Judge Tosses Chicago Schools Funding Challenge

CHICAGO (CN) – A Cook County judge granted Illinois’ request to dismiss a lawsuit filed by the Chicago Board of Education accusing the state’s school funding system of racially discriminating against its students, but ruled the board could try again with an amended complaint.

Filed in February in Cook County Circuit Court by the board and several Chicago Public Schools parents, the lawsuit claimed the state discriminates against CPS’ 90 percent students of color by distributing less money to their schools. The parents and the board asked the court to force the state into giving the district more funding.

CPS CEO Forrest Claypool said that same month that Chicago schools could close three weeks early if they didn’t get the funds.

“To say that the state’s current scheme of funding public education is broken is to state the obvious,” Cook County Circuit Judge Franklin Ulyses Valderrama said Friday afternoon in a packed courtroom. “But plaintiffs’ complaint is not the vehicle to address this inequity.”

Judge Valderrama did not hold back, saying the state’s suggestion that the city simply borrow more money was “starkly out of touch with reality,” likening the comment to Marie Antoinette saying of her starving subjects, “Let them eat cake.”

The judge also denied the board’s motion for a preliminary injunction that would have stopped the state from distributing any education funds until the lawsuit was resolved, explaining that instead of maintaining the status quo as required, the plaintiffs “seek to alter the status quo in a rather dramatic fashion.”

However, he granted the board permission to file an amended complaint, finding that it could still plead a cause of action under the Illinois Civil Rights Act.

According to the complaint, which cited the landmark civil-rights case Brown v. Board of Education, CPS only gets $0.74 to each dollar received by other Illinois school districts, whose students are 58 percent white. Chicago’s public schools serve 90 percent black, Hispanic and other students of color.

Many, including the state, argue that the district’s pension fund is the real problem, and Illinois says it isn’t responsible for fixing it.

For Fiscal Year 2017, CPS had to spend $1,891 per student on pensions, while other districts averaged only $86, according to the school board’s complaint.

“The state assumes the primary responsibility for funding pensions on behalf of every school district in Illinois – except CPS,” the board said. “Only CPS must divert crucial resources from educating students to satisfying the state’s pension-funding mandate.”

Gov. Bruce Rauner vetoed a bill in December that would have given the district an additional $215 million in pension funding, a move that CPS says is only hurting its students with more cuts.

The state argued in court filings that CPS does in fact receive equal funding when pensions are taken out of the mix, and that the board’s claims under the Illinois Civil Rights Act had no merit.

“Plaintiffs now admit that this case is about teacher pension funding, not the state’s statutory school funding system, which allocates substantially more education funding to CPS than the other school districts in Illinois: 24 percent, even though CPS has less than 20 percent of the state’s students,” a memorandum supporting the state’s motion to dismiss the case says.

Illinois said CPS caused its own budget crisis and the state has no legal obligation to help pull it out.

“There is no doubt that plaintiffs are faced with a massive pension shortfall, caused by many potential factors – historical self-funding of the [Chicago Teachers’ Pension Fund, or CTPF], years of pension funding ‘holidays’ requested by the City of Chicago, and a pension funded ratio of slightly more than 50 percent,” another memo states.

Using drastic cuts to school programs, massive loans and higher property taxes, CPS brought its FY17 budget deficit down to $300 million from a high of $1.1 billion in 2016. More than $720 million of the $5.41 billion budget is going towards pension funding.

Chris Lentino of the Illinois Policy Institute says CPS doesn’t need money from anyone; the city has over $1 billion set aside in a TIF – or tax increment financing – fund that it can tap at any time to bail the district out.

The money, from TIF districts throughout the city, is diverted from property taxes and used for various projects instead of schools.

“The TIFs are essentially political slush funds that breed corruption,” Lentino said in a press release issued Friday. “The city should return the TIF money to where it belongs to ensure students can finish out this school year. Then Chicago should end the practice of TIF districts entirely.”

Although he did not comment on whether or not school would end early this year, Claypool said after Judge Valderrama’s ruling, “We will continue to fight for racial justice for Chicago school children.”

The board, represented by Randall E. Mehrberg of Jenner & Block LLP and the city’s general counsel, is due back in court June 2 for a status hearing. Its amended complaint must be filed by May 26.

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