Jan. 21--Gov. Bruce Rauner and Republican legislative leaders on Wednesday tossed what they called a "lifeline" to Chicago Public Schools, a district so swamped by debt and short on cash that it could collapse before the end of the school year.
The Republicans proposed a law that would allow the Illinois State Board of Education to take over CPS, to appoint an oversight authority to get the district's finances in order. A separate measure would allow CPS to seek protection in bankruptcy court, which state law now doesn't permit.
CPS and state Democratic leaders promptly threw the lifeline back.
Senate President John Cullerton called the proposals "ridiculous" and "mean-spirited."
Mayor Rahm Emanuel said handing over control of the schools "makes zero sense."
Schools CEO Forrest Claypool branded the proposals "a sideshow" and "a reckless smokescreen."
We pause here to listen to all the fresh ideas Democratic leaders have offered to prevent CPS from collapsing, aside from pleading with lawmakers for $480 million that the Chicago school board baked into its budget purely in hopes that state lawmakers would provide it.
What we're hearing is that the school district will resort to yet more borrowing, or to a one-time gimmick like a dip into tax-increment financing revenue, in order to stagger to the June 21 end of the academic year. Or the schools will close before then.
If CPS and its teachers can't reach a deal on a new contract by Feb. 1, a strike countdown starts. Teachers could walk out of classrooms by late May, just weeks before the scheduled end of classes.
Claypool has warned that massive teacher layoffs could be announced in early February unless there's a new contract or lawmakers fork over that $480 million.
Pink slips likely will start going out to CPS central office workers within days.
Last week, Standard Poor's slashed CPS' credit rating deeper into junk. CPS borrows money at staggeringly high interest rates.
The GOP proposals recognize reality: The Chicago school financial crisis is here.
We understand there's political gamesmanship afoot. Rauner has tried to put more pressure on Emanuel as the standoff over a state budget drags on. Rauner didn't mince words Wednesday. "The mayor has failed" to fix CPS' finances, Rauner said. "He's failed on public safety, he's failed on schools, he's failed on jobs in the neighborhoods, he's failed on taxes, he's failed on reforms. And I'm tired of it. We have to take action."
Chicago, with the help of Springfield, does have to take action, does have to find a way to sustain the school system.
Why are Democrats so loath to give the schools the option of bankruptcy protection?
It would be a political embarrassment to them, yes.
Here's another likely reason: The bond markets will keep lending to CPS at outrageous interest rates only if the markets know taxpayers are on the hook to pay back all that borrowing. Introduce the possibility of debt restructuring in bankruptcy, and CPS could be shut out of those markets.
