Published June 5, 2012 on Crain's Chicago Business
By Greg Hinz
The city's beleaguered tax-increment financing program is taking another big hit, this time over where and how it's spent more than $800 million building and repairing public schools.
A report being released today by Roosevelt University assistant sociology professor Stephanie Farmer concludes that TIF expenditures, instead of reducing inequality, are "contributing to income and race/ethnicity place-based inequality."
In particular, it says, selective-enrollment schools like charters and magnets get a disproportionate share of the available cash. That shortchanges open-enrollment neighborhood schools, it says — echoing a frequent charge from the Chicago Teachers Union.
The report specifically examines how the city has spent $858 million in TIF money on schools since 1983. The money makes up a little more than a fifth of all TIF spending.
City officials frequently have cited the $858 million as proof that a substantial share of TIF resources goes not to subsidize big property developers or to spur construction downtown but to needy neighborhoods.
But the report challenges that assertion head-on.
In fact, Ms. Farmer reports, open-enrollment neighborhood schools have received just 48 percent of the TIF cash, even though they make up 69 percent of all schools.
In contrast, it says, selective schools and privately managed charters have done much better, with nine selective-enrollment high schools that make up 1 percent of the total number of schools getting 24 percent of the money spent on school construction projects.
As a result, it says, schools with a Latino population at or above the citywide average got just 27 percent of the money, though they enroll 44 percent of all CPS students. And heavily white schools got 23 percent of available TIF money, even though white students make up about 9 percent of citywide enrollment.
Black students fared somewhat better, too, constituting 42 percent of CPS students citywide and their schools getting 55 percent of TIF money.
Roughly the same pattern holds when schools are divided by relative wealth of the neighborhoods they're in.
The top one quarter of schools by neighborhood wealth got 36 percent of TIF money, and the bottom quarter 36 percent. The middle half got just 28 percent of the $858 million.
The report, prepared for the research group Chicagoland Researchers and Advocates for Transformative Education, also has one other analysis. It chooses 30th Street as the geographic center of the city and finds that 78 percent of schools that got TIF money are in the northern half.
But Ms. Farmer said 30th Street is only a geographic division and that she does not know offhand whether most students or schools are north or south of there. That skews any conclusion, in my view.
Despite that flaw, the report appears to offer some new data on the question of whether Chicago's TIF districts are lifting up poor and blighted areas — the original intent — or merely are being used for citywide goals.
The report concludes the latter, saying the TIF-funded construction "adds to the widening gap between affluent Chicagoans and everyone else."
I shared a copy of the report with CPS officials last evening, and they had no immediate response. But expect to hear lots more on this one.
The question: Is it better to focus the cash on selective, often innovative schools whose students test well? Or would other schools do better, too, if they got more of the money?
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