Budget Overview

Introduction

Like school districts throughout the country, Chicago Public Schools (CPS) continues to manage the impact COVID-19 has had on our school communities. Our FY2022 budget provides the near-term resources needed to help students heal from the pandemic while investing in the long-term interests of our schools and promoting responsible investment and financial stability. This budget builds on the commitments of academic progress, financial stability, and integrity established by the district’s Five-Year Vision, which was released in the spring of 2019.

Our FY2022 operating budget totals $7.8 billion and invests $4.4 billion in school-level funding (an increase of more than $266 million from last year). Our capital budget invests $706.6 million in projects that will help ensure students across the city have access to modern, safe school buildings for years to come. School budgets for FY2022 will provide CPS schools with a comprehensive set of supports to advance equity; expand access to free pre-k; meet the needs of diverse learners; increase nurse, social worker, and case manager staffing to record-high levels; and address unique student needs arising from the pandemic.

Stronger School Budgets Through Impactful Community Engagement

Our FY2022 operating budget reflects feedback provided through an extensive community engagement process undertaken by the district. In alignment with recommendations made last year by the CPS School Funding Working Group, the district held four public forums this winter to gather input on school funding and other priority areas in the year ahead. School budgets were informed by the feedback that CPS received, which focused on the need to address enrollment loss during this past year, academic and social and emotional needs as a result of the pandemic, and resource equity.

Healing from the Pandemic

The proposed FY2022 budget balances the unique needs of today’s learners with the future we see for our students after the era of COVID-19. The district has created Moving Forward Together, a new multi-year initiative that will invest more than $525 million in the resources and supports our students and school communities need as they emerge from the pandemic, such as mental health supports, access to tutors and mentors, new technology, expanded summer learning, and job opportunities. Moving Forward Together is designed to be an iterative plan that includes feedback from school leaders, teachers, students, parents, and community partners.

Schools will receive $85 million in new, supplemental funding next year to use as they see fit to address needs created by COVID-19: $47 million of those funds can be used at the school’s discretion to provide targeted student support and $23 million will be used to expand Out-of-School Time enrichment programming at all schools. The remaining $15 million will be allocated to charter schools to represent their proportionate share of the funding. Moving Forward Together funds will be distributed using a holistic School Investment Index to ensure that our hardest hit communities are prioritized.

Additionally, because schools in Chicago have seen a significant decline in enrollment due to the pandemic, the district has revised its funding methodology and invested an additional $32 million to ensure that schools are not harmed as a result of enrollment declines that were associated with the pandemic. By calculating what enrollment decline levels are likely pandemic-related based on prior years’ trends, 262 schools received additional funding to offset the impact. A detailed breakdown of the methodology can be found here.

Narrowing the Opportunity Gap for Students Most in Need

CPS remains focused on improving equity in our schools and is committed to ensuring all students receive the same opportunities for a high-quality education, regardless of their race, zip code, country of origin, or diverse learning needs.

The FY2022 budget allocates millions of dollars to ensure that students who most need support will receive the necessary resources to help them reach their full potential. Also, in order to target resources for the schools in greatest need, the CPS Equity Office developed a new Opportunity Index, which identifies high-needs schools based on a variety of factors, including income, diverse learner populations, community life expectancy, teacher retention, and SQRP rating. For example, CPS has increased funding for our Equity Grant program from $44 million last year to $66 million in FY2022 to help ensure that the more than 400 schools experiencing low or declining enrollment or community hardship can continue offering high-quality academic programs this school year.

Increasing Funding and Opportunity for Diverse Learners

The FY2022 budget also includes an additional $30 million to support special education needs and expand opportunities for diverse learners at selective enrollment high schools. Last year, CPS instituted a new special education funding process to ensure consistent methodology equitably allocates resources throughout the district. This year, we are maintaining that methodology and increasing our investments to reflect changing student needs, expand access to blended early childhood programs, and provide diverse learners greater access to selective enrollment high schools.

Earlier this school year, CPS committed to more than doubling the number of diverse learners who are offered spots at selective enrollment high schools. All selective enrollment high schools are receiving at least one additional special education teaching position and one additional case manager position to ensure adequate support for these students.

