Mayor Johnson Loses Year-Long Battle to Take Out $200 Million Loan

Mayor Brandon Johnson lost a big battle last week, one he’d been fighting for a long time. Johnson had done everything he could to force the city of Chicago’s school board to approve a new $200 million high-interest loan which was backed by the Chicago Teacher’s Union (CTU). Johnson had packed the school board with his own appointees but in the end, several of them turned against him and voted against the loan.

The Chicago Board of Education delivered a blow to Mayor Brandon Johnson on Thursday by approving a budget that does not guarantee the school district will make a controversial municipal pension payment — a move that could leave a $175 million hole in the city’s bank account.

The $10.2 billion budget, approved by 12 of 20 board members, closes a $734 million deficit but does not include a loan, which the mayor’s office sought in order to cover the pension payment and other unexpected shortfalls.

Most of the mayor’s appointees and elected allies spoke against the budget but did not make moves to change it — and crucially, some unexpectedly voted in favor of the budget and tipped the balance.

This is a genuine embarrassment for the mayor and it is one that has been a year in the making. Simply put, this all stated with a projected budget shortfall in the school system. With the end of COVID-era handouts for schools, the city was quickly running out of other people’s money to cover expenses including a $175 million pension payment. One option would have been to raise taxes and another would have been to cut staffing and salaries to balance the budget. But Mayor Johnson and the CTU had another plan, they would take out a short-term loan to cover the gap. 

Johnson has pushed [Chicago Public Schools] to take a short-term, high-interest loan to support its budget this year. That would help pay for rising expenses and for a pension payment for non-teacher CPS staff that has weighed down the city budget. New costs are expected once CPS settles contracts with both the CTU and a new principals union.

The board agreed with Martinez over the summer that a loan wasn’t a solution. Board members also refused to take on the pension payment. Instead, Martinez has privately floated staff furloughs and layoffs…

CPS is a habitual borrower, issuing both long-term and short-term debt annually. But in an internal memo arguing against this particular loan, CPS officials insisted that the short-term loan proposed by Johnson is different because it would cover operating expenses without expected revenue to pay it back. CPS called it expensive “crisis borrowing” and said it would result in credit downgrades. CPS bonds are currently ranked at junk status after a slew of borrowing between 2016 and 2018.

So this was the basic battle taking place between Mayor Johnson and his teacher’s union backers on one side and the school board and the CEO of Chicago public schools on the other side. Austin Berg describes how that fight has gone over the past year.

• The entire school board resigned in October.

• CPS CEO Pedro Martinez endured a months-long smear campaign by the CTU, which culminated in his firing just before Christmas.

• A majority of school board candidates who won their elections in November vocally opposed the loan on the campaign trail.

• Johnson’s new CEO, Dr. Macquline King, refused to include the loan in her proposed budget.

• The powerful SEIU Local 73 broke from the CTU and opposed the loan.

• A majority of City Council members signed a letter opposing the loan, including staunch Johnson allies like Byron Sigcho-Lopez and Jeanette Taylor.

• Chicago Public Schools’ chief budget officer warned the loan would trigger a “downward spiral” of credit downgrades, higher borrowing costs and cuts.

Last week, a majority of Chicago Aldermen issued a letter opposing the loan.

BREAKING: 27 of 50 Chicago aldermen are out with a letter telling Chicago Public Schools board members to reject a high-interest loan pushed by Mayor Brandon Johnson and Chicago Teachers Union President Stacy Davis Gates. The vote is scheduled for tomorrow. 🧵 https://t.co/qVtnSVPHML pic.twitter.com/mCffSm9oTX

— Austin Berg (@Austin__Berg) August 27, 2025

Mayor Johnson reacted to this by having a race-bating meltdown.

Chicago mayor Brandon Johnson: “When you put a Black man in charge of a city, all of a sudden everybody wants to be an accountant.”

Doesn’t seem like a healthy way to run a city. pic.twitter.com/u9KcXHDVuN

— Richard Hanania (@RichardHanania) August 31, 2025

There’s no racial angle to this story. The CEO of public schools and many of the school board members who voted against this loan are black or Hispanic. This is just Mayor Johnson doing what he does, blaming his own failures on racism.

Last week it seemed that, despite the pushback from the school board, Mayor Johnson was likely to win this battle over the loan because he had personally appointed a majority of the new board members. He even appointed one board member on the day the vote was set to take place. That led to some squabbling when the board opened its meeting on the day of the vote.

The board meeting began with fireworks, as member Che “Rhymefest” Smith called out newly appointed board member Angel Velez for his intent to vote on the loan just minutes after being sworn in. https://t.co/MCYpl2Pq72

— Austin Berg (@Austin__Berg) August 31, 2025

But in the end, several board members appointed by Mayor Johnson turned on him and voted to pass the budget without the $200 million loan he wanted. In the top clip you can see the vote take place and below that is a breakdown of who voted to pass it. The faces in red are all members of the board appointed by the mayor. Had they all sided with Mayor Johnson, he would have won this battle.

The board voted 12-7 for Dr. King’s budget (and against the loan).

Three Johnson appointees voted in favor of the budget: Ed Bannon, Anusha Thotakura, and Cydney Wallace. Another, Debby Pope, abstained.

CPS is the largest municipal junk-bond issuer in the nation for a reason… pic.twitter.com/rJMtFLf9CK

— Austin Berg (@Austin__Berg) August 31, 2025

The bottom line is that Mayor Johnson really wanted this expensive and irresponsible handout to his supporters in the teachers union and, despite pulling out all the stops to rig the vote, he didn’t get it. That’s good news for the city but obviously makes the mayor look like a failure. I’ll close this up with a great paragraph from Jeff Blehar at NRO who lives in Chicago.

The stories of Johnson’s idiocy are so many, so varied, and so improbable that they have taken on an aspect of Paul Bunyanesque folklore. (“Gather round children, and let me tell you a tale from an age when giant failures strode the earth.”) Yes, Brandon Johnson’s name, much like his fellow Illinoisan Abe Lincoln, belongs to the ages now: He’s a legend, but not in a good way. The city of Chicago currently faces a yawning $1.2 billion budget shortfall, driven by Johnson’s spendthrift profligacy, and that arguably ranks as only the fourth biggest mistake he’s made in the last twelve months alone.

He makes the era of Lori Lightfoot look like a golden age of competence by comparison.

Join Hot Air VIP and use promo code FIGHT to get 60% off your membership.