Illinois Republican Lawmakers Pitch State Takeover Of Chicago Schools As 'Lifeline,' Not 'Bailout'

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CHICAGO — Republican legislative leaders in Illinois on Wednesday proposed a state takeover of Chicago Public Schools and permitting the troubled district to declare bankruptcy to get its finances in order, billing the controversial ideas as a "lifeline" and not "a state bailout."

"We didn't come to this lightly, but the track record of Chicago and its public school system is abysmal," said Senate Republican leader Christine Radogno of Lemont.

House Republican leader Jim Durkin of Western Springs said "the goal here is to provide the tools to right the ship."

It's the latest move as Gov. Bruce Rauner and Mayor Rahm Emanuel continue to play the blame game over CPS' $480 million budget shortfall that threatens layoffs and has led to heavy borrowing to keep the state's largest school district afloat.

Emanuel, who is in Washington, D.C., for a national mayor's conference, has spoken out against Rauner's bankruptcy idea in the past, saying instead the state should provide more money to CPS to cover its pension costs. That position hasn't changed.

"The mayor is 100 percent opposed to Gov. Rauner's 'plan' to drive CPS bankrupt. If the governor was serious about helping Chicago students, he should start by proposing — and passing — a budget that fully funds education and treats CPS students like every other child in the state," Emanuel spokeswoman Kelley Quinn said in a statement Tuesday.

As described by the GOP leaders, the legislation would allow the Rauner-appointed State Board of Education to remove the current Chicago Board of Education and create an independent authority to run CPS until it is determined the district is no longer in financial difficulty. The leaders said the change would add CPS to a state financial oversight law that it is exempted from but that applies to all other Illinois school districts.

Another measure would allow school districts like CPS to declare bankruptcy, which could allow it to void union contracts. Rep. Ron Sandack, R-Downers Grove, acknowledged that's a possibility under the bankruptcy option.

The General Assembly, however, is controlled by Chicago Democrats unlikely to warmly greet the takeover and bankruptcy ideas. Senate President John Cullerton outright dismissed the plan, saying it "is not going to happen."

"It's mean-spirited and evidence of their total lack of knowledge of the real problems facing Chicago Public Schools. The unfair treatment of pension systems by the state is the immediate cause of CPS' financial problem," Cullerton said in a statement. "That situation ought to be addressed rather than promoting this far-fetched notion that the state is somehow in the position to take over Chicago schools. This ridiculous idea only serves as a distraction from the state's problems that these two state leaders should be focusing on."



The state covers the cost of teacher pensions in the suburbs and Downstate, but not for CPS, which has long had its own pension system. CPS instead gets more state money in other education areas as Chicago homeowners pay property taxes that cover teacher pension costs.

Durkin and Radogno tried to pressure Cullerton and House Speaker Michael Madigan on the issue.

"We are willing to help Chicago Public Schools, but we have been stonewalled by Mike Madigan and the Democratic majority to protect the status quo," Radogno said.

State lawmakers' effort to revive the bankruptcy and school finance authority options are sure to be opposed by the Chicago Teachers Union and its allied advocacy groups.

Talk of a move to re-establish state fiscal oversight of the city's schools has circulated since the summer and comes as bond ratings agencies have dropped CPS' debt deeper into junk status in advance of district plans to add more than $850 million to its overall debt load.

The city's schools have been under the state's emergency oversight before. In 1980, a district fiscal crisis that prompted banks to withhold loans from CPS prodded state lawmakers to create the Chicago School Finance Authority to supervise schools.

CPS had to submit a balanced budget to the authority, which had power to keep school doors closed until it approved or rejected district spending plans and contracts.

That arrangement lasted until 1995, when a Republican-led legislature passed legislation that gave then-Mayor Richard M. Daley control of CPS. Daley quickly sought permission from Springfield to divert district pension dollars to other uses and saw the school system take its first partial pension holiday.

On Tuesday, Rauner was asked about a CPS bankruptcy bill and took shots at the mayor.

"I'm worried that the mayor is failing. The mayor gave in and caved on the (teachers) strike 4 { years ago. Hurt the taxpayers, hurt the schoolchildren as a result. I'm very concerned about the trajectory of where we're going with CPS. And right now, the mayor's only real message to the state government is, 'Hey, we failed financially our schoolchildren, send us half a billion dollars.' That's not a reasonable position for the mayor to take," Rauner told reporters.

Rauner said he would be taking unspecified "action to protect the schoolchildren so they have good access and they have teachers and they have effective classrooms. And we're going to protect the schoolchildren and the taxpayers as well."

Chicago Public Schools CEO Forrest Claypool fired back, calling the governor's comments "deeply irresponsible." The Chicago Teachers Union and district negotiators met again Tuesday in an effort to replace a contract that expired over the summer.

"The governor is defending a school funding system that is separate but unequal," Claypool said in a statement.

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