Vallas Talks Public Schools, Budgeting at IOP Seminar

 On January 14, mayoral candidate Paul Vallas joined journalist Laura Washington in conversation about his vision for Chicago at the Institute of Politics (IOP). The session was the first in an ongoing series of mayoral forums hosted by the Chicago Elections Project, the IOP’s initiative to get students involved in the upcoming 2019 municipal elections.

Drawing from his experience as CEO of Chicago Public Schools from 1995–2001 and former budget director for Chicago, Vallas centered his plan for the city on expanding economic opportunity by balancing the budget and investing in a long-term financial plan.

A History of Public School Service

“I’ve never done anything but public service, and I’ve never done anything but respond to requests for help,” Vallas said, referring to his decades of experience in public service. During his tenure as city budget director for Chicago, Vallas said he balanced four consecutive budgets and “put a record number of police on the street.”

Vallas also served as CEO of both the Philadelphia School District and the Chicago Public Schools (CPS), as well as superintendent of the Recovery School District of Louisiana. He believes that his time managing (CPS) gave him the experience he needs to succeed as mayor of Chicago.

“When I went to the schools I inherited a 1.4 billion dollar structural deficit . . . I left them with a billion dollar cash balance and twelve bond rating upgrades,” Vallas said. Bond ratings allow banks to determine how reliable entities are in paying back debt. A higher bond rating means entities can borrow more money with less interest than an entity with a lower bond rating.

Vallas also claimed that all of the CPS schools that have been opened in the past two decades, with the exception of the last two or three years, were opened under his direction, and that there were seventy thousand more students in CPS under his tenure than there are today.

His claims about transforming CPS are mostly substantiated by Illinois’ non-partisan government watchdog Better Government Association (BGA), though the organization also notes that the transformation can’t entirely be credited to Vallas’s policy. BGA also notes that during Vallas’ six years as CEO of CPS, CPS paid “next to nothing” toward teacher pension costs, contributing to the current deficit in pension funding.

Vallas also implemented prenatal-to-the classroom programs, and matched pregnant teens to parent advocates to “try to get [pregnant teens] back into school.”

“There’s a symmetry between investing in things that are going to help people and the money that you’re going to save long term,” Vallas said. “From a budgetary standpoint, it makes sense.”

A Five Year Budget Balance

According to Vallas, his biggest priority is to solve the pension problem and structurally balance the budget, meaning not only that the budget is balanced but that it “can support financial sustainability for multiple years into the future” by ensuring that recurring sources of revenue can fund ongoing expenditures instead of relying on non-recurring resources like asset sales. To do this, he plans to roll out a long-term plan that budgets in five year cycles which he believes he will reduce spending by 5 percent.

Vallas plans to get the state to fund pensions over the next ten years. He also wants to ensure that if Pritzker decides to raise the income tax, local governments get their fair share according to the local governments’ distribute formula. He intends to stop the illegal corporate personal property replacement tax diversions as well, which he said resulted in corporations stealing about three hundred million dollars from local governments during Bruce Rahner’s time as governor from 2015–2019.

Vallas is also considering garnering additional revenue—especially for police and public safety—by implementing a voluntary payment-in-lieu-of-taxes program for hospitals, universities, and nonprofits, which he believes are “very profitable” and are “gobbling up more and more real-estate, and taking more real-estate out of property tax pay.” Under this program, corporate entities that are exempt from property taxes are asked to contribute money to the city. He cited Boston’s implementation of this program which generates thirty million dollars annually.

“My goal here is to fund pensions, to structurally balance the budget, and to cap tax and fee increases so that your property taxes do not grow more than the rate of inflation or 5 percent, whichever is less, and that we’re not pounding people with fees and fines,” Vallas said.

Vallas believes that his economic plan is connected to the city’s success in other fields. During the forum, a Harris School of Public Policy student asked for Vallas’s “overall vision for Chicago” outside of economic development and balanced books. Vallas responded that while his vision may not lend itself to a sixty-second sound bite, “if you look at everything that [he’d] laid out, it’s all connected to growth, to a healthy community.” He added that “if you don’t have a financial plan, nothing happens.”

Bringing Young Voters On Board

Vallas gave three reasons for why he should appeal to younger voters: his experience, his connection with the community, and the fact that he is “not part of this pay-to-play culture.”

He continually emphasized the fact that his experience is unmatched. “There is no candidate in this race who’s had the experience that I’ve had, and I’m talking about the experience in the city and running institutions with budgets far larger at the time than the city of Chicago,” he said. “And there’s no-one out there who has had more success.”

He credited his time as CEO of CPS with giving him a strong connection to the Chicago community. “Not only did attend one thousand local school council meetings and immerse myself in the community, not only did I hire in such a way so that 75 percent of all my administrators were women and almost 75 percent were black and latino . . . but if students needed anything, I provided it,” he said.

He also created a crisis fund to pay for over 120 funerals of children who had been killed in communities across Chicago. “Knowing violence in the community is going to 120 funerals and sitting in the back until the funeral was over because you did not want to become desensitized.”

He also said that unlike other candidates, he is not part of pay-to-play politics. When he ran against Rod Blagojevich for the 2002 Illinois Gubernatorial Election, he “got outspent 15–1.” And he believes the best way to combat the pay-to-play culture is by implementing term limits to two mayoral and city council terms, as well as rotating committee assignments.

Sharp Criticism for Vallas’ Competitors

Vallas had sharp criticism for his chief competitors. He claimed that candidate Bill Daley, who served as Barack Obama’s Chief of Staff from January 2011 to January 2012, was only “kept around after the second month because they didn’t want to embarrass him.”

When Washington pointed out that candidate Susana Mendoza is currently serving as Comptroller of Illinois, which she said is a “very important budgetary and financial position.” Vallas responded, “Yeah, they sign checks.”

Vallas blamed candidate Garry McCarthy, former superintendent of the Chicago Police Department, for the “total degradation of the police department—not filling vacancies, not hiring detectives, not providing training.”

He also criticized younger candidates like Amara Enyia and John Kozlar for lack of substance. “Having a community development bank isn’t going to do it,” he said, and “they’re not going to hit the 7.5 percent projection earnings that they’re projecting” to fix Chicago’s twenty billion dollar pension unfunded liability.