Chicago’s public school system has become a showcase for the negative effects of K-12 privatization, according to a new report that tracks how the city replaced struggling local schools with dozens of charters that didn’t perform better, yet deprived traditional schools of funds, students and public accountability.

The report, "Closed by Choice: The Spatial Relationship between Charter School Expansion, School Closures and Fiscal Stress in Chicago Public Schools,” tracks 108 charter schools that opened between 2000 and 2015, a period when Chicago Public Schools (CPS) was shutting struggling schools, cutting district funding and reducing staff. It details and confirms what many charter critics have long said, that lobbying from pro-privatization forces swayed the city’ political leaders to impose top-down reforms that riled neighborhoods, undermined traditional K-12 schools, increased segregation and did not lead to schools with better academic results.

Perhaps most insidiously, the report describes in great detail how the CPS system aggressively shut down struggling schools in neighborhoods where student numbers were dwindling, while allowing better-funded charters to open up nearby, taking a greater share of taxpayer funds that might have been used to rescue struggling schools. The report was written by Roosevelt University’s associate professor of sociology Stephanie Farmer, Loyola University PhD candidate Ashley Baber and University of Illinois PhD candidate Chris Poulos.

“CPS’ approach to saturating neighborhoods with declining school-age population with new charter schools is stripping all middle- class, working-class and lower-income children, families, and communities of education security, where schools are rendered insecure by budgetary cuts, deprivation, or closure,” the report’s conclusion begins. “Education insecurity is the product of the school reform agenda focused on cannibalizing the neighborhood public schools in order to convert CPS into a privatized 'choice' school system.”

“While new charter schools continue to proliferate in low demand neighborhoods, all CPS neighborhood public schools experience debilitating budget cuts that lead to the elimination of teaching professionals and enriching curriculum,” it continues. “The most vulnerable communities are stripped of their public school, or their remaining neighborhood public school is rendered unstable by the proximity of new charter schools.”

The impact of these decade-long policies is clear, the authors say, calling for a charter school moratorium in the city, more oversight and public accountability for the charters, and abolition of the state’s charter school authorizing commission.

“Working- and middle-class children are also not getting the resources they need, like relief from overcrowded conditions,” the report says. “The cuts and deprivation across CPS neighborhood public schools underscore the problem of opening too many new schools in a system caught in the vice grips of austerity—there are not enough funds to provide all schools with the resources needed to succeed.”

Report Excerpts

Chicago Public Schools currently has 131 charter schools with over 58,000 students (approximately 15% of the city school district). They get the same per pupil allocation as neighborhood public schools, but also tap federal, state and local grants, private foundation grants, and private fundraising. For the 2015-'16 school year, CPS charter schools received over $700 million in tax dollars, the report says.

What follows are 11 excerpts from the report that support its conclusions.

1. CPS charters are privately run. “In exchange for these tax dollars, a charter operator enters into a three- to five-year contract with CPS to operate a school. Charter schools are not operated by the Chicago Public Schools central office but rather are privately operated and controlled. They have their own board of directors. Charters do not have to abide to the same accountability and transparency standards that public schools are expected to follow. Charters are largely autonomous from the Chicago Board of Education, CPS central office mandates, elected Local School Councils, and public accountability standards regulating traditional public schools."

2. The city shut under-used schools. The report describes how the Chicago Board of Education (CBOE) created a metric to close schools with fewer students than might otherwise be optimal, and then situated new charters in those same neighborhoods.

“Using the CBOE 'under-utilization' metric, [Democratic] Mayor [Rahm] Emanuel shuttered 49 so-called underutilized schools, almost 10% of CPS’ entire school stock. Mayor Emanuel justified the massive closures as a strategy to contend with CPS’ billion-dollar deficit because, as the Chicago Tribune reported, 'they could not afford to keep operating deteriorating schools with dwindling student populations in the face of a billion-dollar budget deficit.' Like previous waves of closures, 90% of impacted students were African American.”

3. The mayor sided with billionaire privateers. The report describes how the city’s political elite fell under the spell of the charter industry’s billionaire sponsors, in this case Microsoft founder Bill Gates. Gates is among many billionaire entrepreneurs who believe that charters can remake public education in ways that mimic corporate success stories, including a major emphasis on teaching to the test—a reflection of Silicon Valley’s metric-centric values. Traditional educators say teaching needs to be more individualized and nuanced. Here’s how the report describes Chicago’s open-ended embrace of charters and Gates, starting with shutting schools over local protests.

“The large number of school closures generated significant parent, school, and community protests. In response to the political fallout, CPS committed to a five-year moratorium on district-operated school closures. Soon after the 2013 school closures, it became apparent that CPS had no real commitment to 'right sizing' the school system. At the same time it was mulling over which of its 129 'underutilized' schools to close in 2012, CBOE entered into the District–Charter Collaboration Compact with the Bill and Melinda Gates Foundation. Through this relationship, CPS agreed to open another 60 charter schools in the next five years, even as CPS enrollments were shrinking and existing charter schools could not fill 11,000 vacant seats in their schools. Many of the 40 new charter schools opened since the Gates Compact agreement have been located within 1.5 miles of the 49 public schools closed due to low enrollments.”

