Despite budget passage, CPS funding future remains unclear

CHICAGO — A tense silence hung over the Chicago Board of Education on Thursday night as the roll call vote began.

Just hours earlier, community members had packed the room, urging the board to pass a 2025-26 budget that spared classrooms from cuts.

At the heart of the debate was a $200 million high-interest loan and a disputed pension payment for nonteaching CPS staff members — both backed by Mayor Brandon Johnson, both left out of the district’s proposal.

As Johnson-appointed board members Ed Bannon, District 1A, Anusha Thotakura, District 6A, and Cydney Wallace, District 8B, quietly broke ranks, gasps rippled through the crowded room. The final tally — 12 in favor, seven opposed, and one abstention — drew cheers.

The vote marked a public setback for Johnson, a former Chicago Teachers Union organizer navigating the shift from movement politics to municipal governance. It also exposed the political fragility of the city’s hybrid school board — long championed by progressives as a vehicle for equity, now emerging as a challenge to Johnson’s authority.

“We have this unrealistic expectation that we’ll always agree. And that’s not how democracy works,” said Bannon in an interview with the Tribune on Friday.

Board members Thotakura and Wallace declined to comment on their votes.

With major funding decisions ahead — amid a $734 million deficit — the board’s splintering leaves open questions about how political alliances will hold, and if the district can continue to shield its classrooms from deeper cuts.

A debt-laden history, a new, elected board

The push for an elected board emerged in the wake of school closures under then-Mayor Rahm Emanuel, with the goal of giving communities more control over CPS policy and separating its finances from City Hall. Backed by CTU, state lawmakers passed a 2021 law creating a phased transition. The current board is partly elected, partly appointed. The board will become fully elected by 2027.

Two years after the law passed, the union helped elect one of their own, Mayor Johnson, into the city’s top office.

But Johnson’s yearlong struggle to secure board support for a controversial borrowing plan, aimed at avoiding classroom cuts and funding a pension payment for nonteaching CPS workers, has exposed deepening divisions between his administration, former allies and a hybrid board he largely appointed himself.

At a South Side town hall earlier this week, Johnson suggested his plan was being held to a different standard.

“Did you know that (former CPS CEO) Forrest Claypool and Rahm Emanuel borrowed … and you’re talking about a $200 million possible loan?” Johnson asked. “These individuals were reckless. Let’s call it like it is. When you put a Black man in charge of the city, all of a sudden everybody wants to be an accountant.”

But for many progressive allies, this fight comes down to balance sheets.

Between 2016 and 2018, the district undertook several rounds of “crisis borrowing” to cover current expenses and settle outstanding debts, practices that are frowned upon by financial experts. The district still owes billions, according to a CPS memo issued last summer. Debts from those two years of borrowing alone cost the district nearly $200 million that year, according to the memo, with $2.1 billion still left to pay.

Debby Pope, a veteran teacher and a board member representing District 2B, abstained from Thursday’s vote. She described CPS as operating under a “budget of scarcity,” forced into zero-sum decisions that pit basic services against one another.

Ald. Nicole Lee, 11th, defended the board’s final-hour vote against the mayor’s proposal. She said “reasonable people” had “made the right decision in passing this budget.”

The TIF equation

The views of aldermen matter because the budget heavily relies on tax increment financing, or TIF, which is tax revenue set aside for designated local projects in specially drawn districts across the city.

While aldermen don’t directly control TIF spending, they influence which projects get approved and they play a key role in determining whether unused TIF funds are declared surplus. Once surplus is declared, a portion is redistributed to taxing bodies like CPS.

CPS officials said they received assurances from the city that aldermen would declare a record surplus sufficient to give CPS a $379 million cut. CTU President Stacy Davis Gates called for an even bigger cut: $500 million. She urged aldermen to commit to it publicly ahead of the board vote.