Moving Closer to Universal Pre-K

CPS is investing an additional $16 million to add free full-day pre-k classrooms and serve more than 1,200 additional students in 17 communities—bringing the total of full-day seats to 16,020. As a result of this continued investment, CPS has made age four the point of entry to free, full-day instruction for the vast majority of Chicago families, including all families in our highest-need communities. Access to high-quality pre-k is one of the strongest predictors of a student’s long-term achievement, and our continued expansion of free, full-day pre-k will positively impact Chicago’s students for generations.

As part of this expansion, CPS is continuing to prioritize students with special needs, increasing full-day access for four-year-old diverse learners by adding blended classrooms.

More CPS Nurses, Social Workers, and Case Managers than Ever Before

As part of the district’s multi-year commitment to dramatically increase staffing levels in critical support roles, such as full-time nurses, social workers, and case managers, staffing levels are currently at an all-time high. The district continues to work toward providing a nurse and social worker in every school by the 2023-24 school year.

For FY2022, the district is budgeting $17 million in additional funds for 78 nurse, 44 social worker, and 51 special education case manager positions. The majority of the nurse positions have already been opened in order to help respond to the needs of the COVID-19 pandemic. This will result in a total of 504 nurses, 580 school social workers, and 214.5 case managers in our schools, which will each be a record high for the district.

Case manager positions are allocated directly to schools, and those funds appeared in the school budgets principals received last spring. Nurse and social worker positions are budgeted centrally and have been included as part of the FY2022 operating budget.

Continuing the Expansion of High-Quality Academic Programs

During the 2021 school year, CPS completed its third annual Academic Program Request for Proposal (RFP) process, which allows school communities to apply for high-quality academic programs to supplement their current educational offerings. Since launching the Academic RFP two years ago, we have added new academic programs to more than 50 schools. All programs that were awarded during the past two years will continue to receive funding this year, and an additional investment of $7.5 million will fund new high-quality programs that were awarded to seven schools last spring, including STEAM, International Baccalaureate (IB), dual-language, and fine and performing arts. 

These investments will enrich the experience of nearly 4,000 students, 93 percent of whom are Black and Latinx and approximately 89 percent of whom live in low-income communities. All seven schools filled programmatic gaps in their regions as outlined in the district’s Annual Regional Analysis (ARA)—a comprehensive resource that is updated regularly and provides CPS families with critical information about enrollment, school quality, and academic offerings at the CPS schools in their neighborhoods.

Highlights of these programmatic investments include:

• International Baccalaureate: More than 20,000 students at 64 schools will have access to IB programs. A new program at Kilmer Elementary School will be created to serve more than 400 additional students.
• STEM/STEAM: More than 21,000 students at 46 schools will engage in modern STEM and STEAM (Science, Technology, Engineering, Arts, Mathematics) programming. New programs will be established at three elementary and middle schools, each creating attendance area pipelines into high schools with Early College STEM and STEAM programming:
  • West Park Academy (STEAM) to North-Grand High School (Early College STEAM)
  • Ruggles Elementary School (STEAM) to Englewood STEM High School (Early College STEM)
  • Hernandez Middle School (STEM) to Solorio High School (Early College STEM)
• Fine and Performing Arts: More than 41,000 students at 72 schools will benefit from comprehensive arts instruction. New programs at Bright and Nash elementary schools will be created to serve nearly 500 students.
• Dual Language: Students at 43 schools will develop literacy and fluency in two languages through Dual Language programs. A new program will be created at Nathan Davis Elementary School.

Student-Based Budgeting Increase and Guaranteed Funding For the Year Ahead

The Student-Based Budgeting (SBB) rate for FY2022 is increasing by 3 percent to cover the cost of teacher salary increases in the year ahead. And consistent with the district’s approach since 2018, school budgets are guaranteed minimum funding levels that will not be reduced in the fall, even if a school’s enrollment declines. And if fall 2021 enrollment exceeds last year’s enrollment, schools will receive additional funding. This funding approach gives principals the ability to plan with confidence, knowing that their funding allocation will not decrease if enrollment declines.

