Chicago Public Schools Fiscal Year 2015 Budget

How to use this site

Users will be able to find documents and use interactive tools to help them better understand the proposed CPS budget for fiscal year 2015. The interactive features allow users to easily click through the budget, drilling into specific budget line details or staying at a high level overview of the District.

Users can view a number of areas of the budget including revenue and debt while also looking at every CPS school and department. Each interactive report generates graphs and charts which will make budget comparisons visual and easier to understand.

Check out our Reader's Guide for more information.

Download your own copy of the FY15 Budget Book Summary.

CPS received the GFOA Distinguished Budget Presentation Award for our FY2014 online budget site.

Revenue

 

REVENUE OVERVIEW

CPS receives revenue from local, state, and federal sources as outlined in the table below. Each of the different sources is described in the sections that follow, along with the assumptions used in our budget projections and a justification for our estimates.

 

Table 1: All Funds by Revenue Source (in Millions)

 

 

FY14 Budget

FY14 End Of Year

FY15 Budget

FY15  vs. FY14
Budget

Local Revenues

 

 

 

 

 

Property Tax

2,193.4

2,197.0

2,233.7

40.3

 

Replacement Tax

162.5

182.0

188.9

26.4

 

Other Local

449.6

304.0

417.0

(32.6)

 

Total Local

2,805.5

2,683.0

2,839.6

34.1

 

 

 

 

 

 

State Revenues

 

 

 

 

 

GSA

1,085.6

1,075.0

1,022.6

(63.0)

 

Capital

101.7

92.0

135.5

33.8

 

Other State

655.9

653.0

676.4

20.5

 

Total State

1,843.2

1,820.0

1,834.5

(8.7)

 

 

 

 

 

 

Federal

932.9

894.1

897.2

(35.7)

 

 

 

 

 

 

Investment Income

3.1

2.4

0.1

(3.0)

 

 

 

 

 

 

Total Revenue

5,584.7

5,399.5

5,571.4

(13.3)

Bonds & Other

 300.0

300.0

 340.0

 

 

Some of the revenues CPS receives are dedicated to debt service and others for capital. What remains is available for the day-to-day operations of CPS. While FY15 total revenues are approximately $5.6 billion, only $4.9 billion is available for operations.

 

Table 2: FY15 Revenue Sources Allocated for Debt, Capital and Operating Funds

 

 $ in millions

Total

Amount for Debt Service

Amount for Capital

Balance for Operating Budget

Local Revenues

 

 

 

 

 

Property Tax

2,233.7

55.2

 

2,178.5

 

Replacement Tax

188.9

56.2

 

132.7

 

Other Local

417.0

97.0

108.8

211.2

 

Total Local

2,839.6

208.4

108.8

2,522.4

 

 

 

 

 

 

State Revenues

 

 

 

 

 

GSA

1,022.6

191.3

 

831.3

 

Capital

135.5

63.1

72.4

0.0

 

Other State

676.4

 

 

676.4

 

Total State

1,834.5

254.4

72.4

1,507.7

 

 

 

 

 

 

Federal

897.2

24.7

               8.9

863.6

 

 

 

 

 

 

Investment Income

0.1

 

 

0.1

 

 

 

 

 

 

Total Revenue

5,571.4

487.5

190.1

4,893.9

 

Minimal Growth in Operating Revenues

The revenue picture for CPS continues to be challenging.  We have little control over the amount of revenue we receive, with most federal and state money determined by formulas which are driven by factors mainly out of our control.   The only local revenue we do control is property taxes and the amount of property taxes each year is governed by a statutory cap. 

