Mayor Brandon Johnson’s proposed city budget includes $286 million for Chicago Public Schools — in line with what the school board budgeted in late July, but only half of what the cash-strapped district received last year.
The $286 million comes from a surplus of funds from special taxing districts, known as tax increment financing, or TIF. When officials declare a surplus, they return the money proportionally to the taxing bodies, with about half going to CPS and a quarter to the city. This year, Johnson’s budget proposal includes a total TIF surplus of $522 million, officials said.
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CPS and city officials have increasingly relied on TIF to plug perennial budget gaps. The school district initially budgeted for $200 million in TIF funds, but after pushback from board members and staff unions, CPS raised that figure to $285 million to prevent five furlough days. In July, CPS CEO Macquline King called the district’s projection “a conservative estimate.”
Still, CPS remains on shaky financial footing.
As part of CPS’ revised $10.11 billion budget, school board members aligned with the Chicago Teachers Union included an amendment for $150 million in unconfirmed state funding, reversing hundreds of layoffs and other department cuts. CTU pointed to commitments from several state lawmakers, but the district warned the move carried serious financial risk.
Three months into the school year, Springfield has yet to commit to providing that money. That may mean some cuts will be back on the table during the spring semester. A larger TIF surplus from City Hall could have helped offset the risk of those midyear cuts.
State law requires CPS to pass its budget by late August, well before it receives a finalized TIF figure from City Hall. That uncertainty has increasingly been a point of friction as CPS prepares its spending plan. Some school board members pointed to that uncertainty to justify relying on the unconfirmed state funding, arguing that the TIF money was far from guaranteed either.
A district spokesperson said CPS is “pleased” by the mayor’s proposed TIF sweep, but added “without any additional state funding being authorized … by December 2026, the district will have to revisit expenditure reduction measures.”
Some aldermen voiced skepticism, meanwhile, that even a $520 million TIF sweep is feasible. Just moments after the mayor presented his budget to the City Council Wednesday, Ald. Anthony Beale took the mic as 23 aldermen outlined their opposition to the mayor’s overall plan, noting Johnson never mentioned the TIF sweep in his 50-minute speech.
Calculations aldermen received from the city’s budget office showed only $225 million available to be swept, not the $522 million Johnson’s plan relied on, Beale said. Aldermen are often reluctant to declare larger surpluses because the money may otherwise be assigned to TIF-funded projects in their wards. “One of the things that we have to get to the bottom of is which projects are being sacrificed in order to sweep this TIF,” Beale said. The frequent Johnson critic blasted the move as “nothing but a bailout for CPS.”
“This budget strategically bails out CPS because there’s no magic money of $150 million coming from Springfield,” he said. “There was no mention of that because they don’t want you all to know that they are bailing out CPS because they passed a budget that was totally out of whack.”
Whether Beale is right that the sweep could cancel almost $300 million in TIF-funded projects could become critical to aldermen deciding whether to support the measure.
The city must pass a finalized budget by the new year with a simple majority, or 26 of the 50 aldermen. Last year, the city’s budget fight stretched into December, as a bloc of insurgent aldermen voted to reject Johnson’s budget and instead pass an alternate spending plan.
Last year, Johnson declared a record $1 billion surplus, giving CPS a $576 million cash infusion — though $175 million of those funds was returned to the city for a pension payment. District officials said they had received no indication a surplus of that size would materialize again.
There are more than 100 TIF districts across Chicago, which are intended to spur economic development in blighted areas. When the city creates a TIF district, the assessed property values in the area are frozen, and any revenue above that baseline is set aside for local construction or public works projects.
In a statement Wednesday, CTU President Stacy Davis Gates praised Johnson, a former CTU organizer, for proposing the $522 million surplus and urged state lawmakers to find the money for the district before the fall veto session ends.
“This is what it looks like when Chicago elects a mayor who believes in public education,” Davis Gates said. “Now the governor and General Assembly have to follow suit.”