Capital 2020

The FY2020 budget for Chicago Public Schools (CPS) includes a capital budget totaling $821 million of investments that will focus on priority facilities needs at neighborhood schools; the district’s largest-ever Pre-K capital investment; ADA accessibility; and continued expansion of technology upgrades, modern science labs, and other academic priorities. To support schools throughout the city, the FY2020 capital plan provides funding in five main areas: critical facility needs, interior improvements, educational programs, site improvements, and IT and security upgrades.

CPS is committed to promoting equitable access to high-quality school environments, and equity served as the foundation for the FY2020 capital plan. The district's new Equity Office played an important role in developing the FY2020 capital proposal by helping to ensure that resources are distributed fairly and equitably across CPS schools so that all students can share in the district's record-setting progress. As a result of the district’s focus on equity, 93 percent of the guaranteed $619 million capital plan will support schools that serve majority low-income student populations.

As of August 2019, there are roughly 325 active projects across the district. These projects include major renovations to ensure our schools stay warm and dry, facility construction to relieve overcrowding, security cameras to provide a safer environment for our children, and renovations to aid programmatic enhancements, among others.

The FY2020 capital budget is funded by future bond proceeds backed by the Capital Improvement Tax (CIT) and Evidence Based Funding (EBF), potential state capital funding, federal E-Rate revenue, and potential outside resources as they become identified.

Full details on the FY2020 capital budget are available on the interactive capital plan website: www.cps.edu/capitalplan. The site allows users to quickly select projects by school, geographic area, type, and year.

CPS’ five-year capital plan aligns with the priorities outlined in the draft Educational Facilities Master Plan. Future projects will be determined by assessed need, district educational priorities, and available funding.

Sources and Uses

Below is a summary of the sources and uses of the $821 million FY2020 capital budget by funding and project type:

Funding from the State

Thanks to the support and advocacy of the dedicated elected officials in Springfield, the $821 million capital budget includes $191 million in state funding that was approved this spring as part of a $45 billion state capital bill. This plan, named the Rebuild Illinois Capital Investment Plan, is directed at enhancing the state's roads, bridges, and public transit systems as well as significant improvements to K-12 school facilities. Because these funds have not yet been appropriated by the state and are part of a six-year state plan, the district is capturing the full $191 million in this year’s budget so we are able to utilize any appropriations that may be made by the state this year. These funds will not be allocated to specific projects until funding is provided by the state.

Priority Facility Needs at Neighborhood Schools

Every student deserves to access a neighborhood school that is warm, safe and dry, and CPS is allocating $263 million in funding for critical maintenance projects and interior improvements. In previous years, we have invested in facilities needs along with significant new construction projects that benefited a smaller number of families. As part of our commitment to equity, the district is prioritizing renovations at neighborhood schools throughout the city to ensure all students can learn and grow in school buildings that support high-quality learning environments.

The FY2020 capital budget addresses the district’s priority renovation projects and most urgent facility needs. This funding will address over 19 roof and envelope projects and over six renovations to mechanical systems. Along with these projects, the funding will provide:

• $50 million for unanticipated emergency repairs,
• $15 million for district maintenance priorities,
• $10.5 million for ADA accessibility,
• $10 million for masonry remediation,
• $7.5 million for fire alarm system replacement,
• $5 million for chimney stabilization, and
• $2 million for critical temperature control system replacement.

Expansion of Free, Full Day Pre-K

CPS is making its largest ever Pre-Kindergarten capital investment as part of its plan to provide free full-day Pre-K to all 4-year-olds in Chicago by 2021. As part of a $120 million combined investment in Pre-K facilities, $20 million is being allocated for classroom conversions to be completed in time for the 2019-20 school year, and $100 million is being allocated for classroom expansion at schools throughout the city to support additional Pre-K seats that will open in fall 2020.

Support for Students With Physical Limitations

We will invest $10.5 million to increase ADA accessibility as part of a multi-year program to ensure all CPS buildings have first-floor accessibility. While any major capital project contains significant ADA upgrades, for the first time in more than a decade, CPS will set aside funds separate from existing capital upgrades or new construction to begin addressing this critically important need.