 

Table 3: FY15 Operating Revenues Nearly Flat Compared to FY14


$ in millions

FY 14
Budget

FY 14 Estimated
End of Year

FY 14
Change

FY 15 Budget

FY 15 Change

  Property Tax

  2, 141.4

2,145.0

3.6

            2,178.5

33.5

  Replacement Tax

     105.5

125 .0

           19.5

               132.7

7.7

  All Other Local

    169.6

137.0

(32.7)

            211.2

74.2

Total Local

  2,416.5

2, 407.0

          (9.6)

            2,522.4

115.4

State

       1,621.5

     1,6 08.2

        (13.3)

            1,507.7

( 100.5)

Federal

          908.4

         865.1

        (43.3)

               863.6

(1.5)

Investment Income

               3.1

              2.4

(0.7)

                   .1

( 2. 3)

Total Revenue

       4,949.5

    4,882.7

(66.9)  

            4,893.9

11.1

 

FY15 operating revenues are budgeted at $4.9 billion, a decrease of $55.6 million from our FY14 budget and $11.1 million more than our estimated end of year FY14 revenues. Declines in both state and federal revenue nearly offset the increase in local funds in FY15.

 

State Revenues.  The main source of state operating revenue, General State Aid (GSA), is down $50 million for FY15 compared to last year.  This is due to the state’s continuing failure to fully-fund the state aid formula and changes in Chicago property values, which decrease the state’s contribution.  This decrease also includes a required payment of $7.6 million to two state approved charter schools.  Charter schools that are approved by the State Charter Commission receive funding directly from the state which is deducted from what CPS would otherwise receive for state aid1.  The pressure on the operating budget is even greater, as a larger portion of GSA must go to debt service in FY15 compared to FY14. 

 

Federal Revenues.  Looking at the aggregate federal revenue picture, revenues are projected to decrease from FY14 to FY15. This is the result of a decrease in Title I Funds, Title II Funds, and School Improvement Grants for FY15. CPS’ allocation of Title I, its major federal revenue source, is declining.  The federal award in FY13 was $287 million and decreased to $269 million in FY14.  The FY15 Award is expected to be $260.6 million.

 

However, in the case of Title I, most of this money is allocated to schools as discretionary funding, and often schools do not spend the full amount allocated to them.  Therefore, CPS has historically carried over federal funding from one year to the next. In FY15, $35 million of these carryover funds will be used, making the Title I revenue estimate $295.6 million. Thus, the use of carryover funds masks an actual decline in the amount of federal revenue CPS is receiving. These carryover amounts are detailed in the specific revenue discussions below.    

 

REVENUE PROJECTIONS
This section summarizes the major revenue sources and our estimates for FY 15.  The estimate for each revenue sources is provided in the Interactive Budget on the CPS budget website: www.cps.edu/budget

 

Local Revenues

 

Property Taxes

The FY15 budget projects $2,234 million from property taxes, of which $55.2 million is dedicated for debt service.  The operating budget includes $2,179 million from property taxes.

 

In the past, CPS operated under the 30 day revenue recognition policy under which property tax revenues were recognized as current revenues as long as they are available within 30 days after a fiscal year ends, or through July 30.  That makes the period right around the end of the revenue recognition period particularly volatile because it coincides with the property tax due date.  Budgeting revenues in the fiscal year becomes extremely difficult because of this volatility.   In an effort to address this volatility, CPS has changed for the FY15 budget the revenue recognition period to 60 days, through August 29.   This is discussed more fully in Appendix D, Financial Policies and in the Fund Balance Statement chapter.

 

Personal Property Replacement Taxes (PPRT)

PPRT is expected to increase from $162.5 million in FY14 to $188.9 million in FY15, based on a State- projected 3.4% net growth rate. This includes $56.2 million set aside for debt service and leaves $132.7 million for the operating budget.

 

PPRT includes an additional state income tax on corporations and partnerships, a tax on businesses that sell gas or water, a 0.5 percent fee on all gross charges for telecommunications services excluding wireless services, and a per-kilowatt tax on electricity distributors. The primary driver of PPRT is corporate income-tax receipts, which are closely tied to corporate profits. 

 

The state collects and distributes PPRT to local taxing districts. Taxing districts in Cook County receive 51.7 percent of collections, which is divided among the County’s taxing bodies based on each district’s share of personal property collections in 1976. CPS receives 27.1 percent of the total Cook County share, which is equivalent to 14 percent of the statewide total. 

