Chicago Public Schools to Return $87.5 Million in Education Funds to the State

Chicago Public Schools is returning nearly $90 million in education funds that will be redistributed to more than 750 Illinois school districts, following a coding error by the State Board of Education.

The Chicago School Board on Wednesday authorized a repayment plan of about $11 million per year over the next eight years. The agreement comes months after the Illinois State Board of Education announced that it discovered an error that led to it overpaying CPS by $87.5 million since 2019.

The state has worked to increase funding to schools most in need under a law that took effect in 2018. The evidence-based funding model uses a complex calculation to determine the amount of funding. money a district needs to provide adequate education. The state aims for every district to achieve 100 percent “adequacy” by 2027.

Under the state formula, Chicago is currently adequately funded at 68%.

“There is a deep unfair irony in the fact that they recognize that they are not fully funding us and then take back the money they gave us,” said Elizabeth Todd-Breland, a member of the Chicago school board.

Todd-Breland said the agreement to reimburse the state for its mistake would add a burden to funding programs, especially since the city has appealed to the district to help pay pension payments. The district has paid millions for Chicago’s underfunded pensions since 2020. The cost was previously covered by the city.​​

“We try to do a good job here for the kids,” she said. “We need the money to do that and to meet the needs that we know are becoming increasingly important for our young people.”

According to a presentation posted on the state board’s website, an entrepreneur overestimated the number of students enrolled in state-licensed charter schools in Chicago between 2019 and 2022.

Chicago Public Schools were overpaid $6.7 million in 2019, $17.9 million in 2020 and 2021, and $44.9 million in 2022, according to a state audit report.

Funds reimbursed by Chicago Public Schools will be distributed to more than 750 districts. The largest amounts — between $2 million and $5 million — will go to Elgin U-46, Rockford District 205, Plainfield District 202, Community Unit School District 300 in Algonquin and Waukegan District 60.

Following the error, ISBE reverted to in-house enrollment calculations and independent verification of future average student enrollment ratios, Chief Financial Officer Robert Wolf said during a webinar in April.

Miguel Del Valle, president of the Chicago Board of Education, praised the district attorney for negotiating a payment plan that “doesn’t hit us right away.”

“We were able to negotiate a plan that still hurts,” Del Valle said, “but it would have hurt even more if we had just given in to them in terms of asking about the mistake they made.”

Reimbursement for Chicago Public Schools will take place in fiscal years 2023 and 2030.

Mauricio Peña is a reporter for Chalkbeat Chicago, covering K-12 schools. Contact Mauricio at [email protected]

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