS is using conservative estimates of how much money they will have, so this amount will almost surely go up.

[George Schmidt]

At least the Catalyst story got some of the facts straight, including the important fact that the CPS budget for FY 2008 is $5.8 billion -- not the $4.9 billion that was cited in the CPS press release that was handed out yesterday at the press conference.

What's the difference?

Last year, for the first time in history, CPS broke its total budget into two separate budgets, and voted on each of them separately. Whether that was legal or not (I doubt it was) is irrelevant, since the procedures wasn't challenged, and barely questioned.

When it presented its "budget" in June 2006, CPS was actually presenting only its "Operations" budget. For the first time in history, CPS left out the "Capital" budget. Until they were asked, CPS administrators ignored the trick they had pulled, but of course they had to include the capital budget at some point, so they voted on it separately (at the July 2006 Board meeting; the operations budget had been approved at the June 2006 Board meeting).

Yesterday they were about to pull the same thing (with a few other obfuscations) until I finally broke in to the TV talking heads blather to ask Arne two questions.

The first one was how big the "reserves" were averaged over the past 12 months. Arne had stated that the administration was drawing down $73 million from reserves and said that it was "unprecedented". The "unprecedented" was simply not true, and Arne knows it. Every summer he has stood with the President of the Board of Education and announced they were drawing down reserves and how that might hurt the Board's bond rating.

The question isn't how much Arne is drawing out of the reserves, but how big the reserves is. And that may be several questions, but as of yesterday the answer was (from Pedro Martinez) "$300 million." (My question was specific about the average going back over the past 12 months because at any moment the CPS "reserves" is in fluctuation, and the only way to pin it down it to get an average over time).

My second question was why they were again separating the capital from the operations budget, and announcing the CPS "budget" is $4.9 billion when in fact it's much more.

As noted above, it's unclear whether it's legal for CPS to break the two budgets apart and discuss and vote on each separately. The one impact of doing so is that the public does not have access to the "Capital" budget at the time of the budget hearings (as noted, to be held next week). Given the capital needs of CPS (and the fact that CPS has been covertly underwriting capital projects for the charter schools while claiming there is no money for capital projects for the regular public schools), this is an important fact -- both legally and financially.

Basically, by separating the two budgets and pretending the second one (capital) is not part of the "budget" (for purposes of the pubic hearings) CPS is evading the law as it applies across the state. It also allows CPS to focus discussion on a much narrower part of the "budget" during the upcoming hearings.

In answer to my question about the separation of the capital from operational budget, Pedro stated a figure for capital and acknowledged that the two had been separated -- for the second time in history -- as they had done last year.

He then gave a number, which had to be added to the official "budget" number that was presented to the press in the press statement. When added together, the two numbers give the total "budget".

Only Catalyst (and now, District 299) have gotten that number accurately:

CPS told the press yesterday that the budget for FY 2008 is "$4.9 billion." That's the number that was reported on WBBM radio, for example. And we all know how many busy people get their small dose of "facts" every day from WBBM radio.

I haven't checked today's papers to see what the budget number will be. I suspect that Crain's will report the actual number ($5.8 billion) as opposed to the number Arne actually gave out yesterday ($4.9 billion).

One of the problems that is shown by this is how easily reporters (especially the talking heads from TV who play "he said she said" reporting from authoritative sources) can show how challenged they are when big numbers are discussed.

CPS knows this, and plays off it to the hilt, as was done yesterday.

Until the reporters assigned to cover the CPS budget know at least a little about the budgets (and the math underlying them) this kind of thing will continue.

Next up?

The Civic Federation will take the numbers Arne gives out and spin them to announce, for the 110th time in 110 years, that CPS should reduce taxes and cut staff to "balance" its budget. And all the reporters will quote that "story" as if it were news -- as opposed to a silly repeat of an interest group's party line that began before the last time the Cubs won a World Series.

[George Schmidt]

Sorry for the double click. This system is acting strangely as the rain comes down tonight.

The 3% number is not a new number; it's been bandied about since April or May. Administrations in schools already knew this was the proposed figure.

[Cut the fat at 125]

Cut the pay increases and contracts at Central Office.

There is alot of fat at 125

The way they cut the fat at 125 is to cut positions and then as soon as the new budget is in they hire their friends back under different bucket numbers. Or they use position numbers from schools and have those people work at 125 instead of the school. Also, it is not so much the fat at 125 because most departments are running a bare bones operation, it is all the new people that this administration has hired that have no experience in education but are making over 100 grand a year...rumors from our real bosses down the street say that they are none too happy that Arne has too many friends doing whatever they want and he isn't putting his stamp on anything, everyone is free to do whatever they want!

