The Chicago Board of Education delivered a stunning defeat 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 budget, approved by 12 of 20 board members, also does not include a loan, which the mayor’s office sought in order to cover the pension payment and other unexpected shortfalls.

The mayor’s appointees and allies spoke against the budget but never put up an amendment that would have guaranteed CPS would reimburse City Hall $175 million for the pension payment and would have created the possibility that CPS could take a loan.

The budget counts on a record $379 million in surplus funds from the city’s special tax increment financing, or TIF, districts. Senior mayoral aide Jason Lee suggested Wednesday that this money might not come through if the board didn’t commit to making the pension payment. He said CPS has never counted on so much TIF surplus funding in its budget.

The extended budget battle led to the district’s former CEO Pedro Martinez being fired last year.

The same conflict between the school district administration and Johnson arose this summer, even after the school board hired CPS CEO/Supt. Macquline King out of the mayor’s office.

The vote divided the board into two camps, aligned with or opposing the mayor’s wishes. In a twist, the mayor’s chosen leader, King, landed on the side opposing him. The CPS budget proposal she advanced, which did not include the pension payment or a loan, was the one approved Thursday.

Political opponents of Johnson had seized on the controversy, calling him reckless for wanting the school board to approve what they said would be high-interest borrowing akin to a payday loan.

Johnson fired back this week by saying the criticism had racial overtones. He pointed out that, for decades, previous mayors directed the school district to do way more borrowing without being bashed as reckless.

His office maintains that the interest on such a loan would be around more reasonable than has been portrayed — around 5%, much lower than a payday loan.

Johnson and his allies have said their top priority is making sure CPS doesn’t have to make massive harmful cuts to classrooms — even if that means borrowing money.

Check back for updates. This is a developing story.