Numbers Don't Lie: Why Closing 54 Schools Won't Fix Chicago's Money Mess
Numbers don't lie, people do. Mayor Rahm Emanuel and schools CEO Barbara Byrd-Bennett have been promising enormous savings to Chicago Public Schools if they are allowed to close 54 schools.
I'm not a statistician, but I do basic math just fine. My calculations show that it would take two and a half years before the school closures saved CPS just 1.8 percent of its operating budget.
A recent press release from the CPS sought to refute my doubts: CPS will save $560 million in capital funds over the next decade. It will also save $43 million annually in operations costs, for a total of $430 million over 10 years.
Let's do the math:
• $560 million + $430 million = $990 million over 10 years
• This equates to a savings of about $90 million per year, which is 1.8 percent of the district's $4.87 billion operating budget.
• CPS will add $240 million in costs THIS year for school consolidation services, air conditioning, etc.
Now take into account the following:
• The school system faces $1 billion in shortfall come July 1, 2013 for fiscal year 2014.
• The new teacher contract will cost $295 million over four years—$103 million in first year.
• CPS must also make a $330 million overdue pension payment in 2014.
In all, CPS needs to find $1.43 billion by THIS coming July.
The Illinois Board of Education requires CPS to submit a balanced budget or attach a three-year deficit reduction plan that is monitored closely by the state agency.
CPS can also borrow money and refinance debt to meet its obligation.
Humm ... CPS needs $1.43 billion by July so it decides to close 54 schools in June—disorienting 30,000 low-income, minority children and enraging city residents—so that in two to three years (when the initial invest of $240 million breaks even) the district can save $90 million a year for ten years?
That logic is tantamount to me having a $1,430 bill due, charging $240 on a credit card to hire a consultant to tell me how to save $90 a year towards my debt for the next ten years.
Neither of these scenarios makes sound economic sense!
So I'm left to wonder, What does CPS really have up its sleeve? The district is obviously not being transparent about how it plans to attack its deep debt problem. We know what its five-month plan is—closing 54 schools, co-locating 11 others, turning around six. But we also know that the closures would do nothing to fix the district's immediate money mess.
What is the district's one-year strategic plan? Its three-year, five-year, and 10-year plan?
Here's what I think (and I hope I am wrong): Educators need to brace for massive teacher layoffs.
CPS has already warned its charter schools to prepare for a 15 percent cut in funding in the fall. In May, the mayor-appointed school board will to take a final vote on the closure of about 15 percent of the district's schools.
In the past two fiscal years, the system has managed to close deficits totaling $1.4 billion while leaving the classroom mostly untouched. The district turned its central office staff into a skeleton crew, slashing a significant amount of programming, as well. The city also raised property taxes to the legal maximum and pulled millions of tax revenue from the Tax Increment Financing (TIF) fund. Some teachers were laid-off, but the pain was more of a district-wide pinch than a T.K.O.
Today, the areas for large painless cuts are few. And since neither Emanuel nor Byrd-Bennett have offered concrete sources for new revenue, there aren't many options left for filling the district's billion dollar budget hole.
Alas, the teachers!
It won't feel any better to blame the budget crisis for hundreds of teacher pink slips rather than the school closings. In fact, it would only serve to reveal the lie that the schools closing—the largest ever to be performed in any American district—was designed to save the budget.
Never mind the school closures' steep racial implications:
• About 88 percent the children who must move schools are black and nine percent are Hispanic.
• A large number of the schools that are set to close are named after prominent African American historical figures including Crispus Attucks, Jesse Owens, Marcus Garvey, Benjamin Banneker, Mahalia Jackson, Garrett Morgan, and Mary McLeod Bethune.
• White students make up only eight percent of the district's student population, but 34 percent of the city's top five selective-enrollment high schools.
Closing 54 schools may make CPS more manageable by having fewer buildings to govern, but it won't help the district reduce a dime of its immediate debt. In fact, based on the numbers, the resources CPS provides to schools may have to decrease in the coming years.
In fairness to the Emanuel, he recently said he didn't decide to close schools based on "numbers on a spreadsheet." He said the school closings are intended to increase the quality of education across the city more than to save a buck. While his sentiments are laudable, large savings were indeed touted to justify the urgent need to close dozens of schools. Downplaying the fiscal impact now only raises the suspicion and distrust.
Forcing kids to across into a rival gang territory to get to school could be extremely dangerous. With students' safety at stake, the discourse surrounding these closures needed to be honest, transparent, and beyond reproach. It wasn't. The numbers are in, and the cost-saving argument simply doesn't add up.
The Chicago Teachers Union, education advocacy groups, and upset parents are preparing to file lawsuits and engage in acts of civil disobedience. Tensions are high, and I suspect some protests could get ugly.
**Art by Lindsay Johnson added 4/28/13. She pictures Mayor Rahm Emanuel and CPS CEO Barbara Byrd-Bennett trying to fix their rickety raft while unknowingly heading toward an iceberg.