Chicago schools will max out property taxes, make more cuts

To help fill a $712 million hole, Chicago Public Schools will need to
collect $150 million more in property taxes, going to the limit for the
first time in four years and using a levy that they abated for the past
three years, officials announced this afternoon. To help fill a $712 million hole, Chicago Public Schools will need to collect $150 million more in property taxes, going to the limit for the first time in four years and using a levy that they abated for the past three years, officials announced this afternoon.

For the owner of a $250,000 home, the tax increase will cost $84

Even then, the district will have to make “painful cuts” that will significantly reduce the amount of support schools get from administrators and force under-enrolled schools to lay off as many as 300 teachers a month into the school year. District officials also are asking board members to pass a budget with more than $90 million in yet-to-be identified cuts, leaving vulnerable a wide range of programs and staff.

On Friday, CPS administrators released their proposed 2011-2012 budget — just two and a half weeks before the Board of Education is set to vote on it.  Next week, CPS will hold a series of budget hearings.

Mayor Rahm Emanuel supports the district’s decision to take the tax to the cap, spokeswoman Melissa Stratton said, adding that he applauded the district’s efforts to make deep cuts and still provide key supports for students.

Raising the tax on new and existing property will bring in about $100 million. In addition, the officials propose collecting the public building commission levy to bring in another $50 million. 

The amount a school district can levy is tied to the consumer price index. CPS has levied the maximum amount in 11 of the past 16 years, but didn’t from 2008 to 2011, according to CPS. Former Mayor Richard Daley sought to keep property taxes low during the recession.

Taxes small part of solution

These taxes don’t come close to solving the district’s budget deficit, said chief administrative officer Tim Cawley, citing a shortfall of $562 million.

Some of that remaining deficit was erased when the board decided in June not to fund pay raises in the contracts of unionized staff, including teachers. The unions, which are in negotiations over those raises, will be pressing leaders to prove that it isn’t possible for them to pay for the hikes.

The CTU released a statement Friday evening criticizing the district’s budget proposal, noting that the cuts will “harm students and their community schools.” On Tuesday afternoon, the Chicago Teachers Union will conduct a budget workshop for teachers and encourage them to show up at the budget hearings.

But Cawley said he cannot see how the union can make the argument that CPS has the money. “There are not smoke and mirrors,” he said. “This is real.”

In addition to deep cuts, the district will spend $241 million from reserves, leaving $289 million in savings.

More cuts to central and network offices

The biggest place where the district will cut is in the central and network offices, previously called area offices. The district will cut $100 million out of these offices. Details of what positions will be eliminated won’t be available until the September board meeting.

But Cawley said an initial forensic audit revealed people were duplicating efforts. For example, he said several departments currently believe they hold responsibility for developing curriculum and several others think they are responsible for summer school.

“We are going to try to eliminate some of the nuttiness,” he said.

With the help of a consultant, Cawley and other district officials are trying to figure out what exactly is needed in the school network offices. The district already announced it is reducing the number of offices from 24 to 19.

Under former CEO Ron Huberman, these offices were beefed up as a way to shift resources closer to schools. The offices included teams of coaches, data analysts, curriculum developers and finance managers. Each also had $4 million to dole out to schools for things like materials and professional development.

“It is colossally inefficient,” Cawley said. However, he noted that Huberman was not necessarily wrong, as no one has discovered the precise formula for how much should be controlled centrally and how much should be left in the hands of principals and middle managers.

Current CEO Jean-Claude Brizard and his chief education officer, Noemi Donoso , believe that much of these efforts should be handled by central office and that the network offices should play more of a coordination role, Cawley said.

“[Schools] do not believe in total freedom,” he said.  For example, principals would have to choose from a limited number of curriculums.  Under former CEO Arne Duncan, Chief Education Officer Barbara Eason-Watkins devised such a system where most schools had to pick from district-approved curriculums, but much of that system fell by the wayside under Huberman.

In last year’s fiscal crisis, CPS administrators scaled back central office by about 380 people. Some observers have suggested  that  central office has been cut so many times that it should have negative employees by now.

No more cushion

CPS officials plan to save another $23.5 million by ending the practice of allowing schools to keep teachers even when 20th-day enrollment falls short of projections. This move might cause a significant amount of upheaval for students.

For a number of years, CPS has provided schools a cushion when enrollments fall short, allowing them to keep one to two teachers, even if their enrollments don’t warrant it.

Last year, the practiced allowed 300 teachers to stay put, Cawley said. He acknowledged that losing a teacher a month into school is “disruptive to students.”

Fewer CPS-based cops, others

CPS also will cut other programs around the edges, with some consequences for students. Some $30 million of $86 million in proposed programmatic cuts haven’t been determined yet, though district officials say they are looking at reducing money for test development and summer job opportunities.

One area where they have pinpointed savings is in safety and security. For at least the last two decades, each CPS high school has had two police officers assigned to it. In the past, CPS has paid the police department about $8 million for these services.

Under Emanuel, police brass discovered the department was being underpaid and is demanding back payments in the range of $46 million. Cawley said he had no choice but to pay it, and the back pay is contributing to this year’s deficit.

Now, Cawley will give principals the choice of police officers, who cost the district about $50,000 a piece, or $25,000 to use for as they see fit.  He is expecting that 70 percent will take the cash, saving the district about $11 million.

The district also plans to spend S10 million less on mentoring for students who are statistically likely to be victims of violence. The intense mentoring program was started under Huberman , who was trying to reduce the shootings of CPS students.

The organizations contracted to do the mentoring said they will serve the same number of students despite the reduced funding. And Cawley stressed that the district still will spend $30 million on violence prevention programs next year.

The other two places that will take a big hit are turnaround schools and selective enrollment high schools. Turnaround schools, the district’s lowest performers,  will lose 64 positions, and selective enrollment high school will lose 23 positions.


Principals can fill gaps

Cawley emphasized that many of the turnaround schools have hefty federal grants, providing an additional $2 million a year, and therefore can fund the additional positions they need.

He also said that principals are squirreling away chunks of their discretionary money and can use that money to pay for what’s important to them. With the approval of local school councils, principals may spend state and federal poverty money, which is based on their population of students qualifying for free or reduced-price lunches, generally as they please.

Cawley said 400 principals left a total of $60 million on the table last year. “A lot of times they come crying to central office when they are sitting on money,” he said.

Clarice Berry, president of the Chicago Principals and Administrators Association, said some principals do save money for several years but for large projects they might never be able to fund otherwise, like putting in a computer lab.

But often principals do not plan to have left over money.  For instance, fewer people might take sick days, reducing the need for substitute funding, which schools are required to budget at a certain level.

 “Nobody is hoarding on purpose,” she said.

  

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