Chicago Public Schools Launches FY2027 Budget Process with Preliminary School-Level Budgets

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CHICAGO - Chicago Public Schools (CPS) on Tuesday issued more than 600 preliminary individual school budgets to principals, launching the first phase of the District's FY 2026-27 budget process. Like many school districts across the country, CPS is navigating ongoing financial strains while working to ensure every student has access to a rigorous, equitable, and joyful daily learning experience. The preliminary budgets prioritize classroom instruction, equity-focused funding, and student support services. Providing preliminary budgets allows principals and Local School Councils (LSCs) time to review school-level allocations, gather community input, and submit appeals before the Board of Education votes on the final $10 billion District budget later this summer.

"The District has a responsibility to provide every student with a high-quality education while being responsible stewards of public resources," said Superintendent/CEO Dr. Macquline King. "The preliminary school budgets released today reflect our commitment to protecting the investments that matter most for students while balancing ongoing financial challenges and responsibly planning for the future."

Addressing Financial Challenges While Prioritizing Students

CPS is facing a preliminary deficit of $732.5 million, based on an updated analysis. This figure is based on a Tax Increment Financing (TIF) surplus of $100 million and does not include the cost of reimbursing the City for MEABF. Several factors are driving this gap:

• Federal and state funding has not kept up with students' needs. In fact, CPS is funded at 73% of what the State of Illinois considers adequate.
• CPS is facing higher costs in several key areas, including maintenance for aging facilities, rising labor costs, and the District's longstanding existing debt burden.
• The costs associated with educating the District's highest-need student population continue to grow.

Since 2019, CPS has added more than 9,790 staff positions, with the vast majority working in schools -an investment that supported students' academic, social, and emotional recovery from the pandemic and remote learning. At the same time, leaders must also confront a decline of 45,000 students in enrollment over the same period.

"While these classroom investments drove meaningful academic progress, the expiration of federal ESSER funding, combined with declining enrollment, has made it increasingly difficult to sustain pandemic-era staffing levels and interventions," said Chief Education Officer Dr. Karime Asaf. "Like many public school districts, CPS is now faced with difficult decisions about how to allocate limited resources."

While enrollment has declined, student needs have increased. CPS continues to serve a growing population of students with disabilities, multilingual learners, students in temporary living situations, and others requiring additional academic and social-emotional support.

As part of the FY 2027 budget process, CPS will make targeted adjustments to school-based staffing allocation formulas that account for enrollment changes while continuing to prioritize support for high-need schools.

Last year, the CIty of Chicago declared a record-breaking Tax Increment Financing (TIF) surplus of $1.01 billion in its 2026 fiscal year budget. Because Chicago Public Schools (CPS) receives approximately 52 percent of any TIF surplus by law, the district received more than $550 million.

"We're grateful that our City partners identified a Fiscal Year 2026 TIF surplus to help CPS address significant funding gaps and support the future strength of our city," said Dr. King. "We remain committed to pursuing long-term funding solutions to ensure every student has the resources they need and deserve."

Prioritizing Investments that Directly Support Students

CPS is approaching the FY2027 budget process with a tiered funding priority framework focused on protecting the resources that have the greatest impact on students' daily learning experience.

The District's highest priorities remain direct classroom instruction and student supports, including teachers, counselors, nurses, school clerks and support for students with disabilities, multilingual learners, and students in temporary living situations.

The preliminary FY2027 school budgets include increased investments in several key areas, including:

• Additional special education teachers, classroom assistants, and related service providers (physical therapists, occupational therapists, etc.) to serve a special education population that has increased by nearly 16 percent since 2019.
• Additionally, the District is planning to open dozens of new cluster classrooms to better serve students with disabilities. These investments are intended to ensure students continue to have access to safe, supportive, and academically-enriching learning environments across the District.

Community Engagement and Next Steps

School leaders will work through the staffing and appeals process with the District's Budget Office over the coming weeks to ensure schools are positioned to meet student needs for the 2026-27 school year.

CPS will continue implementing its needs-based budgeting model, introduced in 2024, which ensures schools receive foundational resources while directing additional support to schools serving students with greater academic, social-emotional, and instructional needs.

For the second consecutive year, CPS will also explore significant reductions to central office, network office and citywide expenditures as part of its broader effort to minimize impacts on classrooms and school communities.

While CPS shared the preliminary budgets with principals today, District leaders reminded families and community members that this remains the first phase of the process; there are many unknown decisions that will impact the final proposed Fiscal Year 2027 District budget that will go before the Board. These factors include:

• The final amount of any TIF surplus
• Principal resourcing decisions
• Appeals to these preliminary budgets
• Decisions on central supports
• Feedback gathered through a series of engagement sessions with families, educators, and community partners.

School budgets must be finalized by June 9. Later this summer, CPS will present the full budget for FY27. The fiscal year begins on July 1; the Board of Education must approve the budget by August 29.

"This will be a challenging budget year, but I am confident that we will work with all our partners to make the best decisions on behalf of the more than 315,000 CPS students and their families that we are honored to serve each day," said Dr. King. "Our collaboration and innovation around the budget will ensure our students and city can continue to thrive."