July 14, 2017 / 8:22 PM / in 12 days

Illinois governor says schools will open despite funding fight

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FILE PHOTO: Illinois Gov-elect Bruce Rauner speaks to the media after a meeting with U.S. President Barack Obama and other Governor-elects from seven U.S. states at the White House in Washington December 5, 2014.Larry Downing/File Photo

CHICAGO (Reuters) - Illinois Governor Bruce Rauner said on Friday that the state's 855 public school districts will open next month despite a disagreement over legislation that could lead to a halt in state education funding.

"We're going to make sure schools get open," the Republican governor told reporters as he reiterated his opposition to a bill passed by the Democratic-controlled legislature in May that he called "fundamentally unfair" to schools and taxpayers.

The bill establishes an evidence-based model that ties public school funding to "best practices" aimed at enhancing student achievement. It also allocates about $300 million more to the Chicago Public Schools (CPS) for state aid and pensions.

Meanwhile, the $36 billion fiscal 2018 budget the Illinois General Assembly enacted last week over Rauner's veto prohibits the flow of state money to schools in the absence of an evidence-based funding model, raising concerns over whether the state will make a looming August payment to the school districts.

The governor, a long-time critic of the financially struggling CPS, said the bill benefits "one school district" at the expense of others.

"We need to get a fair school funding formula that's fair to everyone," Rauner said, adding that the bill has not yet been sent to him by the legislature.

Votes in both the House and Senate for the measure's passage in May fell short of the three-fifths threshold required to override a veto.

Moody's Investors Service said on Friday that a delay in the first fiscal 2018 state payment due schools in August would pressure districts, including junk-rated CPS, forcing some to tap reserves or borrow for operations.

"School districts with relatively low property tax wealth or high poverty face the greatest risk from a disruption in state funding because of their material dependence on state aid," Moody's said in a report.

In fiscal 2016, some 119 school districts relied on state money for 50 percent to as much as 71.5 percent of their budgets, according to Illinois State Board of Education data.

An Illinois Association of School Boards official has said that about a dozen districts may not be able to start classes next month if state funding is delayed.

Reporting by Karen Pierog; Editing by Matthew Lewis

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