Ernst and Young: Chicago Public Schools to Run Out of Cash This Summer

The Chicago Sun-Times reports:

The Chicago Public Schools will “run out of cash as early as this summer” and be unable to meet payroll, pension and debt payments without “third-party intervention” or a significant “cost deferral,” according to a new consultant’s report commissioned by the school system and obtained by the Chicago Sun-Times.

The firm Ernst & Young is suggesting the Chicago City Council approve two property-tax increases for the school system. It says the twin increases would be necessary even if CPS makes drastic budget cuts and gets the pension relief and greater state funding it’s seeking in Springfield.

One of the tax hikes it’s recommending would be a “separate levy” of $50 million to bankroll school construction and pay off old projects. CPS has had the authority to impose a “capital improvement tax” for more than 20 years but “never activated” it, according to sources who told the Sun-Times it appears likely Mayor Rahm Emanuel will do so.

The great moments of public education.