Rauner won’t sign education funding reform bill with $300M for CPS

Gov. Bruce Rauner said Thursday that he would not sign an education funding reform bill that passed both chambers of the Illinois General Assembly Wednesday night just before the regular legislative session ended.

But Senate Democrats say they’re waiting for “cooler heads to prevail” and filed a procedural hold on the bill — preventing a 30-day clock from starting on having to deliver the bill to his desk.

The bill would add close to $300 million in additional state funding for the Chicago Public Schools, and potentially more in subsequent years. And it would, for the first time in the history of the state ranked last nationally in funding schools, send any new education money first to districts most in need.

“In its current form, absolutely not,” Rauner told the Chicago Sun-Times when asked if he would sign it. “The amendment on there really amounts to an unfair-to-Illinois-taxpayers bailout of CPS.”

John Patterson, spokesman for Illinois Senate President John Cullerton, said the bill’s hold is meant to give the governor time “to recognize that we’re delivering a win to his desk.”

“It’s been 20-plus years in the making and a lot of people on both sides of the aisle have dedicated themselves to this cause over those two decades,” Patterson said. “We’re trying to avoid conflict and rash actions. We would urge the governor to take the win.”

Based on discussions with a bipartisan educational funding panel commissioned by Rauner, the legislation divided the state’s school districts into four tiers, based on their needs for low-income, special education and English-learning students; it placed CPS squarely into Tier 1, which is for the neediest districts that are set to get more money per student than those in the other tiers.

No school district would lose any funding under the legislation, which instead assigns new money to be distributed according to need. An amendment added Tuesday evening by Rep. Will Davis, D-East Hazel Crest, is where Rauner placed the blame.

He said bills drafted by State Sen. Andy Manar, D-Bunker Hill, and Sen. Jason Barickman, R-Bloomington, should be used as a “base for a deal.”

“We were going down that road but then the majority in the House kind of hijacked the process, added a big addendum, a big amendment onto Manar’s bill with massive more financing for Chicago Public Schools. That’s not fair for the statewide taxpayers. So we’ve got to get that out,” Rauner said. “Within the context of the bills I think coming up with a balance that works for everybody and gets more resources for Chicago Public Schools, I’m supportive of that. So hopefully we can keep working to get it done.”

Before Rauner made his feelings known, Mayor Rahm Emanuel had praised the bill.

“I want to thank the members of the state legislature for coming together to pass meaningful legislation that will strengthen education funding for every district in the state, and better support students and families throughout Illinois,” Emanuel said. “This bill will bring much-needed stability to Illinois school districts, and I hope the governor does what is in the best interests of children across the state and signs this bill into law.”

Emanuel’s administration has maintained that the long-sought changes to the school funding formula would generate nearly $300 million in additional funding for the Chicago Public Schools in the first year and even more in subsequent years.

That’s nearly 40 percent more than the $215 million in state pension help built into the CPS budget and vetoed by Rauner because it was not tied to state pension reforms.

With that money and $389 million in short-term borrowing secured by late block grants owed by the state, CPS expects to have enough money to make a state-mandated, $720 million payment to the Chicago Teachers Pension Fund due on June 30.

But City Hall also is bracing for a “political stunt” before the borrowing — with what’s expected to be an exorbitant interest rate — is finalized.

“We fully expect the governor to pull a political stunt and try to undermine the CPS financing,” said a top mayoral aide, who asked to remain anonymous.

“Last time, he floated a bill to pave the way for CPS to declare bankruptcy and threatened to have the State Board of Education take over CPS. He did a press conference the day of the borrowing. He didn’t have the authority to do that. But it was a stunt to mess with CPS that cost us $400 million in financing.”

Asked directly about talk of bankruptcy, Rauner said “I don’t know about that. Haven’t heard about any of these rumors.

“I care very much about Chicago Public Schools. I care very deeply. My wife and I have spent much of our lives and our financial resources and our time trying to help improve Chicago Public Schools. But I work for all children in the state and all teachers in the state and we need to have a system that’s balanced and fair for everybody,” he continued.

But the legislation would have benefited poor districts throughout the state, said Ginger Ostro, head of Advance Illinois, an education policy group that has long championed funding reform and supported this recent effort.

Illinois currently spends just $.81 per dollar on poor kids for every dollar it spends on kids who aren’t low income, she said. And it allocates what money it spends on a per-pupil basis so each district, regardless of ability to pay, gets the same amount for each special ed or low-income student.

“And that’s why we think it’s a historic triumph for students,” she said. “That the General Assembly has come together and passed this legislation is profoundly significant. We do encourage the governor to sign it.

“We encourage him to look at the benefits to districts across the state to children that have been waiting and districts that have been struggling not being able to provide up to date textbooks or as many teachers per student they would like.”

In aldermanic briefings last month, City Hall tried to frame the schools’ cash crunch as a $1.1 billion crisis caused by Rauner’s actions over the last two years.

Emanuel’s proxies argued then that Rauner’s decision last year to threaten a state takeover and pave the way for a CPS bankruptcy forced the school system to shrink its planned borrowing by $400 million and pay an exorbitant interest rate of 8.5 percent.

The crunch was then compounded by Rauner’s veto in December of $215 million for pensions CPS built into its budget despite strings attached to the money, and then again this spring by a delay in $467 million owed to CPS in block grant money that’s yet to arrive.

Rauner has said the agreed-upon conditions for the pension money were not met.

Hours before the school funding formula was revised, Emanuel argued once again for the state to right a fundamental wrong.

“When it came to funding from the state of Illinois, which is dead-last in funding education, it treated the children of Chicago and treated poor children specifically as second-class citizens. And that’s not right. Nobody believes that’s right,” the mayor said.

“They’ve worked through the issues so everybody moves forward and most importantly, the school districts that have a concentration of poor kids get the assistance they need financially. Money doesn’t solve the problems alone. But without it, you can’t make gains…

“I would say to the governor: ‘Fix what is broken: K-through-12 funding. You put a commission together on formula 120 days ago. … You said it was a road map to legislation. … It’s time everybody come together to fix what is broken.’”