Illinois' State Funding for Education: Will Schools Open Without Disruptions?

Recently we discussed changes to the graduation requirements in Chicago’s public school system, but there is a far more important topic that is having an impact throughout the entire state and that's the allocation of funds for education. 

Now, just so that you know…the majority of any state’s budget for education comes from the state itself and local governments.  The federal government only provides about 8.5%, on average, of the education budgets for various states and the rest comes from state and local sources, including property taxes.

According to the Census Bureau’s 2014 Public Education Finances report, Illinois gets well over 90% of its funding from state and local sources—so the state is in charge.

Census Bureau 2014 Education Funding Report

The majority of Illinois' funding comes from state and local sources. 

Illinois has been without a finalized budget since 2015, but recently the state’s legislature passed a budget, and then overrode the governor’s veto, to give Illinois its first official budget in two years.

During those two years, the state racked up a large amount of unpaid bills, but this budget does not solve the issue of school funding for education because these allocations have to be distributed in an "evidenced-based" manner, which doesn't quite exist yet in Illinois.

Reportedly, Illinois has one of the least equitable funding systems in the entire country with the state contributing the smallest amount in terms of state funding to its public schools. 

Given the fact, also, that property taxes factor strongly into the funding for local school districts, Illinois also, reportedly, has the largest gap between richer and poorer school districts--with some districts receiving about $5,000 per student and others receiving about $32,000 per student.

The problem is clear to everyone and everyone agrees that Illinois has to fix its funding system for the sake of its future, but there is strong disagreement when it comes to Chicago.

The legislature passed a funding bill called, Senate Bill 1 (SB1), to address already-identified needs in its education system and issues that were raised by a bi-partisan commission that was convened to study the topic of equitable education funding in the state.


This bill, SB1:

  • Sets “adequacy targets” for each of the 860 school districts in Illinois.  In other words it tries to determine the amount of funds needed to adequately educate each student, in each district and thus it sets an "adequacy target" for each school district.
  • The bill takes into account each local area’s ability to raise its own money and the amount of funding a local district already receives from the state.
  • It then adds to that base amount, overtime, to ensure that each school district reaches its "adequacy target".

This bill takes into account costs for development, demographic differences and a host of other factors.

The bill would also require state funding to first go to school districts that are the farthest away from their “adequacy target”.

The new money would phase in over the next ten years to help create a more equitable funding system in the state of Illinois, but a disagreement lies in Chicago.

In Chicago...

Chicago Public Schools is the largest school system in the state of Illinois, with 1 out of every 5 students in the state going to a school in Chicago.  Chicago would, thus, get 20% (1/5) of the state funding under this new bill.

At issue, however, is Chicago’s teachers' and staff pension payments.  

Chicago is THE ONLY SCHOOL DISTRICT in the state of Illinois that pays for its teachers’ pensions--all other districts get funding from the Illinois state government for their pension payments.

Under this new bill the state would give Chicago funding for current pension payments and past payments (that some believe were not properly administered as it relates to the pension plan). 

Critics of this bill believe that this bill amounts to a bailout of Chicago Public Schools and that the subject of pensions should not be addressed in the funding formula for education.

Proponents of the bill believe that Chicago is already paying for pensions that no other school system in the state has the responsibility to do and that Chicago's taxpayers' money goes to covering other school districts' pensions as well, therefore Chicago should be made whole as it relates to the burden it is carrying.

The bill would not stop Chicago Public Schools from paying for its teachers' pensions in the future, it would just give it money to meet current and past funding requirements.

The governor, however, has promised to veto the bill partially, to address the issues surrounding Chicago Public Schools' pensions.

The governor has also threatened to call the legislature back for special sessions, next week, and asked that a new solution be proposed.

The bill addresses allocations for the entire state and if a new evidence-based formula is not put in place school systems, throughout Illinois, would have to open without funding from the state.

These issues are not unique to Chicago or Illinois.  School districts and states all across the country are going to have to face operating their schools with less funding (perhaps less funding from the federal government if deep cuts in education are approved), while paying their teachers and workers living wages and funding their retirements.

Therefore, these issues that are playing out in Chicago, should be of interest to everyone. 

We will continue to follow this story closely.


© Red and Black Ink, LLC, 2017.

Bosman, Julie.  “Illinois Lawmakers Override Budget Veto, Ending Two-Year Stalemate.”  New York Times, July 6, 2017.  

Burnett, Sara.  “A look at Illinois’ historic budget impasse, deal to end it.”  Washington Post.  July 6, 2017.

Masterson, Matt.  “How SB1 Would Rewrite Illinois’ Broken Education Formula.”  WTTW Chicago Tonight:  Education.  June 7, 2107. Accessed July 2017. 

Silets, Alexandra.  “The Battle Over School Funding Bill.”  July 10, 2017. WTTW Chicago Tonight:  Education.

Danita Smith