The Chicago Board of Education recently sued Illinois Governor Bruce Rauner, claiming that the way Illinois funds its schools violates the state constitution and effectively creates a “separate but unequal” system. And now, due to a massive budget shortfall, Chicago Public Schools (CPS) suggests that they may need to end the school year more than two weeks early.
Beyond the inequity of the school finance system, the lawsuit further alleges that the teacher pension system is also at fault for treating Chicago’s students as “second-class children.”
Over the past few months I have analyzed 10 years’ of Illinois salary data precisely to determine the degree to which Illinois’ and Chicago’s teacher pension system contribute to school funding inequity.
Although we won't release final numbers for a few weeks, the results are alarming.
Statewide, the schools serving the highest concentration of low-income students receive only half of the state average per-pupil expenditure on teacher pensions. And, around 60 percent of those low-income, poorly funded schools are in Chicago. In other words, the teacher pension system is compounding Illinois’ funding issues.
Teacher pension systems compound inequitable school funding for a variety of reasons. In Illinois, the biggest problem is that Chicago operates its own teacher pension system separate and apart from the state fund. In other words, Chicago, which has the highest concentrations of high-poverty schools, receives practically no pension funding from the state. And with fewer resources and a smaller tax base at its disposal, Chicago typically contributes to the fund at an even lower rate than the state. The result is a wide disparity in school funding becomes even wider after accounting for pension spending.
Other factors also contribute to the problem. For example, higher-poverty schools tend to have higher student-teacher ratios. They also have more new teachers (with lower salaries). Many of these younger teachers will leave before qualifying for a pension, and therefore will forfeit their state or district contributions.
While the full findings of my study are still under wraps, the conclusions are clear: teacher pensions exacerbate school funding inequities in Illinois. Until the state fixes its inequitable school funding formula, and the pension plan that amplifies and compounds those inequities, Illinois will continue to funnel less money to the kids who need it the most.