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Study by Roosevelt professor reveals inequities in tax increment financing for school construction projects

Posted: 06/05/2012
A new study examining where tax increment financing (TIF) proceeds go for construction in the Chicago Public Schools finds selective enrollment, charter and magnet schools are favored over traditional schools open to all in a neighborhood or community.

The study by Roosevelt University sociology professor Stephanie Farmer shows that CPS schools that limit enrollments, based on test scores, lotteries and/or other factors, receive more funds for development through TIF than neighborhood schools with open enrollments.

“What this study suggests is that we are creating an unequal school system in which those that limit whom they will accept are being rewarded to develop further,” said Farmer, who analyzed disbursement of $857 million in TIF funds to 28 CPS schools based on school type, location as well as income and race demographics.

The study found that the lion’s share of TIF funds went to schools with an exclusive enrollment process, in spite of the fact that the lion’s share of the school system – 69 percent of all CPS schools - accept children based on the neighborhood in which they live.

The CPS neighborhood schools received $414.6 million, while schools with limited enrollment, including charters, magnets, and schools with charters contained within their facilities received as well as charters created prior to 2010, received $443 million or 52 percent of all funding.

“The study shows that inclusive neighborhood schools are getting short changed in order to expand exclusive schools.  We need a more equitable means of disbursing TIF funds for all CPS,” Farmer said.

Among findings, the study released by Roosevelt University in conjunction with Chicagoland Researchers and Advocates for Transformative Education (CReATE) also showed that:

•    1 out of 3 schools receiving TIF funds were located in communities with the highest socio-economic standing, as measured by CPS.  This is in spite of the fact that the original purpose of the city’s TIF program was to use TIF funds for development of neighborhoods in decline.

•    One quarter of all schools receiving TIF were located in communities whose median income exceeds the median income for the city of Chicago as a whole.

•    More than three-quarters of the schools receiving TIF funds were located north of 30th Street.

Farmer said the data also suggested that schools with largely Latino populations received less TIF money then did schools with largely white and African American student populations.  

To learn more about the study, view the report [PDF] or visit the Crain's Chicago Business blog on government and politics by Greg HInz at http://www.chicagobusiness.com/article/20120605/BLOGS02/120609940  .