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For the Record: Capital savings from closings in question
On the day CPS announced its list of school closings, students at schools slated to shut down received folders with letters to their parents stating that their school had lost enrollment, was partially empty and needed anywhere from $4 million to $37 million in repairs and maintenance.
District leaders repeated that argument, telling the media that CPS will avoid paying $560 million in capital costs over 10 years by shuttering 51schools—more than the savings in operating expenses. The argument has been used to justify the closings, the largest number ever at one time in a major district, as CPS pointed out the need to move old, expensive-to-maintain buildings off the books and cut a projected $1 billion deficit
But a joint analysis by WBEZ/Chicago Public Media and Catalyst Chicago found that the original cost savings estimates were significantly flawed--based on outdated needs assessments inflated by estimates and riddled with mistakes.
CPS leaders acknowledge that the numbers were not iron-clad and insist that the basic premise—avoiding major capital spending—is solid.
In its draft 10-year facilities plan, officials quietly lowered their initial savings estimate by $122 million, conceding that some of the changes were prompted by repeated questions from WBEZ and Catalyst.
Yet the new projections are still based primarily on speculation regarding the current condition of buildings and its needs.
The WBEZ and Catalyst analysis found these problems with the cost savings figures:
- A CPS official said that the new estimate of $437 million in capital cost savings from closings, down from $560 million, came as the result of updated building assessments. But only six of the 51 schools slated to close have had new assessments.
- CPS officials have added in a variety of expenses to the known needed repairs, such as modernizing labs, compliance with the Americans with Disabilities Act, and installing air conditioning--without conducting assessments to determine what the school needs or obtaining specific estimates of costs.
- Major discrepancies can be found between the public information CPS has provided and the internal accounting of cost savings. The 10-year draft master facilities plan provided estimates for closing schools that are, on average, $3 million higher than estimates in the internal documents provided to Catalyst and WBEZ last week. CPS officials included the cost to upgrade schools, in addition to repair costs, despite plans to close schools.
“We are toast”
Principals, local school council members and community activists--and even aldermen--have been questioning the cost-savings figures since the district first released them.
They believe the numbers were exaggerated to bolster the case for closing schools and say it undermines their trust in the district’s decision-making process—an already fragile trust that CEO Barbara Byrd-Bennett has said she is determined to repair.
One principal said he was worried the minute he saw the district’s estimate for repair and maintenance at his school.
“I thought to myself, we are toast,” said the principal. This principal, and others contacted for this story, said he has been warned by CPS not to talk to the press.
A 2010 assessment put a $7 million price tag on repairs and maintenance at this principal’s school. However, the letter provided by the district for parents said it would cost more than three times that figure for repairs and maintenance.
Parents at Trumbull in Andersonville had a similar reaction. The letter parent Ali Burke received at home on March 21 said that Trumbull needed $16.2 million in maintenance and repairs.
“It is ludicrous,” said Burke, who serves on the local school council at Trumbull.
Trumbull’s latest assessment from 2010 stated that the school needed $4.6 million in capital spending. No new assessment has been done since then. Internal documents provided to WBEZ and Catalyst show CPS lowered the projected savings after the March 21 letter, to about $11 million. The draft facilities plan put the cost to maintain and repair at $15 million.
Burke and other LSC members said they would think CPS would put out estimates based on an actual assessment and pricing based on bids. Burke asked CPS to provide an accounting for how it determined the costs, and CPS officials promised to bring one to a planned meeting with U.S. Rep. Jan Schakowsky. But the CPS official who attended “forgot” the paperwork, Burke said.
James Morgan, Trumbull’s president, is incredulous. “Where is your source, CPS?” he said.
Not a science
Mary Filardo, executive director of the 21st Century School Fund, notes that predicting capital cost savings is difficult. Filado’s Washington D.C.-based organization focuses on educational facilities planning. “It is not science,” she says. “It is elastic.”
But Filardo, who has been assisting the Chicago Educational Facilities Task Force, said that some of the numbers put out by CPS seem odd, especially given the latest assessments.
She points to Wentworth Elementary, a building that is slated to be shut down next year as students and staff relocate to Altgeld.
Between 2000 and 2010, CPS spent about $3 million at Wentworth for boiler repairs and campus renovation, among other work. The 2010 assessment stated that Wentworth needed $5.5 million more in work.
Then, this winter, CPS projected savings of $10.5 million in capital costs by closing Wentworth.
Yet given the major work done in the past 10 years, Filardo says it is hard to imagine what needs to be done. “It is probably an exaggeration,” she says.
Filardo has studied school closings in cities across the country and says it is not unusual for school districts to inflate savings, although often for operating costs such as salaries for laid-off principals, engineers and teachers.
A top CPS official, as well as board president David Vitale, say the adjusting of figures is not important because the basic premise remains.
“Not having to worry about the capital maintenance is clearly something that will save us money,” says the official (whom the CPS communications office would not let be identified). “It is not a perfect science.”
Education quality also a factor
Vitale says CPS officials are trying to put out a lot of information and tackle many projects and so he would not be surprised if some of the information was not accurate.
“My assumption is that they made some judgments and some estimates,” he says. CPS board members have asked to be briefed on each of the proposed school actions. By then, Vitale says he expects the school-by-school numbers to be accurate and it is important to him to be able to compare relative costs between schools.
However, with only six updated assessments, it is hard to see how he will be able to make apples-to-apples comparisons for every closing situation. Take Ryerson and Laura Ward in West Humboldt Park.
The Ward building is slated to close. Ward does not have a new assessment, but the updated assessed need is about $6.6 million a year (including $3.3 million from a 2008 assessment, plus extra costs added in such as inflation, engineering and design).
Ryerson, where Ward’s student and staff are to relocate, has an updated assessment that puts the price tag for capital spending at $7.9 million.
Yet Vitale notes there are other factors to consider beyond capital cost savings.
“Because of our financial situation, we must use our buildings efficiently,” he says. He says he also will be looking at utilization and the quality of education in each building.