Investing Equitably in School Buildings Throughout Chicago

Even as we address the unprecedented challenges presented by COVID-19, we remain committed to the long-term investments that will help more of our students access safe, modern school buildings. FY2022 budget includes $706.6 million in capital spending to focus on priority facilities needs at neighborhood schools, including upgrading mechanical systems which control the indoor environment and air-quality of our schools; expanding the number of full-day pre-k classrooms; increasing ADA accessibility; modernizing restrooms; improving student recreation and athletic facilities; and upgrading technology.

In keeping with the equity focus outlined in our Five-Year Vision, the FY2022 capital budget was developed using the district’s Equity Index—a tool created last year by CPS’ Equity Office to inform where resources are most needed throughout the city. The district also conducted five public meetings and evaluated more than 500 survey responses to gather community input during the capital plan development process.

Strengthening High-Quality Neighborhood Schools

CPS will invest $328.6 million to address facility needs and strengthen neighborhood schools throughout the city. Projects include rebuilding roofs and mechanical infrastructures, stabilizing chimneys, and replacing fire alarms to ensure Chicago’s school buildings remain safe, modern learning environments for years to come.

On top of this capital investment is $20.5 million to promote Americans with Disabilities Act (ADA) accessibility at 33 CPS schools. This is part of a multi-year, $100 million commitment to improve the accessibility of parking lots, main entrances, main offices, and public restrooms, and make the first floor of every school building accessible to people with disabilities.

Expansion of Free Full-Day Pre-K

CPS is continuing to build on our commitment to provide free full-day pre-k to all four-year-olds in Chicago. In FY2021, the district invested $100 million to complete classroom conversions and to renovate existing pre-k classrooms. Building on this investment, the FY2022 capital plan includes $80 million to complete the remaining expansions and classroom conversions for the 2021–22 and 2022–23 school years.

Investments to Support High-Quality Academics and Enrichment

CPS is investing $30.5 million to modernize classrooms and ensure all buildings are able to support 21st century learning environments. These investments include:

• $20 million to renovate existing student recreation and athletic resources, such as stadiums, athletic fields, and natatoriums.
• $10.5 million in building upgrades to support STEM, STEAM, IB, and world language programs at seven schools.

Site Improvements that Foster Learning

This year’s capital budget also includes $37.6 million to design and build new playgrounds, playlots, and school yards at more than 30 schools across the city so that students can benefit from a well-rounded education that promotes healthy and active development. We are also continuing our multi-year investment in the school Technology Modernization Program, allocating $46.4 million to upgrade school network infrastructure to address equitable connectivity, replace aging hardware at schools, and upgrade our data warehouse and data backups. And to support student safety at every school, $2 million will fund new security equipment including cameras, intercom phones, alarms, and screening equipment.

Investing Produces Results

The FY2022 budget provides our school communities with the resources they need to build on their record-breaking gains. In the past year, our schools have earned the following recognition and achievements:

• In 2020, CPS students achieved a new record-high graduation rate of 82.5 percent, which was propelled by the academic progress of African American and Latinx students. This graduation rate marks an increase of nearly 27 percentage points from 2011, when only 56.9 percent of CPS students earned a high school diploma.
• More high school students are staying in school than ever before, with the one-year dropout rate at an all-time low of 5.6 percent in 2020, which is down from 6 percent in 2019. These improvements were largely driven by African American students, who had a decrease of 0.9 percentage points since 2019 (from 8.1 percent to 7.2 percent in 2020), with African American males seeing a decrease of one percentage point (from 9.0 percent to 8.0 percent in 2020), the largest of any other demographic group. Encouraging trends were also seen among diverse learners, who had a 1.1 percentage point decrease compared to last year (from 7.7 percent to 6.6 percent in 2020).
• In 2020, more CPS graduates than ever––49.3 percent––earned college and career credentials while still in high school, making college more accessible and affordable for students and their families.
• The Class of 2020 was the first class to graduate under Learn.Plan.Succeed., which ensures seniors have meaningful planning conversations with dedicated staff and submit concrete post-secondary plans. More than 97 percent of seniors at district-operated schools submitted a plan, and nearly 83 percent of those plans included a college acceptance.
• Last year’s graduating class earned over $1.16 billion in scholarship offers, making 2020 the fifth straight year that students have earned over $1 billion. Expanding access to college-level programming and support from dedicated school counselors and college and career coaches have helped ensure students are aware of scholarship opportunities and receive the support they need to complete applications. More than 10,000 seniors accessed the CPS Academic Works Scholarship tool, which is a resource that pairs students with over 200 strategic scholarships that are promoted throughout the school year.
• Groundbreaking new research from the UChicago Consortium on School Research showed that nearly 80 percent of CPS English Learners developed English proficiency by eighth grade and play a key role in contributing to the district’s academic progress. The research also found that the majority of former ELs matched or exceeded the progress of their peers on key academic indicators, such as GPA, attendance, and Freshman OnTrack.
• Since the start of the pandemic, the district has provided more than 45 million meals to students at hundreds of sites across the city. Additionally, CPS distributed approximately 200,000 devices and has helped make free, high-speed Internet available to all low-income students through the groundbreaking Chicago Connected program.

