Take 5: Asbestos in schools, property tax trigger, state financial watch list

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File photo for CPS CEO Forrest Claypool at his first Chicago Public Schools board meeting in July 2015.

Photo by Max Herman

File photo for CPS CEO Forrest Claypool at his first Chicago Public Schools board meeting in July 2015.

An environmental group has found widespread asbestos risks in classrooms, hallways and teachers’ lounges across Chicago Public Schools.

The Washington D.C.-based Environmental Working Group analyzed district records from 2013 and found 184 schools with asbestos that could easily be crumbled, which poses a health risk if inhaled or swallowed. By late 2015, the district had complied with recommendations to repair or remove the asbestos in just 11 of those schools, according to an Environmental Working Group report released Thursday.

In an interview with WBEZ, Sarah Grantham, policy analyst for the advocacy organization, said it was “shocking” that the district hadn’t fixed all the problems but acknowledged that asbestos cleanup is costly, and the federal government provides no help.

A district spokeswoman told WBEZ that CPS has spent more than $54 million addressing environmental concerns, but she did not specify how much of that was on asbestos cleanup. She also said that the district has a $3.2 billion backlog of deferred maintenance.

Asbestos exposure can cause cancer, researchers have found, and some studies have shown that elementary school teachers are twice as likely to die from mesothelioma, a form of cancer directly linked to asbestos.

2. Property owners on the hook?  The Chicago Tribune reports on a little-known provision in the district’s bond documents that would trigger a property tax increase if CPS fails to pay its investors.

State law limits the district’s ability to raise property taxes for operating revenues, but the tax cap does not apply to taxes collected for debt service. “It is a method that allows taxpayers to be on the hook for bonds they did not approve in a referendum,” Richard Ciccarone of Merritt Research Services told the Tribune.

Some analysts say the district’s financial crisis increases the chances for an automatic increase. In fact, during a January presentation to prospective investors, CPS Treasurer Jennie Huang Bennett explained that if the school district were unable to make a debt payment, “the taxes are then extended and collected for the benefit of bondholders,” according to the Tribune.

Last month CPS had to borrow money at an exceedingly high 8.5-percent interest rate in order to make a $474 million debt payment on its $6 billion debt load. The Tribune points out that its next debt payment of about $540 million isn’t due until next February — but “a lot could happen before then given the precariousness of the district’s finances.”

Meanwhile, the district is on track to finish its fiscal year in June with only $118 million in its general operating fund — 2 percent of its annual budget.

3. State watch list… In a related development, CPS has once again made the state’s financial watch list, this time with an even lower score than last year. The rating is based on last school year’s data and takes into consideration fund balances, borrowing ability and cash on hand.

Districts that fall into this category — there were 31 others across the state, mostly downstate or in the collar counties — are monitored closely and may be required to submit a financial plan to the state. The Illinois State Board of Education says it “has the ability to implement a Financial Oversight Panel” if a district fails to follow its plan, though CPS believes state law exempts it from this oversight.

In February, ISBE launched investigations into six school districts that landed on last year’s watch list, including CPS and five tiny districts in Streator, South Wilmington, Edwardsville, Johnsbury and New Lenox. In a statement, State Superintendent Tony Smith said ISBE hoped the investigations would identify opportunities for steps that will improve financial conditions” at the districts.

The state’s financial data review also showed that about 59 percent of districts are expected to run a deficit this year, up from 57 percent last year. Smith pointed to this fact as he urged legislators on Wednesday to approve a budget for the coming school year that meets the so-called “foundation level of funding,” which is $6,119 per student. The state hasn’t met that obligation in four years.

4. Weighted charter lotteries … Across the country, more school districts and advocates are considering using weighted lottery practices to boost diversity at charter schools, which have long been criticized for educating fewer high-needs students than traditional public schools.  Education Week reports that the new algorithms would favor certain types of students, such as those from low-income families or working to master English.

“Affluent people want diversity and low-income people want diversity, so we have to figure this out,” says Christie Huck, who runs a St. Louis charter school that’s tried accepting only students from select neighborhoods in order to keep a balanced mix of students.

While a handful of charters already use similar practices, others are cautious because many state charter laws don’t explicitly say hat policies for shaping school demographics are allowed. Last year, the National Alliance for Public Charter Schools found that no state prevents the use of weighted lotteries for diversity purposes, but more than 20 have laws that are vague or don’t mention the topic.

Although work has been done at the national level to make it simpler for schools and networks to use weighted lotteries, some say these methods won’t completely correct the problem.

5. Ed tech pricing … A new consortium of school districts funded by the Gates Foundation is trying to prevent price gouging by ed tech companies. The head of the new Technology for Education Consortium — which was unveiled during the South by Southwest conference this week —  says the lack of price transparency makes it difficult for school districts to negotiate with vendors,  according to the Hechinger Report. For example, school districts have paid prices that range from $367 to $499 for identical Apple iPads.

The new nonprofit will provide free pricing reports and procurement advice to districts.  Beyond Apple, the group plans to research price gouging for popular Chromebook devices and, eventually, education technology software.The group also wants to help districts identify “high-quality education technology.”

On that note, our upcoming issue of Catalyst In Depth will take a comprehensive look  at learning software used in Chicago schools and the business of education technology in Chicago. Email Kalyn Belsha at kbelsha@catalyst-chicago.org to share your experiences with ed tech.

One last note… The Sun-Times reports that Thomas Vranas, one of the indicted co-owners of the SUPES Academy, is set to plead guilty at a hearing next month in the federal corruption case that fell CPS CEO Barbara Byrd-Bennett. Meanwhile Gary Solomon, the other co-owner, remains in plea-related discussions with prosecutors.