The state of Illinois will distribute $87.5 million to hundreds of school districts that were underpaid because of a “coding error” —while seeking repayment from Chicago Public Schools, which mistakenly got the funds.
The appropriation is part of the $46.5 billion spending plan lawmakers passed Saturday. The Illinois State Board of Education said a contractor made a “coding error” in the spring of 2018 during the initial implementation of a new state school funding formula.
As a result, 14 school systems are owed between $1 million and $5 million, while 565 are due up to $100,000 according to IBSE. In total, 762 school districts were underpaid over the past four years.
Meanwhile, the state is trying to recoup the $87 million it mistakenly paid CPS, its largest school district. ISBE said 52 other school systems were overpaid by a total of $3,396 during the affected period, and it will try to recover funds from districts that received at least $10 more than they should have.
“The error represents less than half a percentage point of the total funding that has been allocated statewide” through Illinois’ funding formula during that time, State Superintendent of Education Carmen Ayala said in a letter Wednesday. “All affected organizational units will soon receive a letter from ISBE notifying them about how much they are owed by the state.”
In her letter, Ayala said ISBE is “in communication with CPS about an extended repayment period, so that classrooms are not impacted.” CPS is in the middle of formulating its overall budget for the upcoming school year; this year’s was $9.3 billion.
A CPS spokesperson said Friday in a statement the district is “in discussions with ISBE and the General Assembly about the impacts on CPS and the state budget.”
ISBE spokeswoman Jackie Matthews said the coding error overstated the enrollment of students attending state-authorized charter schools in districts with more than one of these schools. The mistake only affected the CPS enrollment data since no other districts have multiple state-authorized charter schools, according to ISBE. The problem continued for years because the state’s formula takes into account the prior year’s calculations.
There are about 58,000 CPS students enrolled in more than 100 charter schools. CPS counts 330,000 students districtwide.
Matthews said ISBE identified the discrepancy while preparing a report requested in December by a panel tasked with reviewing the implementation of the state funding formula, which was signed into law by former Gov. Bruce Rauner in 2017.
Ayala said ISBE put “additional protocols in place to ensure accuracy moving forward” and initiated the process to pursue an external audit of the formula, which is supposed to give priority to districts with poor property wealth.
The formula miscalculation was raised Wednesday at an Illinois House Executive Committee hearing.
“I heard about it one day last week and was like, ‘What the heck is this?’” said House Majority Leader Greg Harris, a Chicago Democrat and lead budget negotiator.
Rep. Avery Bourne, R-Morrisonville, wanted to know how CPS would return the money and how the error would affect the funding formula in the future.
Harris said “this is a big complicated question for which there are some big complicated answers that ... we’re gonna have to work through to figure out.”
Bourne suggested addressing the issue in an education appropriations committee.
“I think this has major implications that warrant a longer discussion, and I know this probably isn’t the appropriate venue, but I think this could be a big issue—now and down the road,” she said.
During debate over the budget on the House floor early Saturday, Harris noted that the miscalculation occurred on Rauner’s watch.
“I just wish when the Rauner administration made this error they had corrected it so we would not find ourselves in this position today,” he said.
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