The investments outlined in this budget will allow students to build on this considerable momentum and maintain the reputation Chicago has established as a national leader in education.

Impact of COVID-19 and Federal Relief Funding on FY2022 Budget

As CPS plans for a full return to school this fall, new challenges introduced by the COVID-19 pandemic require significant levels of additional investment. In response to these unprecedented challenges, the federal government has passed a series of economic relief packages to fund new costs and cover lost revenues resulting from the pandemic. These relief packages—the most recent of which includes nearly $1.8 billion for CPS as part of the American Rescue Plan—provide funding through 2024, as the financial impact of the pandemic on school districts throughout the country is not likely to be short-term.

The Elementary and Secondary School Emergency Relief Funds (ESSER) provide vital resources to address diverse needs arising from or intensified by the COVID-19 pandemic for all schools and students. CPS’ FY2022 budget includes $1.06 billion in funding from the federal ESSER II and ESSER III allocations to address students’ needs aligned to the three ESSER priority areas: 1) emerging stronger post-pandemic, with a focus on a safe return to in-person instruction; 2) maintaining continuity of service including maintaining staffing and adding additional resources in schools, and 3) resource equity addressing the disproportionate impact of COVID-19 on communities of color and communities experiencing poverty. Specific investments include:

• $267 million in funding to support year-one investment in the districts two-year, $525 million Moving Forward Together plan.
• $132 million to support student re-engagement and school opening costs in the fall, covering one-time costs related to technology, personal protective equipment, cleaning supplies, school maintenance, vaccination efforts, and other costs that may arise as CPS transitions back to a full return to school.
• $100 million to support projects focused on improving air quality by renovating and replacing school mechanical systems.
• $288 million to support school-based programmatic investments, allowing the district to continue to grow investments in the equity grant, invest in special education teachers and paraprofessionals, and expand new academic programs and early childhood classrooms.
• $178 million to fund school-based instructional positions.
• $95 million to provide a proportionate share of ESSER funding to charter and contract schools.

FY2022 Budget Overview

CPS revenues are projected to increase in FY2022, keeping the district on track for continued fiscal health after years of fiscal uncertainty. The two largest revenue sources, property tax and state Evidence-Based Funding for K-12 education, project continued growth in FY2022. The FY2022 budget is bolstered by additional ESSER II and ESSER III federal relief funding to safely open schools this fall, fund the Moving Forward Together initiative, and continue investments driving equity and academic progress across the district.

FY2022 Capital Budget Overview

CPS is committed to promoting equitable access to high-quality school environments, and equity served as the foundation for the FY2022 capital plan. The district's Equity Office played an important role in developing the FY2022 capital proposal by helping to ensure that resources are distributed fairly and equitably across CPS schools so that all students can share in the district's record-setting progress. In addition, the FY2022 capital budget planning process included several enhancements, most notably around transparency and community outreach. The district conducted five public meetings and evaluated over 500 survey responses to gather community input during the capital plan development process.

