CPS promoting 1% tax hike for schools

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Chicago Public Schools officials are floating plans for a one-point increase in the state’s 3 percent flat-rate personal income tax, and a slightly higher increase for the corporate income tax.

The hike would generate an estimated $4.1 billion in new money for schools and statewide infrastructure projects. About half of the money would help school districts cover ever increasing operating costs—CPS would likely get about a 20 percent of this portion of the money—and the other half would go toward new school construction and other infrastructure projects like roads and mass transit.

Chicago Public Schools officials are floating plans for a one-point increase in the state’s 3 percent flat-rate personal income tax, and a slightly higher increase for the corporate income tax.

The hike would generate an estimated $4.1 billion in new money for schools and statewide infrastructure projects. About half of the money would help school districts cover ever increasing operating costs—CPS would likely get about a 20 percent of this portion of the money—and the other half would go toward new school construction and other infrastructure projects like roads and mass transit.

Peter Cunningham, a high-level CPS consultant, characterizes the effort as an ongoing conversation—rather than a lobbying effort around a specific proposal—between school officials, lawmakers, business leaders and community groups. He says the district is working closely with LUDA (Large Urban Districts Association) superintendents and various groups associated with the A+ Illinois campaign to reform education funding.

“This particular idea might be a more palatable one,” Cunningham says, noting legislators’ reluctance to call SB 2288 and HB 750 for a vote, proposals that called for bigger tax hikes. “Maybe a more modest income tax makes sense. Let’s focus on education and capital first.”

State Sen. James Meeks has led the charge on earlier funding reform proposals calling for property tax relief in exchange for a 2 percentage point hike in the income tax aimed at schools. But Cunningham says a 2-point hike may pose too big of a political roadblock, and a tax swap to relieve property taxes may not be absolutely necessary. The extra money generated through a 1 point increase, he suggests, may allow local taxing bodies to cap property taxes moving forward.

“One percent may not get you enough, but a much bigger tax increase may not pass,” he says.

Still unclear is whether strings would be attached to how districts spend the extra funds. On table for discussion: early childhood programs, special education, raising charter school cap, higher learning standards and income tax relief for poor families.