CHICAGO – Chicago Public Schools treasurer David Bryant is among several members of the system’s Treasury Department who were claimed by layoffs announced this week to help trim labor costs.
The district is struggling with a $370 million budget deficit and state payment delays totaling $350 million. Bryant has been with the district more than a decade and has worked under a series of chief financial officers in the post, which manages the Chicago Board of Education’s debt issuance.
The district was launched in the mid-1990s after Illinois lawmakers gave control of the schools back to Mayor Richard Daley. It has undertaken a $5 billion capital campaign, mostly bond-financed, to rehabilitate existing schools, build new ones, and upgrade technology.
“The treasurer’s layoff is a reflection of the deep and painful cuts to central office that this administration has had to make in light of our difficult financial position,” said CPS chief financial officer Diana Ferguson, who took the reins of the district’s finances earlier this year. “CPS has chosen to use any additional state dollars to maintain class size.”
Ferguson praised Bryant, saying that CPS is grateful for his contributions and wishes him the best in his future endeavors.
District chief executive officer Ron Huberman earlier this week said the district was able to avert some teacher layoffs that would have driven up elementary class sizes due in part to the restoration of $57 million in state categorical funding aid. The Illinois State Board of Education and Gov. Pat Quinn restored the funding last week, lowering the district’s projected fiscal 2011 deficit to $370 million from $427 million.
Huberman warned that some program and staff cuts would still be needed and high school class sizes might still rise. Facing its own cash crunch, the state is $350 million behind on aid payments to CPS.
To fully avert teacher layoffs, the district is calling on the Chicago Teachers Union to forgo salary hikes. The Board of Education authorized establishment of an $800 million line of credit to boost its liquidity during an emergency meeting in June. It also approved other measures giving Huberman extraordinary powers to manage the district through its budget crisis.
Bryant’s departure comes less than a month after Ferguson hired former Fitch Ratings Midwest analyst Melanie Jopek Shaker to fill a new position as her deputy.
Treasury Department staff now report to Shaker, who will also serve as acting treasurer. Some local market participants believed Bryant’s time was limited after Shaker’s hiring as Huberman is under pressure to reduce the number of administrators.
However, Ferguson denied Bryant’s layoff was tied to Shaker’s hiring.
“The hiring of a deputy chief financial officer is in no way connected to the layoffs in Treasury and other departments in central office,” she said. “The deputy CFO’s role and tasks extend well beyond the Treasury Department.”
CPS’ efforts to keep its long-term $5 billion capital program on track will be aided by Chicago’s issuance of $175 million of general obligation bonds this summer under the $1 billion Modern Schools Across Chicago program, which leverages tax-increment financing revenue. The district also is planning a new-money sale that has not yet been sized for later this year.
The district’s $4.3 billion of outstanding debt is rated AA-minus by Fitch, Aa2 by Moody’s Investors Service, and AA-minus by Standard & Poor’s. The outlook on all the ratings is stable.