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Capital

The FY2024 budget for Chicago Public Schools (CPS) includes a capital budget totaling $155 million of investments that will focus on priority facilities needs and includes leveraging $55 million in outside funding. The FY2024 capital plan provides funding in five main areas: critical facility needs, interior improvements, programmatic investments, site improvements, and IT upgrades.

CPS is committed to promoting equitable access to high-quality school environments. The District's Equity Office played an important role in developing the past few capital proposals and will continue to do so for the FY2024 capital plan to ensure that resources are distributed equitably across CPS schools so all students can share in the District's record-setting progress. In addition, the District conducted five public meetings during the month of April to gather community input during the capital plan development process.

The CPS facility portfolio includes 522 campuses and over 800 buildings. Our average facility is over 83 years old, and the total CPS critical facility need is over $3 billion. Since FY2016, CPS has invested over $3.5 billion into capital improvements 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 FY2024 capital budget is primarily funded by the future issuance of general obligation bonds which are principally repaid by Evidence-Based Funding (EBF). (For more information, please see the Debt Management chapter of the budget book.) A portion of the FY2024 budget is also funded by Tax Increment Financing (TIF) funds, state funding, and other outside resources as they become identified.

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

Sources and Uses

Below is a summary of the sources and uses of the $155 million FY2024 capital budget by funding and project type:

Table 1: Sources and Uses ($ in Millions)
Estimated Sources
Anticipated Bond Offerings and Other Capital Funds1 $100.1
Tax Increment Financing Funding $42.1
External Funding for Space to Grow $10.6
Other Potential External Funding $2.2
Total FY2024 Capital Budget Sources $155.0
Estimated Uses Amount in Millions
Facility Needs and Interior Improvements $103.2
Educational Programming $2.0
IT and Building System Investments $6.2
Site Improvements $23.6
Capital Project Support Services $20.0
Total FY2024 Capital Budget Uses $155.0

District Equity Index to Prioritize Investments

In recent years, the District has prioritized investments promoting equitable access to high-quality learning environments. To advance this work, the District will continue to utilize the Equity Index, a tool to help identify opportunity differences so that resources can be prioritized for the schools in greatest need.

Funding from Tax Increment Financing

CPS has a significant backlog of deferred critical facility needs, so additional funding is always pursued to help mitigate some of this backlog. One of these outside funding sources is the Tax Increment Financing (TIF) funds, which are approved in various categories.

Utilizing the $42.1 million in TIF funding, CPS is planning capital exterior envelope work, mechanical renovations, fire alarm system replacement, modular renovations, interior renovations, and site improvements at 19 campuses.

Priority Facility Needs

Every student deserves to access a neighborhood school that is warm, safe, and dry, and CPS is allocating $103.2 million in funding for critical maintenance projects and interior improvements, which includes $38.2 million in TIF funding for exterior envelope work, mechanical renovations, fire alarm system replacement, modular renovations, and interior improvements.

The FY2024 capital budget addresses the District’s priority renovation projects, and most urgent facility needs that have the leverage of outside funding. We will invest in 3 major exterior envelope projects and four major renovations to mechanical systems. The breakdown of funding for facility needs is as follows:

  • $34.2 million for priority roof, envelope, and mechanical projects;
  • $2.2 million for fire alarm system replacement;
  • $50 million for unanticipated emergency repairs;
  • $5.2 million for building automation system upgrades;
  • $1.6 million for modular refurbishment; and
  • $10 million in interior improvements.

Programmatic Investments to Build Upon School Success

The 2024 capital budget includes $2 million in outside funding to support programmatic investments for high-quality learning environments.

Site Improvements that Foster Learning

This year’s capital budget includes $23.6 million for site improvements, including $3.9 million in TIF funding as well as our continued partnership with the Department of Water Management and the Metropolitan Water Reclamation District. Students can benefit from a well-rounded education that promotes healthy and active development.

IT and Building System Investments

In FY2024, we are proposing a $6.2 million investment in ITS governance, risk, compliance management, private and public cloud upgrades & data storage capacity, and ITS data center network infrastructure upgrades.

Impact of FY2024 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. Below we describe the capital project categories and their potential impact.

Facility Needs

Addressing facility needs helps the District reduce costs associated with frequent repairs to aging roofs, windows, and boiler systems, which are often funded through our general operating budget. This, in turn, frees up operating dollars that can be reallocated for instruction, support, and other district expenses. In addition, replacing roofs and mechanical systems with more energy-efficient solutions can reduce our energy consumption and other utility costs.

Educational Programming, Interior Renovations, and Site Improvements

Investments in educational programming that convert or improve existing space 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 requiring new construction, build-outs, or adding physical space to an existing building, such as a science lab 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 additional operating costs in the short term. Ongoing support for software-based projects will be absorbed by current available staff. Internet connectivity 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 FY2024, regardless of the year the project was appropriated. The Fund Balance (unspent revenues received in prior years) accounts for the difference in expected capital outlays versus revenues received. For example, if the District raised $400 million in bond proceeds during a fiscal year but only expensed $300 million in the same period, the remaining $100 million would carry forward in the Fund Balance for use during the following fiscal year.

Table 2: FY2022 - FY2024 Summary of Capital Projects Funds ($ in Millions)
  FY2022 Actual FY2023 Estimate FY2024 Budget
Beginning-Year Fund Balance $188.8 $163.7 $152.2
Revenues
Local $32.7 $59.5 $82.0
State $13.8 $28.3 $17.1
Federal $10.7 $0.0 $4.0
Interest & Investment Earnings $0.4 $0.0 $0.0
Bond Proceeds $543.5 $450.0 $500.0
Total Revenue $601.1 $537.8 $603.1
Expenditures
Capital Outlay $626.2 $549.3 $500.0
Ending Fund Balance $163.7
$152.2 $255.3

Five-Year Capital Plan

The CPS FY2024 capital budget will follow a different trajectory than in previous years. To ensure that all schools are ready to receive students on day one of the new school year, CPS will seek to pass a scaled-down $155 million capital plan in June of 2023 to address immediate facility needs, including emergency repairs. The FY2024 capital plan provides funding in five main areas: critical facility needs, interior improvements, programmatic investments, site improvements, and IT upgrades.

The District will soon launch a comprehensive review of all facility needs that will include robust stakeholder engagement to develop an Educational Facilities Master Plan. A supplemental FY2024 capital plan with funding identified for priority projects will be released later in the 2023-24 school year once this process is complete.

CPS’ five-year capital plan will include further investments in deferred maintenance, targeted site improvements, and emergency projects. Future projects will be determined by assessed need, district educational priorities, and an equitable distribution of available funding. CPS intends to target approximately $553 million in annual capital funding in fiscal years 2025 through 2028 as part of its five-year capital investment strategy.

Table 3: Five-Year Capital Plan ($ in Millions)
Budget Category FY2025 Budget FY2026 Budget FY2027 Budget FY2028 Budget
Facility Needs $355.0 $355.0 $355.0 $355.0
Interior Improvements $10.0 $10.0 $10.0 $10.0
Programmatic Investments $120.0 $120.0 $120.0 $120.0
IT, Security, and Other Investments $12.0 $12.0 $12.0 $12.0
Site Improvements $30.0 $30.0 $30.0 $30.0
Capital Project Support Services $26.0 $26.0 $26.0 $26.0
Total Capital Plan $553.0 $553.0 $553.0 $553.0

  1. The Board currently expects that the proceeds of bonds will be applied to reimburse itself within 18 months after the later of (a) the date the original expenditure is paid, or (b) the date the project is placed in service, but in no event more than three years after the original expenditure is paid.

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