 

Other Local Revenues

Other local revenues are $211.2 million for FY15 in the operating budget, an increase of $41.5 million from the FY14 budget.  The increase is mostly attributable to an $18 million increase in charter school fees for facilities, security, IT costs from charter schools at CPS-owned buildings and administrative fees.  This is the result of a new methodology for collecting fees rather than netting them out of expenses and is discussed fully in Appendix B: School Funding Formulas.

 

“Other local revenues” also includes the pension payment made by the City of Chicago on behalf of CPS employees in the Municipal Employees pension fund (discussed in the Pension chapter) and is estimated at $55. 9 million. It is recorded as revenue as required by the Governmental Accounting Standards Board (GASB).   

 

In addition, this category includes $25.0 million for TIF surplus dedicated to funding new Arts and PE teachers, $10.5 million for funds generated and used by schools, and $5.1 million for rental income.

 

When considering all funds, an additional $108.0 million supports the capital budget, and another $97 million supports the debt budget.  This is made up primarily of various intergovernmental agreements with the City.

 

State Revenues

 

General State Aid (GSA)

 

GSA represents the major state support that all public school districts receive. GSA consists of regular GSA and a poverty grant. Regular GSA utilizes many factors in its allocation formula, such as average daily attendance, a specified annual foundation level, available local resources, and tax rates.  The poverty grant is allocated based on the concentration of low-income students that utilize Medicaid, food stamps and Temporary Assistance for Needy Families (TANF). 

 

Although the per pupil “foundation level” is set at $6,119 for FY15, the same as in the past three years, the statewide appropriation is insufficient to pay for the foundation level. Therefore, all school districts will receive 90 percent of their GSA.  As discussed above, CPS is expecting a decrease in GSA from $1,075 million to $1,023 million.

 

In addition, CPS requests adjustments on prior-year GSA allocations based on property values that were subsequently reduced after the taxpayer filed a successful property tax appeal. CPS expects to receive $16.3 million for FY15.   

 

The allocation to schools of Supplemental General State Aid (poverty grant) will stay at $261 million, consistent with statute. Debt service requires $191. 2 million and the balance of $570.4 million will go to the General Fund.   

 

General Education and Educational Services Block Grants

CPS receives two block grants: General Education Block Grant and Educational Services Block Grant (ESBG). The grant amounts are computed by multiplying the State appropriation for the programs included in the grant by the Board’s percentage share of those programs in FY1995.

 

For FY15, CPS anticipates new state funding to remain level at $111.1 million; however, the budget also includes $8.3 million in funds unspent in FY14 that will carryover to FY15.  

 

Under the Educational Services Block Grant, CPS is projected to receive $476.4 million in FY15, slightly above the $472.5 million projected for FY14.

 

Because of fiscal constraints, the State has delayed payment of two block grants and other miscellaneous grants since FY09.  However, in Fiscal Year 2014, the state is current on its payments, the FY15 budget assumes that the state will remain current throughout FY15.

 

Other State Revenues

Other state funding includes capital funds and small categorical state grants that are not accounted for anywhere else.    It includes vocational education, bilingual education, driver’s education, and other state grants.  Details of each are available on the budget website.

 

State Contribution for Capital

 

  • School Construction Program: In FY10 the state adopted The Jobs Now! Capital program, including funding for P-12 capital programs.  CPS receives 20 percent of the statewide $1.5 billion total ($300 million) over several years. The Capital Development Board (CDB) administers capital improvement programs for local school districts. CPS received $60 million in FY13 and   $54.1 million is anticipated in FY 2014 which will be used to offset debt service costs.  CPS expects to receive $59.2 million in FY15 which will also go toward debt service.
  • Additional School Construction Funding: The State General Assembly recently passed a bill that appropriates $35 million for state school construction.  CPS has included this amount in the FY15 budget, although at the time of this writing, the Governor has not acted on the appropriation bill.
  • DCEO Energy Grants.  CPS expects to receive $7.0 million from the state Department of Commerce and Economic Opportunity for capital grants to improve energy efficiency.
  • Capital Grants for Specific CPS Schools:  The state’s FY15 capital plan includes an additional $17 million in grants for capital projects at specific CPS schools. $16 million will be used for overcrowding relief and  $1,000,000 will be used for school security equipment grant funded through the Illinois Emergency Management Agency. The CPS FY15 budget anticipates receiving these funds.
  • Gaming Revenue for School Construction.  New legislation was passed in 20132 that transfers funds from the State Gaming Fund to support school construction.  CPS receives annual payments of $13.3 million to support construction of new schools. 

