Chicago Schools Propose $8.4 Billion Budget for Fiscal 2021

(Bloomberg) -- Chicago Public Schools on Monday proposed an $8.4 billion budget for fiscal year 2021, a spending increase of 7% that counts on the federal government coming through with more aid.

The plan assumes the federal government will come through with an additional $343 million for the country’s third-largest school district to account for pandemic-related spending and revenue shortfalls. That’s less than what CPS would receive “in the most conservative proposal” in Congress, according to CPS. The budget also includes $128 million of federal aid from the earlier federal stimulus.

“I still remain confident Congress will come to a resolution,” Chicago Public Schools Chief Executive Officer Janice Jackson said Monday during a news conference in response to a question about additional federal funding after negotiations in Congress fell apart last week. If the federal funding doesn’t come through as the district projects, it will look at one-time options to balance the budget, she said.

The proposal includes a $6.9 billion operating budget, up from about $6.3 billion in fiscal 2020. The district plans to spend $75 million for expenses related to Covid-19 such as providing devices and Internet access to thousands of students for remote learning, and the costs of cleaning supplies and personal protective equipment to prepare for possible in-person instruction in the second quarter.

The district plans to begin the school year Sept. 8 with full remote learning and will assess the potential for in-person learning in a hybrid model starting in November.

The overall budget also includes $653 million for capital improvements at more than 250 schools, including upgrades to science labs and new preschool classrooms. The district also plans to increase the number of nurses, social workers and special education case managers to a record, staffing that the Chicago Teachers Union had fought for during the strike last year.

Chief Financial Officer Miroslava Krug said the district plans to likely go to the bond market sometime in the fall for capital investments but the size of the issuance hasn’t been determined.

The district is also proposing cuts. Funding for school resource officers is reduced to a maximum of $15 million, down more than 50% from fiscal 2020 levels, according to budget documents. Calls to remove the officers from schools have grown in the wake of the killing of George Floyd in Minneapolis in May. In June, the Chicago Board of Education narrowly voted down a proposal to remove the officers.

Chicago’s school district, which serves 355,000 students, is confronting the same financial challenges facing state, local and municipal governments across the country as the pandemic-driven recession has reduced revenue.

“While the COVID-19 pandemic has created new resource needs for our schools and students that the district is committed to meeting, it has also created unique funding challenges in the short term due largely to state funding and other economically sensitive revenues not meeting anticipated levels in FY21,” according to a statement from the district. “Schools throughout the country are managing similar challenges, and both parties in Congress have committed to supplying schools with supplemental funding to mitigate these unique challenges.”

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