Report: CPS to run out of money this summer

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CHICAGO - Chicago school officials are in a time crunch to find cash the district doesn't have.

CPS owes the Chicago Teachers' Pension Fund more than $600 million by June 30.

In order to pay that bill and other costs, the district would likely have to max out its credit, drain its checking account and use money set aside to pay other debts.

A consulting firm is recommending the City of Chicago enact a capital improvement tax to help CPS collect an estimated $50 million more in property taxes each year. This tax is above the limited annual increases CPS can already make.

The school district also faces a potential $228 million bill for costs related to interest rate swap contracts. It currently only has $174 million set aside to cover those costs.

Last month, Moody's Investors Service downgraded the school district's creditworthiness to junk status.

The budget issues mean CPS may have to layoff teachers and increase class sizes.

The Chicago Tribune contributed to this report.

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  • joe

    The CTU and CPS need to go. Do people realize that the yearly cost (all in costs) for one student is over $18,000! Just look at all the administrators making over a quarter of a million dollars per year. I say let them go broke and privatize the school system.

    • M Taylor

      You must not have a child in cps! How would you like it if we privatized your job???? Blame the politicians they handle the money not the teachers !!! Dumb comment!!

  • Bill

    Looks like its time for Chicago/Illinois to pay the Piper
    This is the beginning of the bankruptcy …about to get a lot worse before it gets better.

  • John

    I don’t get the Chicago tax payer. They’ve known for years the city was being destroyed financially by Daley, yet they voted him in year after year. Now we are already seeing the same pattern with garbage Rahm Emanuel. Can someone please explain this too me?

  • Typical

    This is typical. One would have to be looking the “other way” if you didn’t think that this type of nonsense was not coming. The patients have been running the asylum for
    Sometime now in Chicago and Crook county.
    From everything that I have read sadly, Chicago will probably go the same way as Detroit did a few years ago very soon.
    There is simply not enough money to pay the bills once the gangsters, corrupt politicians, friends, families and the state get their monies.
    I think I have to look seriously to getting the family to move, maybe DuPage county, west or south west suburbs.

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