The CPS facility portfolio includes 522 campuses and 798 buildings. Our average facility age is over 80 years old, and over $3 billion is required to maintain these facilities. Since FY2016, CPS has invested over $3 billion into capital improvements across the district. These projects include major renovations to ensure our schools stay warm and dry, relieve overcrowding, add security cameras to provide a safer environment for our children, and aid programmatic enhancements. Additionally, CPS is investing $100 million over five years to ensure all CPS campuses are more accessible.

The FY2022 capital budget is primarily funded by future issuance of general obligation bonds, which are principally repaid by Evidence-Based Funding (EBF). A portion of the FY2022 budget is also funded by Federal ESSER III funds and potential outside resources as they become identified.

Full details on the FY2022 capital budget are available on the interactive capital plan website: www.cps.edu/capitalplan. The site allows users to quickly select projects by school, geographic area, type, and year.

CPS’ capital plan aligns with the priorities outlined in the draft Educational Facilities Master Plan. Future projects will be determined by equity, assessed need, educational priorities, and available funding.

FY2022 Debt Budget Overview

The Board of Education is authorized by state law to issue notes and bonds, enter into lease agreements for capital improvement projects, and assist in the management of cash-flow and liquidity. As of June 30, 2021, the Board has approximately $8.4 billion of outstanding long-term debt and $244 million of outstanding short-term debt. FY2022 includes appropriations of $763 million for long-term debt service payments. Approximately $12 million of appropriations for interest on short-term debt is included in the operating budget.

CPS’ Capital Improvement Program, described in the Capital chapter, funds long-term investments that provide our students with a world class education in high-quality learning environments. CPS relies on the issuance of bonds to fund the investments laid out in our Capital Improvement Program, which include roofs, envelopes, and windows; state-of-the-art high school science labs; high-speed internet and digital devices; playgrounds and athletic fields; and expansion of full-day pre-k and other high-quality programmatic investments. Bonds are debt instruments that are similar to a loan, requiring annual principal and interest payments.

For additional information on the FY2021 Debt budget, please see the Debt chapter of the budget book.

Appendix I: FY2021 Operating Budget Financial Performance

FY2021 year-end estimates project CPS to outperform budget expectations by $64 million and end the fiscal year with a $42 million operating surplus. Revenues in the initial FY2021 budget were $22 million less than budgeted expenditures, reflecting the district’s ability to budget unspent, restricted grant revenues from the prior year. Additionally, the district received $32 million in revenues below budget, largely due to budgeted grant contingencies that the district spends only if funding materializes.

Revenues

Local Revenue

The year-end total of property tax revenue is projected to be $32 million below the originally budgeted amount of $3.2 billion due to the impact of the Cook County Assessor’s off-cycle reassessment to account for the impact of COVID-19 on property values. As in FY2021, CPS anticipates no impact from the delay in the deadline and penalty dates for second installment property tax bills. Personal Property Replacement Tax (PPRT) revenues are projected to come in $87 million over budget due to significant overperformance of state corporate income tax receipts against expectations a year ago.

State Revenue

Under the EBF model, CPS in FY2021 is projected to receive $8 million less than originally budgeted in EBF revenues as a result of diversions to charter schools approved by ISBE being higher than expected.

Federal Revenue

Federal revenues received in FY2021 are projected to be $109 million below budget, due almost entirely to revenues impacted by remote learning. Federal nutrition revenue, which is based on the number of meals served, is projected to come in $90 million below budget as meal counts dropped significantly from typical levels when students are physically in school. Finally, CPS expects to claim $339 million of the $343 million in ESSER II funding in the FY2021 budget. This was included as “anticipated federal revenue” in the original FY2021 budget as the ESSER II funding package had not been approved by Congress at the time the budget was passed.

Expenditures

Estimated FY2021 expenditures are $96 million lower than the FY2021 budget. The underspend is driven primarily by savings from the portion of the year spent in a remote learning environment, where the district incurred expenses lower than budgeted in transportation, food service, and other operational areas. Additionally, the district incurred expenses higher than budgeted in certain areas related to remote learning and school reopening, including technology, facility maintenance and cleaning supplies, and additional school supervisory support. This additional spending was offset by a reduction in the contingency needed to provide federal proportionate share funding to non-public schools, which was not required under the final ESSER II legislation.