4. Many charter impacts, starting with more segregation. The report found what is often the case in communities with charters; that they lead to more segregated schools, as low-income parents seeking the best for their kids respond to industry marketing efforts. The schools, in turn, cherry-pick students, which means they are frequently rejecting special needs children, whether those with disabilities or whose primary language is not English. Those kids are then pushed back into traditional public schools, whose budgets have been undermined by charters.

Here’s how the report discussed this trend in Chicago, starting with the resulting segregation:

“Charter schools are open to all students across the city without entrance exams or tuition. Students must apply to enroll in the school. If there are more applicants than available seats in a charter school, the school must hold a citywide lottery to pick its student body. As such, charter schools do not have to admit local neighborhood children. As a result of this self-selecting application process, charters are more segregated by race and class compared to neighborhood public schools.”

Here’s how the charters cherry-pick students and push more challenging students back to traditional K-12 schools:

“Charter schools also have a history of excluding student English language learners and students with special needs; expelling students for discipline policy violations at 10 times the rate of CPS expulsions; and “counseling-out” poor test takers by nudging these students to drop out and enroll in another school.”

5. Charter academics no better than public schools. While there have been charter success stories, the industry as a whole has not met its over-hyped results. This is a key part of charters' typical sales pitch to political officials like Chicago’s mayor, who embraced them rather than invest in the harder work of improving traditional schools. Reporters from the city’s newspapers and journalism schools found charters were no better than the schools they replaced. Here’s how they put it:

“Northwestern University’s Medill School of Journalism and the Chicago Sun-Times determined that the average Illinois Standards Achievement Test scores by elementary students at charter schools and neighborhood schools in Chicago 'were in a virtual tie on the reading and math exams.' Neighborhood schools made stronger gains in reading growth and just slightly higher gains in math growth, relative to charter school growth. In the aggregate, Chicago’s charter and neighborhood public schools have similar levels of student test performance. Any differences in either direction tend to be slight.”

6. Charters seriously disrupt neighborhoods. This finding is the one that most often gets overlooked in the public policy debates about charters and K-12 school reform. Nobody wants to see troubled schools in their community. But instead of taking steps to improve the struggling schools, the city imposed a heavy-handed solution that in many cases did not even include serving the neighborhood’s children.

“Our data shows that between 2000 and 2015, CPS closed 167 neighborhood public schools. Since 42 of the 167 closed schools were 'turn-around' schools and were reopened as neighborhood public schools, we excluded those from the total number of neighborhood public schools that stayed closed to the neighborhood’s children. We count the 15 neighborhood public schools that were closed and reopened as new public schools with some kind of exclusive enrollment criteria as closed neighborhood public schools. We also count the 31 closed neighborhood public school buildings that were reopened as new charter schools as closed neighborhood public schools.”

7. Charters undermining surrounding K-12 schools. This pattern is not unique to Chicago, but it’s happening on a large scale there. Because the city placed its charters in neighborhoods with shrinking student populations, they are drawing some students away from nearby traditional schools. That, in turn, undermines programs in those traditional schools by virtue of diverted per-pupil taxpayer funding.

Here’s how the report discussed this trend:

“The largely unplanned saturation of charters in neighborhoods experiencing distress from declining population during the Ren10 years [mostly since 2000] contributed to low enrollments in nearby CPS schools that were later used to justify closing neighborhood public schools. Spatial proximity of new charter schools to closed schools matters. Since charter schools draw their student populations from the surrounding neighborhoods, public schools were forced to compete for students in neighborhoods with declining population. Even if there is not a direct one-on-one, or unilineal, relationship between a new charter and declining enrollments at the most proximate neighborhood school, these charter schools will nonetheless capture some share of children from the surrounding neighborhoods.”

8. Charters don’t follow the rules set for other schools. Part of the sales pitch by education privateers is that charters should be freed from government regulations and allowed to innovate. What that often means—apart from creating a management class where fiscal self-dealing has become a national pattern—is charters don’t have to follow the same rules and accountability standards as traditional K-12 schools. Here’s how they put it when the issue was deciding which schools would be forcibly shut down or stay open:

“CPS appears to have operated with a double standard by determining whether a neighborhood public school should remain open based on utilization factors while CPS did not adhere to this standard when rolling out new charter schools. Instead, CPS opened new charter schools in areas that were experiencing distress from declining population and school closures. In other words, CPS was not concerned about 'right-sizing' the system when it came to opening new charter schools in neighborhoods already under distress.”