Even if they "cut the fat" at 125- do you realize how small of an impact that would make overall? The complaints should be about what the governor and the legislature are doing (and have done)- IL ranks 49th in school funding- use your energy to lobby elected officials about changing that.

[Letter from the union]

CPS Budget Update

In order to open Chicago schools in September, it is necessary for the Board to pass a budget and hold hearings in advance of the opening date. Members should be aware that this in no way reflects any CTU agreement reached with the Board. State Legislators are curently considering a budget that would give Chicago Public Schools far more than what has been put into this preliminary budget. When the state budget is finalized and a contract settlement reached, one that has been voted on and approved by a referendum of CTU members, the Board will pass an amended budget to reflect the actual agreement figures.

Click here to read more: http://www.suntimes.com/news/education/499591,CST-NWS-skul07.article

http://www.chicagotribune.com/news/local/chicago/chi-cpsbudgetaug07,0,2925312.story

It has always been my understanding that the capital budget is a separate budget mandated by law and that it can't be touched for other uses.

Anybody with one credit-hour of governmental accounting knows that operating and capital budgets are SUPPOSED to be separate. George is often full of half truths and innuendo, but here, he is just flat out wrong.

[Cut the fat at LSC Relations/Parent Centers]

I heard that their is a hiding place at the old Raymond School at 37th and Wabash.

Highly paid CPS employees work their.

How many parents know about this place?

Their are over 90,000 paid employees hiding their?

Did anyone know that?

What accountability system is in place, Carole Wood?

Why is their still contracted employees at 125, next door to Arne's office at LSC Relations?

Start auditing?

THERE, not "their" geez.
I can ignore punctuation, but please!

[George Schmidt]

Forget your "government accounting" BS, 8:13. Separating capital and operations into different sections of the annual budget is one thing, pretending that "operations" is the only budget subject to public review is quite another. And since June 2006, CPS policy has been changed from the former (one budget, including both operations and capital) to the latter (capital separated from operations and not subject to the public hearing process).

In most towns, that would be significant news. Just because you've been living under a dictatorship (whose policies you seem to favor) doesn't mean that's the way it should be. And I'm sure your professor from accounting 101 would tell you that if you phrased the question accurately and in context.

Until last year, CPS included both the operating and capital budgets in the budget documents. That was the "budget".

Both were available for public input at the annual budget hearings.

When that was changed by Arne Duncan and his budget team in June 2006, it resulted in a great deal of confusion. One of the most notable things about the process last year was that the Board actually voted on two budgets, the operating budget in June and the capital budget in July. The former was subject to the budget hearings, as was traditional, but the latter wasn't available until the day of the vote, so it was impossible for anyone to examine or comment on it during the hearings in June.

One liners from anonymous bloggers referencing government accounting credits from aonymous universities don't clarify anything, although free ignorant venting is always a blogger's prerogative.

Monday, CPS gave out a press release stating that the "$4.9 billion budget" was being discussed. After they were questioned, they noted that the actual budget (operting and capital) totalled $5.8 billion.

And that $5.8 billion is what everyone except WBBM radio eventually reported, because that's the "budget" for CPS for FY 2008.

And that's what should be available for discussion at Lane Tech, Juarez, and Morgan Park next Tuesday, Wednesday, and Thursday evenings (7:00 p.m.) when the budget "hearings" are held.

It's likely that this year the budget hearings will feature the Power Point from Beth Swanson (now budget chief) wiith Pedro Martinez backing up. By today, all of the budget materials are supposed to be available at all public libraries, and at other public places (like your alderman's office and all schools).

Try to read them if your training has gotten you there. And see what questions you have, and how to get them answered, either at the budget hearings or at the August 22 Board meeting. CPS is going to spend around $5.8 billion between July 1, 2007 and June 30, 2008 (that's FY 08).

Trouble is, most of the budget you will find is on a CD, and unless the library lets you print out the whole content of the CD you'll be stuck.

Which is, I supposed, not something "8:13" ever encountered in Gov ACC 101 at the University of Phoenix or Nova. But let's not let reality step into a nifty cool blog.

The hearings are next week, north side to south side.

See you there, 8:13. Be sure to intruduce yourself. I look forward to hearing your analysis of the combined CPS budgets, as well as your other contributions to Chicago civic discourse.

"although free ignorant venting is always a blogger's prerogative"

I imagine George looking in the mirror as he wrote that line.