What is the status of the $800 million line of credit?
First, it’s important to understand what a line of credit actually is. A line of credit is an opportunity to borrow funds that must be paid back from local tax revenues. It is not new or incremental revenue for the district. On June 15, 2010 the Board of Education authorized a line of credit to cover temporary cash flow fluctuations in FY 2011, such as delayed payments from the State of Illinois. Since then, CPS has solicited bids from financial institutions. CPS is in the process of finalizing the line of credit with several banks and negotiating the terms of the transactions, including the interest CPS will pay and the total amount of the line (which will not exceed what the Board authorized). CPS will negotiate the best possible interest rates and lowest fees. CPS expects the line of credit to be in place and ready for draw in September. Some have suggested CPS use this line of credit to close our budget deficit. This is not a legally or fiscally viable option. We may only draw on t