Appendix II: FY2022 Summary Information

The FY2022 operating budget is approximately $7.82 billion. 61 percent of the budget is tied to teacher and education support personnel salaries and benefits (including pension costs). Charter tuition makes up nearly 12 percent of the operating budget while commodities (e.g., utilities, textbooks, supplies), transportation, contractual services, contingencies, and equipment make up the remaining 27 percent.

Appendix II Chart 1: FY2022 Budget by Expense Category (millions)

The FY2022 budget includes 41,756 full-time equivalents (FTEs), an increase of 2,017 FTEs from the FY2021 budget. 97 percent of all positions in the FY2022 budget provide direct support to schools.

Appendix II Chart 2: Of the 41,756 Positions in the FY2022 Budget, 97% Directly Support Schools (FTEs)

Salaries and Benefits: 67 percent of operating expenditures in FY2021 were on employee salaries and benefits. The FY2022 salary budget reflects an increase of $127 million over FY2021 spending mainly due to cost of living adjustments for union staff and investments in school-based staff described earlier in the chapter. Benefit costs are projected to increase by $80 million over FY2021 spending levels due to increases to the pension contributions for teachers and non-teaching staff and projected growth in healthcare costs.

Contracts: This category includes tuition for charter schools and private therapeutic schools and payments for clinicians that are not CPS staff. This category also includes early childhood education programs provided by community partners and programs such as Safe Passage. In addition, this category includes repair contracts, legal services, waste removal, janitorial services, engineering, and other services. FY2021 spending is projected to be $16 million higher than FY2021 spending due to increases in charter school funding to match investments made in district schools and inflation in vendor contracts.

Commodities: Commodities include spending on items such as food and utilities (which make up the largest share), instructional supplies such as textbooks and software, and other supplies such as postage and paper. The FY2022 budget for commodities is $61 million less than FY2021 spending due to increased spending on supplies in FY2021 to facilitate school reopening. Additionally, schools typically transfer funds from contingency to commodities spending accounts over the course of the school year as needs are identified.

Equipment: Equipment pays for the cost of furniture, computers, and similar other non-consumable items. During FY2021, district spending increased in this category to provide devices to support remote learning, along with classroom technology to support hybrid learning in the later portion of the year. Additionally, this category experiences increases in spending during the year as schools transfer funds into the equipment account from other areas of their respective budgets.

Transportation: The cost of bus service is the vast majority of the transportation budget, but it also includes costs for Chicago Transit Authority (CTA) passes and reimbursement that the district is legally required to provide. FY2021 spending on student transportation was lower than in normal years due to the time spent in remote learning. The FY2022 budget projects a return to typical spending levels which reflect an increase of $22 million from projected FY2021 spending.

Contingencies: This account type includes three categories of spending. The first category represents funding that has been budgeted but not yet allocated to specific accounts or units where it will eventually be spent. Under the SBB system, schools are not required to allocate all of their funds, but can hold some in contingency while they determine how they want to spend it. Similarly, the district holds grant funds in contingency, particularly if the grant is not yet confirmed. The FY2022 contingency budget represents a significantly higher total than prior years due to the magnitude of federal funding in the FY2022 budget. Over 37 percent of these funds will support the Moving Forward Together initiative and fall school opening, and will be transferred to spending accounts as the district prepares to procure services and hire staff. Higher levels of grant contingencies are also included in the FY2022 budget to ensure the district is able to utilize any new state or federal funding that may materialize from pandemic-response strategies, including potential funding for COVID testing, technology, and other needs being prioritized at the state and federal levels.

1. As part of the restructuring of the School Support Center function, 90 FTEs shifted from city-wide student support to Central Office personnel. These FTEs will still support schools in the same capacity but now report through their functional areas (Talent and Finance).

2. The increase in city-wide student support personnel is due largely to the transfer of 734 crossing guards from the City of Chicago to the CPS budget, the addition of 400 custodians to improve school cleanliness, and 170 additional related service providers.