 

FEDERAL REVENUES

Most federal grants require the Board to provide supplemental educational services for children from low-income or non-English speaking families or for neglected and delinquent children from preschool through 12th grade. These grants are dedicated to specific purposes and cannot supplant local programs. Medicaid reimbursement and Impact Aid are the only federal funding that is without any restriction. 

 

Elementary and Secondary Education Act (ESEA) (also referred to as No Child Left Behind)

 

  • Title I-A: Low Income: Allocated based on a district’s poverty count, this is the largest grant received under the No Child Left Behind Act. The grant allows the district to provide supplemental programs to improve the academic achievement of low-performing students. CPS anticipates a reduction in the formula-based Title I amount to $260.6 million for FY15 . The total grant available for FY15 is $ 295.6 million, which includes carryover of $35 million from prior years.

 

  •  Title I-A: School Improvement Grant 1003(a): This grant provides services for underperforming Title I schools to improve the overall academic achievement of their students. The State utilizes Title I funds to carry out its system of technical assistance and support for local educational agencies. Because of program changes by the state, the current award will decrease to $3.2 million for FY15.
  • Title I-A: School Improvement Grants 1003(g): School Improvement Grants help ensure that all students have reading and math skills at grade level by 2015. Seven high schools will receive new awards in FY15. The total amount available for FY15 is $29.6 million under these grants when including rollover amounts. 
  •  Title I-D: Neglected/Delinquent: This grant targets the improvement of educational services for neglected or delinquent children and youth in local and state institutions to assist them in attaining State academic achievement standards. Programs include academic tutoring, counseling and other curricular activities. The allocation for FY15 will be $1.77 million.
  •  Title II-A: Improving Teacher Quality: Class size reduction, recruitment and training, mentoring and other support services to improve teacher quality are funded through this grant. The current year award is estimated to drop to $36.1 million in FY15. Including the estimated carryover of $6.4 million, the total award available for FY15 is $42.5 million.
  • Title III-A: Language Acquisition: Support is provided to students with limited English proficiency who meet eligibility requirements. The total funding available for the Language Acquisition grant is budgeted at $13.9 million for FY15, which comprises the estimated current-year allocation of $9.1 million and carryover of $4.8 million.       
  • Title IV-B: 21st Century Community Learning Centers: These grants provide opportunities for communities to establish schools as community learning centers and provide activities after-school and during evening hours.  For FY15, CPS estimates grant awards of $13 million, and rollover of $.6 million.
  • Title VII-A: Indian Education: Funds from this grant are used to meet educational and culturally-related academic needs of American Indian and Alaska Native students.  Funds for FY15 are expected to decrease to $190,000.
  • Title VIII: Impact Aid: This grant offsets lost revenue from federal acquisition of real property.  The Impact Aid is expected to stay flat at $100,000 in FY15.

 

Individuals with Disabilities Education Act (IDEA)

IDEA grants provide supplemental funds for special education and related services to all children with disabilities from ages 3-21. 

The IDEA grants include a number of programs.

