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Interim CPS Chief Rejects Pension Payment and Borrowing in $10.2B Budget Plan

Relying on extra TIF transfers plus one-time savings, the budget seeks to protect classrooms.

Overview

  • Interim CEO Macquline King will present a $10.2 billion proposal that omits the $175 million MEABF pension reimbursement and avoids short-term, high-interest borrowing.
  • The plan counts on increased Tax Increment Financing transfers, one-time savings and central office cuts to close a projected $734 million gap without midyear school reductions.
  • Mayor Brandon Johnson and his appointed board majority had urged a roughly $200 million loan and the pension payment to shore up schools, but King’s stance intensifies the political dispute.
  • Under state law, the Chicago Board of Education must approve a balanced budget by late August, with a preliminary vote scheduled Wednesday and final passage required before classes start.
  • Analysts warn that declining the pension payment could prompt TIF funding retaliation from aldermen, while taking on new debt risks credit downgrades and higher long-term interest costs.