The report strongly suggests that political decisions were made to tip the balance in favor of privatization by Chicago’s establishment. It continues:

“Furthermore, it is questionable whether there was a need for the new charter schools opened in the 2010s. During the 2010 and 2015 period, existing charters were not filling their seats. While it is the case that some charters have more applicants than available seats, other charters have an abundance of empty seats. Illinois Raise Your Hand (RYH), in conjunction with Apples to Apples, conducted their own independent investigation of CPS data, looking at student enrollment in charter schools. Using CPS’ underutilization standard, Apples to Apples determined that in the 2012-2013 school year '47 percent of CPS charter and contract schools had student populations below the CPS threshold for ideal enrollment.' This meant that nearly 11,000 seats in charter schools remained empty as the city was closing 10% of public schools while opening another 40 new charter schools.”

9. Opening unneeded schools—and giving them more money. Here the report shows how corruption unfolds with serious anti-democratic consequences. It’s not enough that Chicago charters were given the go-ahead to open in areas where the city’s standards wouldn’t allow traditional schools to do likewise. The city decided to allocate more money for charters than for traditional schools—even in a budget crisis where traditional K-12 schools were facing funding cuts. Here’s how they put it:

“In 2012, Chicago Public Schools implemented a 5% increase in per-pupil allocation for charter operation expenses and a large increase in the per pupil stipend to cover charter facility expenses. The increase to charters’ per pupil allocation occurred at the same time CPS cut $100 million from neighborhood public schools. While neighborhood public high schools experienced a 14% decline in their budgets (even though student enrollments only declined by 2%), charter schools enjoyed a 12% budget increase (even though they were enrolling 10% more students).”

10. Helping charters buy buildings the public won’t own. This is another dimension of how charters have a dark underbelly of fiscal self-dealing with no parallel in the traditional K-12 sphere. The charters, using a mix of for-profit and non-profit arms, tap public funds to acquire real estate they end up owning. Here’s how the report describes that giveaway:

“The public not only finances charter school operations but it is also on the hook for paying for charter school facilities. Charter schools acquire their school buildings through a variety of mechanisms: some rent their building from a non-CPS source, some lease from CPS, and others pay for new construction. Charters that rent from a non-CPS source receive a per pupil allocation from CPS to cover the rent. When charter networks opt to construct a new building, they too get a per pupil allocation to cover the cost of the facility. Since taxpayer dollars are the primary revenue source used to pay back charter bonds, charter school debt is effectively off-the-books public debt. However, the public does not have ownership rights of charter school buildings. Rather, charter operators retain ownership. Since charters contribute to the conditions where public schools are closed, the public is effectively paying for new and to some degree redundant privately-owned schools while their existing public buildings are being shuttered.”

11. Meanwhile, Chicago ignores overcrowded K-12 schools. This is another insidious result from the warped educational landscape charters have brought to Chicago. While there’s taxpayer money for privatized schools, there’s a corresponding lack of public funds available to help dozens of traditional schools deal with overcrowded classrooms and sub-standard facilities. Here’s how they put it:

“The impact of stretching limited funds across multiple schools contributes to school closure and budget cuts but it also impacts overcrowded schools. CPS has 68 overcrowded schools that cannot get the resources they need to educate their children. Overcrowded classroom conditions can be claustrophobic, noisy and prevent the teacher from having sufficient one-on-one time with each student. For example, the Better Government Association identified Avalon Park Elementary School on the South Side as one of the most egregious examples of overcrowded classroom conditions, where in 2015, they had a kindergarten class with 51 children and a first-grade room with 48 kids. To relieve overcrowding in schools, schools often resort to drastic measures such as holding classes in hallways, closets and even staircases.”

Conclusions

The report's authors note that the issues Chicago faces are a microcosm of national trends. There has been no shortage of local activism that’s called on the city’s school chiefs to refocus their priorities and reinvest in traditional neighborhood schools, they point out. In 2016, voters in two Chicago wards approved non-binding resolutions calling for a citywide moratorium on new charters. This is the proposal that the NAACP’s national board of directors called for last year and is also supported by the Black Lives Matter movement.

Perhaps no one should be surprised that billionaires like Bill Gates can exert disproportionate influence in public policy arenas—even when Democrats are the governing class, as is the case in Chicago. Charters have also prospered in deep-blue California, despite vigorous protests from labor unions and community groups. The report shows how Chicago’s political leaders have given the industry a veritable blank check. Look at how they describe what charters need to do to get approved:

“There is no citywide school facilities plan that determines where the most need is for new charters. As the process works today in Chicago, when charter schools apply for a charter license, they do not have to include a specific address where they will locate the school. The Chicago Board of Education (CBOE) blindly approves new charters without determining if there is a need in that neighborhood or if it is best fit for the overall school system. The lack of planning is one of the reasons why redundant charter schools have saturated neighborhoods with declining school age populations.”

This is how education privatization works. There’s nothing stopping Bill Gates and all the regional and national education franchises from investing in private schools. They simply don’t want to. Instead, they want a slice of the billions taxpayers are spending each year to educate a community’s children. Right now in Chicago, as this latest report shows, that is $700 million annually creating more problems than solutions in public education.