Programmatic and Technology Investments to Build Upon School Success

The FY2020 budget prioritizes high-quality educational programming in neighborhoods throughout the city. CPS is investing $145 million in building modernization to ensure all schools are able to support 21st Century learning environments, including:

• $30 million to launch the second phase of our high school science lab modernization project to add, upgrade, or renovate science labs in 29 high schools.
• $30 million in capital upgrades to align with academic program needs.
• $85 million to provide devices and infrastructure modernization at over 130 schools.

Site Improvements that Foster Learning

The proposed capital budget includes an additional $45 million in site improvements to design and build new playgrounds, play lots, and turf fields at over 20 schools across the city so that students can benefit from a well-rounded education that promotes healthy development.

IT and Security Infrastructure

In FY2020, CPS is also allocating $60 million to improve internet connectivity by building and repairing network infrastructure across the district. $50 million of this investment is supported by federal E-Rate revenue, and the district will cover the remaining $10 million.

Finally, to support student safety at every school, $2 million will fund new security equipment including cameras, intercom phones, alarms, and screening equipment.

IMPACT of FY2020 Capital Projects on Operating Budget

All projects considered for inclusion in the annual capital budget are analyzed for their projected impact on the district’s operating budget.

Facility Needs

Addressing facility needs not only helps the district reduce costs associated with temporary fixes, which have been increasing significantly over time, but it also helps reduce debt service payments associated with borrowing for the temporary fix projects. This in turn frees up operating dollars that can be re-allocated for instruction, supports, and other district expenses.

In addition, by replacing roofs and mechanical systems with more energy efficient solutions, we will reduce our energy consumption utility costs.

Educational Programming, Interior Renovations, and Site Improvements

Investments in educational programming that convert or improve existing space (e.g., new science labs, converted classrooms, upgrades for STEM) will have no appreciable impact on the operating budget because the district already accounts for the cost of maintaining these spaces. Investments in classroom technology will add operating expenses related to support and maintenance of the software and devices.

Investments that require build-outs and add physical space to an existing building, such as an addition for new Pre-K classrooms or a new turf field, will add operating expenses for utilities, custodial services, engineering, and security.

IT and Security Infrastructure

Infrastructure, hardware, or software implementation projects will not trigger any additional operating costs in the short term. Ongoing support for software-based projects will be absorbed by current available staff. WAN infrastructure projects and new security equipment will potentially add additional costs to the operating budget for maintenance and repair as time goes on; however, we expect these costs to be limited as we fit the new equipment into our current maintenance and repair allocations.

Capital Project Support Services

This allocation of funds helps to support the management of the capital budget which includes reconciling invoices; managing project and construction timelines; and ensuring the effective design, implementation, and construction of various capital projects. These services are necessary to manage a complex capital program, conduct cost estimations, meet financial and management objectives, and plan for the next phase of the district’s capital plan.

Capital Projects Fund Activity

The Summary of Capital Projects Funds table (Table 2) shows capital revenues and capital outlays (expenses) to be incurred in FY2020 regardless of the year the project was appropriated. The Fund Balance (unspent revenues received in prior years) accounts for the difference in expected FY2019 capital outlay versus revenue. For example, if the district raised $400 million in bond proceeds during a fiscal year but only expensed $300 million in the same time period, the remaining $100 million would carry forward in the Fund Balance for use during the following fiscal year.

FY2020 Local revenue of $34.6 million includes $13 million in Tax Increment Financing (TIF)-related project reimbursements and $21.6 million from other local funding sources such as aldermanic funds and the water reclamation district.

The state revenue total of $32.4 million is comprised of $13.3 million in gaming revenue for new construction projects, $0.8 million from Illinois Green Infrastructure Grants, $0.3 million funded through state environmental fines, and $18 million in other potential state grants.

The federal revenue total is an expected $10.1 million in federal E-Rate funding for upgrades to the district’s IT infrastructure.

Table 3 outlines capital funds spent each fiscal year, by the year in which the funds were appropriated. For a more detailed view into FY19 spending, CPS will publish a report by September 30, 2019, that offers a breakdown of funds by project, source, and other categories.

A=Actual E = Estimated