Despite “roughly a decade of largely holding the line or even boosting school budgets” through COVID-19 pandemic assistance, Chicago Public Schools (CPS) must now plan for leaner times, a recent analysis concludes.
“In recent weeks, CEO Macquline King has floated a worst case budget deficit of up to $1 billion,” wrote Mila Koumpilova for Chalkbeat Chicago.
“A source with knowledge of the situation told Chalkbeat the district is planning with a gap of about $700 million in mind. Unlike the worst case scenario, that number assumes an influx of some revenue from a special city taxing program meant to spur development — and no CPS contribution to a city pension fund that covers CPS support staff and city employees.”
Regardless of which scenario the district chooses, the source told Chalkbeat school-level cuts are “inevitable.”
“The moment is putting to the test a school budgeting approach the district introduced a couple of years ago while it was still relatively flush with federal pandemic relief,” Koumpilova wrote. “It was meant to deemphasize student counts and help higher-need schools by guaranteeing minimum staffing numbers regardless of school size and allocating additional dollars based on an Opportunity Index that factors in student demographics and other metrics.”
However, this method has served to widen the financial gap between larger and smaller schools – in effect, penalizing those campuses serving more students.
“CPS high schools with 500 students or more — many of them in better-to-do communities though often serving diverse students from multiple ZIP codes — now get well less than half of the almost $35,000 per pupil that smaller high schools receive on average.”
‘Dangerous levels of indebtedness’
The district has long drawn community ire over its “dangerous levels of indebtedness,” which stems in part from constant bickering over how to account for pension plans and salaries, according to the Chicago Tribune.
“There isn’t enough money, either in the city’s budget or in the school district’s, to pay for school workers’ raises and for what the city says should be the schools’ part in keeping a deeply underfunded pension plan from sinking into insolvency,” editorialists wrote in 2025.
“Keeping straight on which governmental body owes what to which other agency and the rationale each offers for why the other should pay is difficult for journalists and finance experts. Imagine how confused ordinary taxpayers are by this ridiculous, irresponsible, intergovernmental spat.”
Beyond insolvency, the district has also made headlines for multiple instances of financial mismanagement.
The district’s office of the Inspector General (OIG) called earlier this year for more than $1 million to be paid in restitution for fraud, including one case where a staffer consistently overstated enrollment numbers.
“With respect to fraud and financial mismanagement, this was arguably the most egregious conduct covered in the annual report,” said Philip Wagenknecht, the district’s inspector general. “It wasn’t a clerical mistake or an accident.”
