On October 4, 2017, Chicago Public Schools (CPS) agreed to drop its lawsuit against the state of Illinois over education funding distribution. The lawsuit was voluntarily dismissed by CPS without prejudice, meaning that CPS could still choose to re-file the case at a later date. Filed on February 14, 2017, by five families, the suit claimed that Illinois had violated the civil rights of students by distributing fewer funds to Chicago public schools than other public districts across the state. CPS alleged that only 76 cents were spent on Chicago students for every dollar spent on children in public schools outside of the city leading to a $500 million funding gap for Chicago public schools.
Chicago schools have been plagued with financial issues for some time. Because CPS maintains its own pension funds for educators rather than participating in a state-subsidized retirement system like other school districts, escalating pension payments have drained reserves and led to debt increases and junk bond ratings. The crisis escalated further when the governor vetoed a bill that would have granted $215 million to cover its pension obligations.
The plaintiffs alleged that Illinois’ funding scheme treated CPS students, who are predominantly African American and Hispanic, as second-class children and relegated them “to the back of the state’s education funding bus.” Chicago schools are 38% black, 47% Hispanic, and 10% white as opposed to schools outside the city, where 58% of students are white. In April of this year, the lawsuit was initially dismissed by Cook County Circuit Court Judge Franklin Valderrama for failing to allege discriminatory practices under Illinois’ Civil Rights Act.
Judge Valderrama did, however, give CPS a limited period of time to amend and refile its suit, which CPS did in May of 2017. However, later this summer, Illinois legislators reached an accord with Governor Bruce Rauner on reshaping the Illinois’ education distribution system. As part of the deal, Illinois agreed to take on the bulk of CPS’s costs of financing their pension fund and raise taxes to make up for years of skipped pension contributions. CPS’s dismissal of its case against the state is thought to be a result of the deal that was reached.
What This Means to You
This case and the manner in which it was resolved is strongly indicative of the fact that litigation can be a tool for school boards and public school districts to bring attention and resolutions to issues involving funding, discrimination, and demographic disparities. This post serves as an update to the Husch Blackwell Education team’s webinar with the Council of Great City Schools on local control and funding issues occurring across the country. For updates on school funding issues impacting K-12 education, subscribe to Husch Blackwell’s K-12 Legal Insights blog.