Quick Hit Matthew Blake Thursday July 12th, 2012, 4:53pm

Maligned CPS Budget Proposal Might Not Be Final Version

What do the Chicago Teachers Union, Occupy Chicago, the Chicago Tribune editorial page, the Chicago Civic Federation, and Moody’s credit rating agency all have in common? They have each slammed the Chicago Public Schools for proposing a budget that drains the system’s entire $349 million rainy day fund.

The widespread disapproval raises the question of whether the Board of Education, which is appointed by Mayor Rahm Emanuel and typically rubber stamps any CPS proposal, might suggest changes to the new budget at its July 26 meeting.

“There is no support for this,” says Rod Estevan of Access Living, who specializes in CPS budget issues. “I would not be surprised if they came forward with another budget.”

Complicating any budget is that CPS is negotiating a new collective bargaining deal with CTU. A fact finder is supposed to present his recommendations Monday to both sides on central bargaining issues including raises, health benefits and performance evaluation procedures.

The $5.16 billion budget CPS proposed for the 2012-13 school year includes a two percent teacher raise, as well as two percent pay hikes for administration positions. However, CTU wants a 29 percent raise over the next two years, partly as compensation for a seven-hour school day CPS plans to implement next year.

“The budget could change enormously,” Estevan says. “An arbitrator could easily say, ‘fair is fair boys’ if you are changing work rules, you need a bigger raise.”

CPS spokeswoman Robyn Ziegler says that such budget changes are “not known at this time as we are still negotiating with CTU.”

Following a fiscal crisis before the 1979-80 school year, the state government created the Illinois School Finance Authority that set up a reserve fund for CPS. If the budget stays as is, it would mark the first time in the ensuing three decades that CPS enters a school year with no reserve funds.

“CPS has proposed to draw down its reserves in the past, but last minute, one-time federal and state revenues prevented it from having to do so,” Ziegler says.

Any help from the cash-strapped federal or state governments this time appears unlikely.

Meanwhile, Moody’s Investor Services downgraded CPS’s bond rating following the budget proposal – so it will cost more for the district to borrow money.

Fiscal moderates and conservatives like the Chicago Civic Federation and Tribune editorial page note the CPS budget does not take into account future pension payments for teachers. These payments are scheduled to increase in the 2013-14 school year.

Those sympathetic with CTU view the budget as a cynical attempt for CPS to cry poverty. "A lot of people are very skeptical as to the legitimacy of ending the reserve fund,” says Matthew McLoughlin of Occupy Chicago, who is part of the newly-formed Chicago Teacher Solidarity Campaign. “It just seems like they are setting the schools up for disaster.”


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Many people have responded to articles from the Tribune lately talking about the teachers pension payments. I wish the public reading these responses would understand that the pension payments are apart of their salary. When you see what they earn on public sites, this includes the pension. The Board, years ago, offered to put more money into the pension instead of giving the teachers a raise. During hard economic times people seem to forget the past. For years before this last teachers contract city workers ( police, firefighters, garbage men, and their administrations) were getting 6-8 percent raises yearly in their contracts. Teachers were getting 2-3 percent. The Board offered to put more money into the pension fund. The teachers contract states clearly that the pension the Board pays is considered a part of our salaries. When I hear about the one billion dollars the Board will owe the pension fund in fiscal year 2014 I have no sympathy! Cps has asked the state for a pension holiday over and over and now they have to pay the piper. Teachers do not get social security this pension is their retirement! The policemen and firefighters can retire at 20 years while a teacher has to put in 34 years or be 67 years old! This seems incredible to me. When people talk about pension reform why not look at this issue. Let the teachers retire earlier. Why force teachers to stay in the system that long, let them retire in some of their best years . The FBI even forces retirement at 27 years. They are public servants as well. Everyone is asking for pension reform these days it seems, but has anyone considered that the teachers would then be entitled to ask for the pension contribution the Board promised them instead of raises to be put back into their salaries?

On a final note everyone is saying the obvious that Rahm's budget is setting cps to fail. Good news, all of you are correct! Some Articles have eluded to it but no one has said it. I think they wish to bankrupt cps in order to get out of their contracts with the unions as well as slip out of their pension debt that they brought on themselves. If this happens in 2013 current working teachers would lose their jobs and the system has some fantastic teachers. Teachers who have already retired after working over 30 years would be in danger of no longer receiving their pensions that they do deserve. By the way, has anyone looked at a congressmans pension lately? It seems the entire financial problems that our state is having is all about the teachers pension!

No one likes a teachers strike, but I do like the fact that parents are starting to slowly see the teachers side and how the Board is treating its teachers. When the fact finding report comes out I hope it let's the public know how much money cps wastes on underperforming charter schools, administration salaries, and testing. Every two or three years they throw money at something new. Suburban school districts for the most part do not go through this constant cyclical metamorphosis!

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