Magazine article Government Finance Review

A $2 Billion Commitment to Education

Magazine article Government Finance Review

A $2 Billion Commitment to Education

Article excerpt

The 430,000-student Chicago Public School District was faced with massive overcrowding and school buildings that were literally falling apart. The Chicago Public Schools (CPS) Capital Improvement Program is making a difference in the lives hundreds of thousands of students who attend one of the 589 public elementary and high schools in Chicago. The Capital Improvement Program (CIP) began in 1996 and is the most aggressive school construction project underway anywhere in the United States. The three major objectives of the CIP are 1) to reduce overcrowding in schools, 2) to improve the physical condition and operating efficiency of school facilities, and 3) to improve the overall quality of the learning environment at each school. The CIP program has a three-pronged approach:

* new construction,

* renovation of buildings, and

* educational enhancements.

The Need

The CPS Capital Improvement Program is a $2 billion program that for three years has been renovating school buildings that were literally falling apart and building new schools to relieve overcrowding. Renovations include fixing or replacing old drafty windows that leak when it rains, replacing or repairing roofs that were in extremely poor condition, and painting and repairing masonry as needed.

The list of repairs was long and seemed endless. Lockers were old, damaged, and needed to be replaced; new indoor and outdoor lighting was necessary; and some swimming pools had been closed for years.

Many schools were experiencing extreme and unacceptable levels of overcrowding. Classes were being held in hallways and in auditoriums. The situation that was uncovered by the CIP needs assessment probe uncovered conditions that were the result of years of neglect and insufficient or incomplete repairs.

In 1995, the Chicago mayor appointed the Chicago School Reform Board of Trustees consisting of a president and four trustees. The new board would provide the vision and policy for CPS and breathe life into a capital program to help change the learning environment of the students. The trustees conducted a needs assessment and immediately recognized the poor conditions of the schools and the unacceptable levels of overcrowding. This dangerous combination was the impetus for them to push for a massive CIP plan.

The Solution

All CPS schools were assessed to determine their renovation needs and to ascertain the level of severity. The inadequacies were overwhelming and were far greater than what anyone had anticipated. At the beginning of the capital program, CPS management identified about $806 million in projects for which CPS expected to generate the funds in the private bond market. Management originally believed it would be difficult for CPS to raise the additional capital beyond this level and that the original $806 million would be spent over a five-year period. Projects funded by this bond issue were identified as Phase I of the Capital Improvement Program.

Since that time, however, more needs surfaced and CPS was forced to more than double the scope of its efforts with the help and support from both the mayor's office and the Chicago City Council. Through aggressive financial management resulting in numerous credit upgrades from financial rating agencies, management was able to increase the CIP funding level and dramatically increase the number of schools slotted to receive major construction renovations and new construction projects.

By early 1997, CPS anticipated increasing total CIP spending to $1.4 billion by 2002, and an additional $600 million in projects were identified in March of 1997. These projects were classified as Phase II projects. However, because of the growing scope of the CIP and the realization that it is likely to be an ongoing effort for many years to come, CPS has elected to adopt an ongoing five-year CIP strategy with projects targeted for fiscal years rather than phases. …

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