Comprehensive Annual Financial Report
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Chicago Public Schools Comprehensive Annual Financial Report Department of Finance FOR THE FISCAL YEAR ENDED JUNE 30, 2020 Lori E. Lightfoot Mayor City of Chicago, Illinois Chicago Board of Education Miguel del Valle Board President Chicago Public Schools Janice K. Jackson, EdD Chief Executive Officer CHICAGO PUBLIC SCHOOLS Chicago Board of Education Chicago, Illinois COMPREHENSIVE ANNUAL FINANCIAL REPORT For the year ended June 30, 2020 Prepared by the Department of Finance Lori Lightfoot, Mayor, City of Chicago Miguel del Valle, Board President Janice K. Jackson, EdD, Chief Executive Officer Board of Education City of Chicago Miguel de! Valle Office of the Board Sendhil Revuluri PRESIDENT I North Dearborn Street, Suite 950, Chicago, Illinois 60602 VICE PRESIDENT (773) 553-1600 Fax (773) 553-3453 MEMBERS Luisiana Melendez Amy Rome Lucino Sotelo Elizabeth Todd-Breland Dwayne Truss Dear Friends and Colleagues, It is our privilege to present you with the Chicago Public Schools (CPS) Fiscal Year 2020 (FY20) financial results, which demonstrate the district's continued commitment to financial stability. In FY20, CPS faced significant challenges due to the onset of COVID-19 and its subsequent effect on the global economy. Despite these circumstances, however, the district's strong financial controls resulted in general operating revenues slightly exceeding expenditures during FY20. While the global pandemic presented many challenges, we remained committed to our Five-Year Vision goals, investing $583 million to modernize classrooms, renovate science labs, build new pre-k classrooms, and improve ADA accessibility in our schools. With little notice or preparation, CPS pivoted to a new model of education delivery in March, as teachers, students and families all learned about remote learning together. This unexpected challenge stretched the ingenuity of our teachers and administrators, and the determination of our students and families. Fighting through this adversity, CPS' one year dropout rate is lower than ever before at 5.6% and the five year graduation rate is at an all-time high of 82.5%. While we continue managing new and evolving issues created by the pandemic, CPS remains fully committed to investing in the learning environments that students need to thrive. Our Fiscal Year 2021 (FY21) operating budget included $6.92 billion in funding, with 95 percent of these funds directly supporting schools. Expected increased revenue of $631 million in FY21 will keep CPS on track for sustainable growth. In FY21, we expect to spend $758 million on capital projects, moving the district closer to our goal of providing every child from every community in Chicago with equitable access to high quality school environments. We remain committed to working with the Chicago Board of Education and the Honorable Mayor Lori E. Lightfoot to continue our district's historic progress. Our focus moving forward will be on maintaining the district's financial stability and on improving the equity and transparency that is needed for every child from every community in Chicago to receive the education they need for success in college, career, and civic life. Respectfully submitted, Miguel del Valle President l.=ff:::-Chief Executive Officer Chicago Board of Education Chicago Public Schools CHICAGO PUBLIC SCHOOLS Chicago Board of Education 2020 COMPREHENSIVE ANNUAL FINANCIAL REPORT CONTENTS Page I. INTRODUCTORY SECTION Board Officials ............................................................................................................................................. 2 GFOA Award. .............................................................................................................................................. 3 ASBO Award. .............................................................................................................................................. 4 Organizational Chart. .................................................................................................................................. 5 Board Member Profiles ............................................................................................................................... 6 Letter of Transmittal. ................................................................................................................................. 12 II. FINANCIAL SECTION Independent Auditors’ Report ............................................................................................................ 23 Management’s Discussion and Analysis ............................................................................................. 27 Basic Financial Statements Statement of Net Position ..................................................................................................................... 46 Statement of Activities ........................................................................................................................... 48 Balance Sheet — Governmental Funds ............................................................................................... 49 Reconciliation of the Balance Sheet — Governmental Funds to the Statement of Net Position ........................................................................................................................................... 50 Statement of Revenues, Expenditures and Net Changes in Fund Balances — Governmental Funds ................................................................................................................................................. 51 Reconciliation of the Statement of Revenues, Expenditures and Net Changes in Fund Balances — Governmental Funds to the Statement of Activities .................................................... 52 Notes to Basic Financial Statements .................................................................................................... 53 Required Supplementary Information Statement of Revenues, Expenditures by Object — Other Financing Sources and Net Changes in Fund Balance — Final Appropriations vs. Actual — General Operating Fund ……..100 Schedule of CPS’ Proportionate Share of Net Pension Liability ...................................................... 101 Schedule of CPS’ Contributions to Defined Benefit Pension Plans……………………………………102 Schedule of CPS’ Proportionate Share of Total Other Postemployment Liability and Schedule of Other Post-Employment Benefits Contributions ...........................................................103 Individual Fund Schedules General Operating Fund Schedule of Revenues, Expenditures and Net Changes in Fund Balance — Final Appropriations and Actual ............................................................................................................ 105 Capital Projects Fund Schedule of Revenues, Expenditures, Other Financing Sources and Net Changes in Fund Balances ...................................................................................................................................... 108 Capital Asset Program Schedule of Revenues and Expenditures and Net Change in Fund Balance — Final Appropriations vs. Actual ......................................................................................................... 109 Comprehensive Annual Financial Report i Page Capital Improvement Program Schedule of Revenues, Expenditures by Object, Other Financing Sources (Uses) and Net Change in Fund Balance — Final Appropriations vs. Actual…………………………………….......110 Debt Service Fund Schedule of Revenues, Expenditures, Other Financing Sources (Uses) and Net Changes in Fund Balances ............................................................................................................................. 112 Bond Redemption and Interest Program Schedule of Revenues, Expenditures by Object, Other Financing Sources (Uses) and Net Changes in Fund Balance — Final Appropriations vs. Actual ......................................... 113 Public Building Commission Leases Program Schedule of Revenues, Expenditures by Object, Other Financing Sources (Uses) and Net Changes in Fund Balance — Final Appropriations vs. Actual ......................................... 114 III. STATISTICAL SECTION (Unaudited) Financial Trends Components of Net Position — Last Ten Fiscal Years ..................................................................... 118 Changes in Net Position — Last Ten Fiscal Years ............................................................................ 120 Components of Fund Balance — Last Ten Fiscal Years ................................................................... 122 Changes in Fund Balances of Governmental Funds — Last Ten Fiscal Years ................................ 124 Revenues by Source — All Programs — Last Ten Fiscal Years ..................................................... 126 Expenditures by Function — All Programs — Last Ten Fiscal Years ............................................... 128 General Operating Fund — Detailed Schedule of Revenue and Expenditures ................................ 130 Other Financing Sources and (Uses) — Last Ten Fiscal Years ....................................................... 136 Ratio of Debt Service to Non-Capital Expenditures — Last Ten Fiscal Years ................................. 138 Revenue Capacity Direct and Overlapping Property Tax Rates — Last Ten Fiscal Years ............................................. 140 Property Tax Levies and Collections — Last Ten Fiscal Years ......................................................