Chicago Public Schools’ financial woes might be worse than originally thought as the school district says it is a quarter billion dollars short on what it is owed from Cook County – and that’s on top of a $730 million budget gap for next year.
It all stems from ongoing troubles the county has had modernizing the property tax system, leaving taxpayers waiting and local agencies like CPS drowning in red ink.
The overall problem is more than a decade in the making, stemming from a troubled 2015 contract with a company called Tyler Technologies to modernize the county’s property tax system. It’s caused the county repeated delays in sending out property tax bills, meaning agencies like CPS have to borrow to make ends meet.
CPS says it paid $30 million in interest and penalties last year alone due to the late payments.
And this year, CPS claims the county has shorted it $250 million of what it was owed from the first installment.
“Ultimately, every dollar spent navigating these administrative shortfalls is a dollar taken directly from student instruction,” a CPS spokesperson says.
A spokesperson for the Cook County Treasurer’s office said “money is being held due to a collection adjustment” and blamed “ongoing distribution and reporting defects in the Tyler Technologies System.”
“They said they could do this for tens of millions of dollars, but we don’t have a system,” said Cook County Commissioner Bridget Degnen. “The question is, why didn’t they do what they promised to do in the original contract?”
A Cook County Inspector General report puts the blame on the company as well as separately elected public officials that run the system – including the president, treasurer, board of review, clerk, and assessor’s offices.
Jim Thompson, director of assessment and tax policy for the county, says he’s confident all parties involved are close to getting the kinks out of the system.
“They’re working on the goal of improving the schedule this year, which is improved by more than two months, and then working to get it on time again by next year,” Thompson said.
Thompson says the county is offering a $300 million loan program to local governments – like towns, libraries and school boards – who need to borrow to make payroll.
“It’ll provide funding for operations for those two months when they would have gotten their revenue,” Thompson said.
CPS, however, is not eligible for that loan – Thompson says the county is in ongoing talks with the school district to figure out a way to help them out with the lost revenue due to this current property tax delay.
Meanwhile, a statement from Tyler Technologies says they agree with the inspector general report and remain fully committed to finishing the project.
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