The Illinois State Board of Education is investigating the finances of Chicago’s public schools as Governor Bruce Rauner seeks to take over the nation’s third-largest district, Bloomberg News reported on Friday. The city school system, whose board is appointed by Mayor Rahm Emanuel, was asked to provide the state officials with records including annual audits, contracts, monthly payroll figures and projected cash flow, according to a letter sent on Thursday to Forrest Claypool, the district’s chief executive officer, and Frank Clark, president of the Chicago Board of Education. The junk-rated school system’s deficit is projected to reach $1 billion a year through 2020 after years of relying on reserves and shortchanging pensions. Rauner, a Republican who is locked in a record-long budget impasse with Democratic lawmakers, wants to change state law to allow the Chicago district to file for bankruptcy and be placed under state control. He promoted chapter 9 as a fix for the district’s woes in the days leading up to its bond sale this month, when it had to pay yields as high as 8.5 percent.
