April 9, 2014
CHICAGO – Chicago Public Schools (CPS) today initiated the first step in its budget process for School Year 2014-15 (SY14-15), distributing school budgets to principals that anticipates an increase base per pupil funding by $250. CPS CEO Barbara Byrd-Bennett will be announcing the District's entire budget later this year that will continue to prioritize streamlining Central Office and directing as many resources as possible to the classroom.
"I am confident that this increase in per pupil funding will help sustain and accelerate the academic gains CPS students have made in recent years," said CEO Byrd-Bennett. "While we work with partners in Springfield to address our systemic financial challenges, which are driven by our need for pension reform, we will continue to invest in the success of Chicago's next generation because nothing is more important than providing every child and family with equitable access to a high quality education."
In its effort to invest in our students and keep cuts away from the classroom, CPS continues to streamline Central Office and administrative spending. Since 2011, the district has reduced Central Office, administrative and operations spending by nearly $700 million and this amount is expected to grow over this next school year.
By extending CPS' revenue recognition period to August 29 (60 days after end of the fiscal year), CPS expects to account for several hundred million dollars of additional, one-time revenue in FY15 that they otherwise would have received in FY16. The City of Chicago already uses this timeline, and the majority of schools districts in Cook County and large cities around the country such as New York, Los Angeles, Philadelphia and Miami have up to 60-day recognition periods. This anticipated revenue gives CPS enough of a foundation to release these school budgets, while they continue to work through other components of the budget between now and the end of the fiscal year.
This accounting change will be made in an effort to prevent draconian budget cuts in FY15, but it does not address the significant structural deficit CPS faces. Without meaningful pension reform, CPS has no other viable options to close the projected $1 billion budget deficit for FY 16. CPS' pension obligation will increase by an additional $83 million in FY15, totaling $697 million, which amounts to $1,700 per pupil. Pension reform in Springfield remains critical to the long-term financial stability of CPS, and the District's best option to protect investments that directly support student learning, such as full-day kindergarten, the full school day and year, and STEM and IB programs.
This year's budget reaffirms CPS' commitment to empowering principals as the instructional leaders of their school by continuing the Student Based Budgeting Model. Principals must not only be held accountable for the academic achievement of their students, but must also have the ability to make decisions that drive learning in their schools—that includes how resources are allocated.
Student-Based Budgeting (SBB) gives principals the flexibility to allocate core instructional dollars while also creating a fair and equitable funding process where funds directly follow the students. In previous years, principals received per-position, not per-pupil, allocations from the Central Office based on an outdated formula that dictated specific numbers and types of positions to fill within their schools. Student-based budgeting actually also gives principals more flexibility to ensure that they have the right number of teachers for their students, ensuring a small class sizes and teacher to student ratios. CPS refined its approach for FY15, looking at a school's past and future enrollment projections, as well as gathering input from the network chief and principal to determine its funding allocation.
Last school year, CPS allocated about $65 million to ease the transition to a new budget model for schools that saw a drop in funding because enrollment was lower than projected or because they experienced reductions in various programs.
In FY15, CPS is reinvesting those dollars to help increase the base per pupil funding and will be working with schools where enrollment declines have led to the sharpest drops in funding and put pressure on core academic programs. CPS will be working directly with those schools to identify areas of need and provide the appropriate resources necessary to sustain academic gains.
Per-pupil funding provided to schools is expected to be sufficient to support core instruction, and schools receive supplemental funds to cover other programming in addition to core instruction. It is also expected that schools will be able to support the PE & Arts initiatives with the funding provided. As previously announced, TIF funds will be available for schools to hire PE and Arts teachers for every student to have access to consistent exercise and a robust arts education, as outlined in the District's PE policy and Arts Education plan.
While CPS is increasing the amount that it can provide per pupil, the remaining funding in a school's budget is made up of various resources provided by and subject to the state and federal governments for educational supports outside of core instruction funding. Examples include supplemental general state aid and money for special education, magnet, International Baccalaureate, bilingual, STEM, English language learner and Title I programs, as well as operations funding, including security and nutrition services.
CPS also is investing in additional training for principals and Local School Councils on budgeting, scheduling and staffing, since they are responsible for budget decisions at the school level and are given unprecedented autonomy under SBB to meet the unique needs of their students.
Over the next few weeks, principals will build out their own school budgets and staffing plans and then submit those proposed budgets to the Central Office budget team. Once finalized, those budgets will be incorporated into CPS' District-wide budget, which is scheduled for release later this year.
Chicago Public Schools serves 400,000 students in 658 schools. It is the nation's third-largest school district.