  • IDEA Part B flow- Through: This is the largest IDEA grant, which is allocated based on a formula established by the State. The estimated award for the flow-through formula grant totals $100. 1 million, which consists of $90.7 million of current-year funding and $ 9.4 million of carryover funds.
  • IDEA Room & Board:  This grant provides room and board reimbursement for students attending special facilities outside of Chicago and is estimated at $ 800,000.
  • Part B Preschool: This grant offers both formula and competitive grants for special education programs for children ages 3-5 with disabilities. These preschool programs are expected to have $1.6 million from the formula grant ($1.2 million of FY14 allocation plus $330,204 of carryover/rollover) and $ 489,650 from a competitive grant for FY15.

 

Including small competitive grants and carryovers from the previous year, total IDEA funding equals $103.7 million for FY15. 

 

National School Lunch Programs & Child and Adult Care Food Program

 

CPS offers breakfast, lunch, after school supper, after school snacks, and Head Start snacks for students during the school year, and serves breakfast and lunch during summer school. The federal government provides reimbursement for free, reduced-price, paid lunches and breakfasts under the National School Lunch Program. In addition, the federal government reimburses for free after school meals and free Head Start snacks under the Child and Adult Care Food Program and provides free surplus commodities based on the number of prior year lunches served. CPS’ universal school breakfast programs provides breakfast free of charge to all students regardless of income eligibility in the classroom when school starts in the morning rather than in the cafeteria before school starts, easing participation for students. 

 

Federal reimbursements are projected to increase from $201.1 million in FY14 to $207.9 million in FY15 with an increased reimbursement rate, higher contribution of donated food, and increased participation rate in the snacks and after-school program. These revenues include:

 

  • $135.4 million from school lunches
  • $52.1 million from breakfast programs
  • $12.3 million of donated food from the U.S. Department of Agriculture 
  • $8.1 million from after school supper and Head Start snack programs

 

Medicaid Reimbursement

CPS provides a variety of services to students with disabilities such as speech therapy, physical therapy, occupational therapy, mental health service and special transportation. CPS qualifies for Medicaid reimbursement for these covered services and the costs of administrative outreach activities provided to eligible students. 

 

Medicaid revenues are expected to decline to $47.6 million in FY15 from $52.3 million in FY14 due to a decrease in fee for service revenue.       

 

Other Federal Grants

Other Federal Grants include competitive grants for other specific purposes. Below is a brief description of major grants under this category:

 

  • Head Start: The United States Department of Health and Human Services provides funds for the Head Start program, which focuses on educating children from birth to five years old who are in low-income families. The program provides comprehensive education, health, nutrition and parent involvement services to these children. CPS Head Start programs are funded through the City of Chicago. The FY15 award for Head Start is expected to increase to $ 43.0 million from $39.9 million in FY14.  
  • Carl D. Perkins: This grant was established to develop academic and technical skills for career opportunities, specific job training and occupational retraining.  This grant targets students in secondary and post-secondary education.  The Perkins formula grant is anticipated to decline to $6 million as a result of decreased poverty rates. With the estimated $ 600,000 rollover, the total grant will provide $6.6 million for the program.
  • Race-to-the Top:  The FY15 allocation of $7.9 million will allow CPS to integrate and analyze data collection; create science, technology, engineering and math programs; and train teachers on the CPS framework for teaching.  This amount includes the FY15 allocation of $1.9 million and carryover in the amount of $6 million.
  • Smaller Learning Community Grants: The grants are used to implement smaller high schools to improve academic achievement, graduation rates and the learning climate and culture.  Congress eliminated this grant; the total award remaining for the last year of the grant is $2.6 million.  Estimated carryover for FY15 is $1 million.
  • E-Rate Subsidy.  CPS expects to receive an E-Rate subsidy of $13.8 million in FY15.

 

Federal Interest Subsidy under Qualified School Construction Bonds (QSCBs) and Build America Bonds (BABs)

In FY15 CPS will receive a direct federal subsidy payment of $24. 7 million for these two types of federally-subsidized bonds.  This is $0.2 million higher than FY14 due to changes in federal sequestration assumptions.

 


1 The charter average daily attendance is added to CPS attendance and included in the GSA formula.

2 PA 98-0018

Page Last Modified on Thursday, August 28, 2014