Chicago Schools Face Budget Cliff as Classrooms Reopen, Thousands of Jobs at Risk

Chicago Public Schools (CPS) students are heading back to classrooms this week amidst a swirling storm of budget uncertainty, with the district's approved $10.11 billion budget for the 2026-2027 school year precariously balanced on $150 million in unconfirmed state funding. This financial tightrope walk has school leaders warning of potential credit downgrades, higher borrowing costs, and even mid-year cuts if the promised state dollars don't materialize, casting a long shadow over the new academic year just as classes resume. The district is grappling with a projected $732.5 million budget deficit, a crisis fueled by the depletion of federal COVID relief funds, escalating operational expenses, and a notable decline in student enrollment since 2019. While the Illinois State Board of Education announced a statewide increase of $350 million in education funding for FY2027 under its Evidence-Based Funding formula, this doesn't guarantee the specific $150 million CPS is banking on. The Chicago Teachers Union has fiercely pushed back against proposed staff cuts, urging state lawmakers to convene a special session to fully fund schools and even suggesting legal action against the Cook County Treasurer for delayed property tax distributions, which severely impacts CPS cash flow. With schools having to finalize budgets by early June and the Board of Education legally bound to approve a full budget by late August, the clock is ticking. CPS officials, including CEO Macquline King, have expressed grave concerns that without the assumed state revenue, the district might struggle to make September payroll, potentially disrupting the start of school and forcing painful mid-year adjustments like further layoffs and increased student-to-teacher ratios, mirroring past crises that led to widespread programmatic cuts.