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State Owes City Schools $467M In Grants, CPS Financial Crisis Widens

By Heather Cherone | May 10, 2017 2:07pm | Updated on May 12, 2017 11:44am
 Mayor Rahm Emanuel Wednesday said schools will stay open until the end of the regularly scheduled school year despite the revelation that the state of Illinois owes Chicago Public Schools approximately $467 million.
Mayor Rahm Emanuel Wednesday said schools will stay open until the end of the regularly scheduled school year despite the revelation that the state of Illinois owes Chicago Public Schools approximately $467 million.
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DNAinfo/Heather Cherone

THE LOOP — Mayor Rahm Emanuel Wednesday said schools will stay open until the end of the regularly scheduled school year despite the revelation that the state of Illinois owes Chicago Public Schools approximately $467 million.

Because of the impasse that has left Illinois without a budget for two years, school districts throughout the state have not received $1.4 billion worth of state grants through March 20 that officials count on to fund a variety of state-mandated programs, including bilingual education and school security.

Emanuel said city officials had been forced to "look at everything" to ensure that the district can keep classroom lights on — and pay its employees' pension fund $721 million by June 30.

In addition, the district faces budget deficit of $129 million, created after Gov. Bruce Rauner vetoed a bill in November that would have given Chicago's schools $215 million.

A group of aldermen proposed on Tuesday proposed dipping into city redevelopment funds and taxing big firms for each employee

Emanuel declined Wednesday to rule out either option, after months of saying city taxpayers had paid enough and that it was up to the state to fund Chicago schools equitably.

The mayor said he was proud of eliminating of the $4-per-employee monthly tax in 2011, an effort he frequently touts as a key reform that helped spur millions of dollars of economic activity in the city and prompted dozens of companies to relocate to Chicago.

"But I am also proud of the rising graduation rate," Emanuel said.

Eleni Demertzis, a spokeswoman for the Republican governor, blamed Comptroller Susana Mendoza, a Democrat, for not authorizing the payment of the grants due to Chicago schools.

"CPS’ crisis is not due to the budget impasse. It’s due to decades of fiscal mismanagement," Demertzis said.

It has been more than two years since Illinois has had a budget, leaving the state with $12.8 billion worth of unpaid bills, including the grants to schools, according to Mendoza's office.

Abdon Pallasch, the director of communications for the comptroller's office, said it was not a matter of Mendoza — who has been at odds with Rauner since her election in November — choosing not to pay the bills, but that the state simply does not have the funds because it does not have a budget.

Pallasch likened Rauner to "the check bouncer who yells at his bank for bouncing a check from an account he himself emptied."

"The governor disingenuously blames the comptroller for not writing checks from state coffers that Governor Rauner emptied by failing his constitutional duty to propose a balanced budget," Pallasch said in a statement. "Governor Rauner's fixation on holding the budget hostage to his non-budgetary pet projects has left the state's coffers empty and all school children left behind."

Mendoza has prioritized payments ordered by the courts — like lawmakers salaries — or required by law, including an $800 million payment to Medicare, Pallasch said.

Emanuel said he was tired of Rauner blaming Mendoza for the crisis.

"When are the governor and the state going to do their job?" Emanuel asked Wednesday. "We are all paying the price."