Chicago Public Schools Borrows $275M to Fulfill Pensions
Chicago Public Schools just sold grant anticipation notes to JPMorgan Chase & Co. that will be repaid with state aid.
CHICAGO — Chicago Public Schools says it has taken out a $275 million short-term loan so it can meet its obligations with the teachers' pension fund by a June 30 deadline.
JPMorgan Chase & Co. on Monday purchased "grant anticipation notes" from CPS, the third-largest school district in the U.S., to be repaid with state education aid.
The district says the $275 million "creates sufficient cash" to pay into the Chicago Teachers' Pension Fund. Another $112 million for district operations will be borrowed separately.
CPS finance chief Ron DeNard says Illinois school districts have suffered because Gov. Bruce Rauner's administration has failed to provide education funding in a timely manner.
In an emailed statement, Rauner's spokeswoman Eleni Demertzis blamed the district's need to borrow on "decades of mismanagement."
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