Chicago Public Schools CEO Forrest Claypool is taking a 20 percent whack at his executive budget — and laying off nine senior aides drawing $1 million in salaries — to dramatize the sacrifice needed to put more money into the classroom.
Claypool ordered the largely symbolic cuts as he prepares to unveil a 2016 budget that assumes CPS will receive $500 million in pension help from Springfield. Help that may never come.
Without it, Claypool has said he would have no choice but to order another round of “unsustainable” borrowing and mid-year budget cuts that would dramatically hurt students.
For more than 30 years, Claypool has been a go-to guy for Chicago mayors and local politicians, dispatched to troubled government agencies to cut the fat, challenge entrenched bureaucracies and battle unions.
Wherever he goes, the playbook has been the same. Start by cutting the heck out of your own executive budget. Then move on to the tougher job of challenging costly union work rules.
Now Claypool is bringing to CPS the strategy he executed at the Chicago Park District, the CTA and during two stints as former Mayor Richard M. Daley’s chief of staff. Claypool had planned to do the same as Mayor Rahm Emanuel’s chief of staff before the resignation of CPS CEO Barbara Byrd-Bennett altered the game plan.
Claypool is cutting two employees on his own, 10-member staff. In addition, nine senior executives who together collect $1 million in annual salaries are being laid off, including the last two in a cadre of educators hired by Byrd-Bennett.
The targeted employees include Jack Elsey, a $165,000-a-year “chief innovation and incubation officer” who oversaw charter schools after following Byrd-Bennett from Detroit to Chicago. That comes on top of the $15.8 million in cuts already ordered to startup funding for newly approved charters. The other Byrd-Bennett holdover is Nikki Bolden. She’s a $105,000 “director-talent generalist.” That’s CPS-speak for human resources.
Last week, Elsey refused to discuss his being laid off. Bolden also declined to comment.
In a farewell letter to his colleagues in the education community, Elsey wrote that, while “my heart is heavy,” he believes the charter and contract school movement is “in good hands” with Claypool and newly appointed chief education officer Janice Jackson.
The hit list also includes a $152,000-a-year “director of strategy management”; a $139,615-a-year executive director of sports administration; a $127,417-a-year internal audit officer; a $103,115-a-year “senior program development analyst”; a $100,000-a-year director of media affairs; an $80,000-a-year executive assistant; and a special assistant with a $55,000 salary.
Along with the staff cuts, Claypool is ordering reductions in professional membership expenses ($70,000); travel ($12,000); consulting ($8,000); and rental expenses ($8,500) in his office.
Also biting the dust is a “staff shuttle” from the central office to satellite locations that cost $60,000 a year. The shuttle made 20 trips a day and transported 13 people to an information technology office in Bridgeport and a personnel office in Garfield Park.
Claypool is also making a $250,000 change to the vacation policy for 49 senior managers. Instead of being entitled to five weeks of vacation on their first day of work, they’ll be required to earn their vacation time based on years of service. The maximum vacation time will be four weeks, instead of five. And it’ll take CPS executives 10 years to build up to that maximum.
Together, the layoffs and policy changes will save $1.7 million. That’s a drop in the bucket compared with the $1.1 billion budget shortfall and $9.5 billion pension crisis that CPS faces.
But sources said it’s a prelude to a “major restructuring” of the CPS bureaucracy. And the first step helps to deliver on the promise Claypool made on the day he became the seventh CEO at the Chicago Public Schools since Arne Duncan left in 2009 to become U.S. education secretary.
That is: to “manage the system and make it as efficient as it can possibly be” to free up the money needed to support principals, teachers and students “in every conceivable way.”
“Chicago is the only city in Illinois that has to take money out of the classroom in order to fund pensions. That is unacceptable. But I’ll deal with what we can deal with. That is to manage the system as best as possible,” he said on that day.
Last month, Emanuel’s plan to have CPS effectively borrow $500 million from the Chicago Teachers Pension Fund to ease a “cash-flow crisis” was shelved just days after it was introduced.
Days before the talks fell apart, CPS Chief Administrative Officer Tim Cawley had portrayed the five-month, $500 million loan as the alternative to cuts massively more painful than the $200 million in cuts already triggered by a $634 million payment to the teachers pension fund.
Cawley warned that without the loan, the size of classes would have to be increased to 35 students. Three thousand teachers would have to be laid off, triple the number of job cuts previously announced. And furlough days would be triggered systemwide.
But when individual school budgets were released, there were no additional cuts.
Instead, CPS decided to make a $500 million gamble that the General Assembly would correct what Emanuel and Claypool have called a “structural inequity” that has forced Chicago taxpayers to pay twice, once for the pensions of the city’s retired teachers and again for retired teachers outside Chicago.
Standard & Poor’s has raised concerns about the “vulnerabilities” of the board’s plan to count on $500 million in teacher pension relief at a time when Republican Gov. Bruce Rauner and Democratic legislative leaders are embroiled in a protracted state budget stalemate over Rauner’s demand for pro-business, anti-union reforms.
But even as Rauner started pointing fingers at his old friend Emanuel last week, Claypool saw progress.
“We now have on record the governor, the speaker of the House and the Senate president saying pension inequity in Chicago versus the rest of the state cannot stand and should be addressed,” he said.
Emanuel has offered to raise Chicago property taxes by as much as $225 million for schools, but only if teachers accept the equivalent of a 7 percent pay cut and the state reimburses CPS for “normal” pension costs.
Rauner has embraced the idea. Chicago Teachers Union President Karen Lewis has rejected it. She also has threatened to take her members out on strike over the issue — for the second time in three years — even though the earliest that could happen is January. That’s because teachers contribute just 2 percent toward their own pensions. CPS agreed to the 7 percent “pension pickup” years ago in lieu of a pay raise.
Claypool has said he foresees no solution under which CPS could afford to continue that arrangement.