City budget chair Ald. Jason Ervin, 28th, a Johnson ally, has floated a different pressure tactic: withholding TIF dollars from CPS if the district doesn’t agree to pay the pension payment and borrow, though that maneuver could backfire, since TIF revenue is split among city agencies.

CPS receives just over half of any declared TIF surplus — about 52%. That means the city would need to declare a total surplus of roughly $960 million to generate $500 million for CPS, a historically large amount. It remains unclear how much surplus funding the district will actually receive.

Pensions, state revenue

The mayor’s other key ask — for CPS to resume paying into the pension fund for the nonteaching staff — also failed to gain traction.

Custodians, cafeteria workers and other support staff members now make up nearly two-thirds of active participants in the city’s municipal pension fund. Johnson officials argue that CPS should contribute its fair share, estimated at over $450 million annually.

For now, though, state law leaves the city on the hook. Changing that law would require support from Springfield, which Johnson hasn’t secured.

Until 2020, the city paid those pensions. Then-Mayor Lori Lightfoot shifted that obligation to CPS, and the district used federal COVID relief dollars to make the payments, until last year, when then-CEO Pedro Martinez refused. The resulting standoff led to an ugly fight between leadership, the resignation of the entire previous board and Martinez’s ouster.

And despite pressure from City Hall, Johnson’s interim CEO pick, Macquline King, held the line. The board adopted her version of the budget: no borrowing and no pension shift, unless new revenue emerges. What this means for her relationship with the mayor, and for board dynamics moving forward, remains to be seen.

Elected board member Jessica Biggs of District 6B said King’s leadership helped change board members’ minds.

“No longer was a demonized Pedro Martinez putting this forward,” Biggs said.

Political fragility ahead

The mayor’s political tightrope extends beyond the board.

SEIU, the powerful labor union that has long marched alongside CTU during Johnson’s run for office, had also raised flags over Johnson’s proposal for borrowing.

The rift between unions comes after months of tension, after CTU attempted to absorb SEIU-represented classroom aides earlier this year. The fallout grew louder when CPS announced cuts this summer to custodians and crossing guards — two groups of employees represented by SEIU.

Facing criticism from across the political spectrum, Johnson has emphasized deep-seated inequities.

At Thursday night’s town hall, he endorsed taxing billionaires, adding with a grin: “I know one. We all know at least one. And it’s well past time they put more skin in the game.”

CTU, for its part, has ramped up pressure on Gov. JB Pritzker to step in with funding, including memes likening him to Trump for not delivering $1.6 billion in additional school funding. But few in City Hall or Springfield see a state rescue as imminent. Pritzker, who controls a supermajority in the General Assembly, has shown no interest in bailing out CPS.

Still, board members say that’s where the next fight must be waged.

“Every single group with a position on this budget must bring the same focus and persistence to Springfield as they do to this congregation,” said Thotakura, who voted for the budget. “Our kids cannot wait 10 more years.”

Control, redefined

Despite reshaping the Board of Education and ousting former CEO Martinez in December, a move Johnson later said came too late, the mayor still couldn’t secure the supermajority required to green-light his loan. Not even with his handpicked schools chief, King, or a new board appointment confirmed just hours before the vote.

Three of his own appointees — along with two CTU-endorsed elected members — sided with King and passed a version of the budget that deliberately left the mayor’s proposals on the cutting-room floor.

Ald. Nick Sposato, 38th, a frequent Johnson critic, said he was “shocked” to see Thursday’s vote but believes it reflects CTU’s waning popularity after a year of clumsy politicking around the district’s finances.

“Obviously, if they wanted to run again, I would think they’d be smart enough to think it would be the kiss of death for them,” Sposato said about the board members who flipped against Johnson. “CTU’s name means nothing anymore now.”

And so, in the shadow of an elected school board — a win years in the making — the mayor is finding out just how little control he may have left.

———

(Chicago Tribune’s A.D. Quig and Jake Sheridan contributed.)

———