Chicago Public Schools Gets Credit Downgrade


The bad news continues to come for the Chicago Public School System, who recently saw their credit rating with Moody’s and Fitch, two of the largest credit rating agencies, downgraded.

The city was downgraded from Ba1 to Ba3 by Moody’s, and Fitch Ratings gave the city a rating of BBB+.  The move will cause the city and district to go into sub-investment-grade status.  The city is now being compared to Detroit, which went bankrupt in 2013.

With the budget gap now faced by the district, Illinois Governor Bruce Rauner agrees the declaring bankruptcy may be the best option, reports Abby Jackson for Business Insider.

“This investigation is very sad, I hope there’s been no wrong-doing, but Chicago Public Schools has been a source of patronage, cronyism, dealings, massive bureaucracy,” Illinois Gov. Bruce Rauner said to CBS Chicago last month.  “It hasn’t really served the families and the parents of the children in a very long time,” he added.

The news comes as the district is facing a federal discrimination lawsuit concerning alleged pregnancy discrimination which saw eight pregnant teachers in the district claim they were targeted for layoff in addition to receiving poor performance reviews.  The teachers are asking for monetary compensation and new policies that would prevent any future discrimination.

“The most difficult factor in this particular case is that the CPS does not have clearly written policies in existence that deal with sexual harassment or discrimination and seemingly does not address what is considered to be prejudicial treatment,” says Chicago employment attorney Timothy Coffey.

It was recently discovered that the school gave up the real personal information of 4,000 students to five vendors that were looking to do business with the district.  Students’ home addresses, names, phone numbers and disability status’ were all leaked to the vendors, who were simply checking how their software solutions would fair.  The issue could have been avoided by supplying the vendors with a random list of addresses, or having certain information withheld.

As soon as CPS noticed the mistake, steps were immediately taken to ask the vendors to shred the documents.

“CPS takes student privacy very seriously and we deeply regret these circumstances,” officials said in a statement to the news website. “To prevent future unauthorized disclosures, the District is training staff members on student information safeguards and the importance of maintaining student privacy,” officials added.

The district is also considering allowing charter schools to take over schools that have closed down, despite a promise by CPS CEO Barbara Byrd-Bennett to not let that happen.  Byrd-Bennett has repeatedly argued against the move, saying the schools had too few students to warrant keeping them open, adding that it would be a waste of the district’s resources to support that many school buildings.