The search committee that had been looking for a permanent replacement for J. Jerome Harris, fired by the board in July 1990, recommended the action.
Mr. Butts, a 32-year veteran of the system, will earn approximately $125,000.
Michael Casserly, a 15-year veteran at the Council of the Great City Schools, has been named interim executive director of the association. He succeeds Samuel Husk, who retired from the position in December.
A search committee has been formed to choose a permanent successor.