CPS to use $24M to modernize schools amid state pension crisis

September 17, 2013 (CHICAGO)

The mayor calls it school modernization, which means spending money on additions, improvements and new construction. The city says some of the dough is coming from TIFs, but much of it is coming from the state … a state that is broke.

For a third day in a row, Mayor Rahm Emanuel has walked into Chicago public school with some good news.

"A year ago, you mentioned you needed a new playground, I'm a year late, but it is coming," said Mayor Rahm Emanuel.

A new playground and upgrades at three schools on the West Side, a new annex on the Northwest Side and a brand-new school on the Southeast Side. It's millions of dollars of investments after closing 50 schools and laying off 3,000 employees. The money to pay for all this is coming from TIF funds, but most of it is state capital dollars.

"On one level, the State of Illinois has over $6 billion in unpaid bills, owes over $100 billion in unfunded pension liabilities, and now has found new money as a surprise to be available for new school construction in Chicago," said Laurence Msall, Civic Federation.

The Civic Federation's Lawrence Msall says the money apparently comes from internet horse racing gambling. He says because the state operates without a capital improvement plan, taxpayers are usually the last ones to know about how money is spent.

Msall and others say the focus should be on fixing the pension problem, rather than handing out and spending capital dollars.

"We added up all the numbers for all the debt that is in Chicago, we found $63 billion. That's more than $61,000 for every household in Illinois," said Ted Dabrowski, Illinois Policy Institute.

Libertarian group the Illinois Policy Institute says if pensions are not fixed, that $61,000 debt per household will mean paying for it through cuts in services and a huge increase in property taxes. As he defended his school spending, even the mayor admitted property taxes will go up 150 percent without state pension reform.

"Springfield will step up. That is plan a and that is plan b, we don't have an option," said Mayor Emanuel.

Emanuel spoke from Al Raby High School on Tuesday morning. Al Raby is one of the CPS schools that will see major upgrades like air-conditioning, computer labs, a mock courtroom, a broadcast TV studio, culinary center and playgrounds. Students will see the changes by spring of 2014, he said.

"We are just scratching the surface of what needs to be done in the city of Chicago. But these are the right investments because we are making the right choices for our children," Mayor Emanuel said.

But so far, Springfield has been silent. A bi-partisan pension reform committee has been working on a deal all summer, but they have yet to come up with a plan. In the meantime, the state and city continue to receive credit downgrades, which translates into an even bigger debt.

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