Slowdown in home sales means parents face questions about city schools
BY JOHN PLETZ, CRAIN'S CHICAGO BUSINESS, MARCH 26, 2012
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When Jill and Paul Syftestad's oldest daughter was ready to start school four years ago, they put their School townhouse on the market and planned to move to the suburbs.
One offer fell through at the last minute and a second was well below their asking price. "We had our hearts set on moving," says Ms. Syftestad, an IT project manager at a nursing association. "We were devastated. We pulled it off the market and decided to stay."
The recession dramatically slowed the number of people making the trek to the suburbs for bigger houses, safer neighborhoods and better schools. Unable or unwilling to leave the city, a small but growing group of middle-class families are turning to Chicago's public and private schools, a development that holds both potential and peril for Mayor Rahm Emanuel and his efforts to improve the school system.
"I've had lots of clients who thought they would be able to sell their condo and can't. So they are now trying to make it work" in city schools, says Christine Whitley, an education consultant who helps families through the Chicago Public Schools selection process. "They bought their condo way before they had kids and didn't really factor schools into the equation. They figured they could sell and move to a better neighborhood or move to the suburbs. Now they can't sell it, so they're trying to figure out options" in the city.
This week, anxious parents will find out whether their kids will get coveted slots in the city's selective-enrollment elementary schools, a process determined by test scores, or magnet schools, determined by lottery. Selective elementary school applications have increased by 50 percent in the past four years, dwarfing the 12 percent increase in high-school applications that has sparked so much concern in the past month as the city tweaked its selection criteria.
"People are trapped," says Tina Feldstein, a broker at Southport Sotheby's International Realty in Chicago and president of the Prairie District Neighborhood Alliance, a School association. "If they sell, they'll take a major loss. They're not in a position to do it. Everyone's saying, 'Next year, it will improve. Prices will get better.' In the meantime, they're forced to become involved in CPS schools."
The slowdown in the decades-long procession to the suburbs provides Mr. Emanuel with the chance to bolster the city's middle class and make greater strides in improving CPS than his predecessor, Richard M. Daley.
This constituency—whether or not it wants to be in the city—has the skills and the clout to demand better schools and a personal stake in the outcome. Those factors could be game-changers in the struggle to turn around a system labeled the worst in the nation by the U.S. secretary of education in 1987.
But Mr. Emanuel will have to make hard choices at a time when resources are dwindling, and he must move quickly before the real estate market rebounds and more parents leave.
Paul and Jill Syftestad had planned to move to the suburbs when their oldest child started school but decided to stay in the School. Photo: Erik Unger
"There's a huge opportunity that Rahm has to attract and keep families in the system who otherwise would have left," says Timothy Knowles, director of the University of Chicago Urban Education Institute. "It's going to come down to strategic choices: Do you make investments in education or policing to make neighborhoods safer?"
These new families are clamoring for more investment and putting pressure on local politicians.
"It's the No. 1 issue in my ward," says Ameya Pawar, alderman for the 47th Ward on the city's North Side. "I hear about it all the time. Parents are trying to navigate CPS and get the best education for their kids as possible. At some point the market is going to come back. We need to figure out how to keep people here and get new people moving in. We've probably got three to five years."
The increased demands put additional pressure on a city facing a severe budget squeeze. Chicago had to close deficits of more than $500 million annually in each of the past three years. Budget gaps in the school system have ranged from $475 million to $712 million. But the heightened attention also strengthens Mr. Emanuel's hand against the teachers union as he pushes for a longer school day, closes underperforming schools and supports charter schools.
"The question is how much political will there will be and whether there's so much pushback that people get cold feet," Mr. Knowles says. "To do it at the scale they need, they'll have to enlist civic engagement in a much more significant way."
Mr. Emanuel declined to be interviewed about how the changes in mobility are affecting city schools. Chicago schools CEO Jean-Claude Brizard, after initially agreeing to talk, turned down multiple attempts to speak with him over two weeks.
CPS Director of Media Affairs Robyn Ziegler released a statement that the school system is laboring to increase the seats in high-performing schools, lengthen the school day, create a more rigorous curriculum and develop better training for principals.
"It is part of our mission to engage these parents in a robust and meaningful way," wrote Ms. Ziegler. "CPS has never truly engaged parents in this way, and we are working to break away from this status quo approach that has alienated parents from the process."
Tarrah Cooper, the mayor's press secretary, released a statement that Mr. Emanuel says learning "starts at home with a dedicated parent committed to their child's education. In order for our children to succeed, every school must have an accountable principal, dedicated teachers and active parents."
Mr. Pawar says the city knows it has an opportunity to keep families by improving the schools. He points to a recent decision to add specialty programs in science, technology, engineering and math at five high schools, including Lake View in his ward. The city teamed up with tech giants Motorola Solutions Inc., Cisco Systems Inc., IBM Corp., Microsoft Corp. and Verizon Communications Inc. to develop the programs.
"That was a tipping point," the alderman says. "They're looking for ways to hang on to people and give them reasons to stay."
Rebecca Labowitz, a parent who blogs about the school system at CPSObsessed.com, points to the district's newly formed Portfolio Office, which has community liaisons work with parent groups at individual schools.
Parental involvement is particularly effective at the elementary level. Activist parents raise money, expectations and standards. Some of the best-known examples are Alexander Graham Bell, Blaine, John C. Coonley and Nettelhorst elementary schools on the North Side. Nonprofit groups such as Friends of Coonley routinely raise more than $100,000 annually for extra teachers, equipment and programs such as ecology.
"Coonley was going be a school that was going to close," says Mr. Pawar, whose ward is home to Coonley, Bell, Waters and Audubon schools. "Now it's one of the best schools in the city."
'STUCK IN THEIR HOMES'
The total number of people staying in the city who otherwise would have moved isn't huge: perhaps 5,000 to 10,000 a year over the past few years. But it's a big change in the trend line: CPS enrollment dropped significantly in the middle of the last decade but largely has been stable at about 400,000 since 2007-08, when the recession hit. Enrollment at the 10 largest suburban districts, which had been growing quickly, also generally has been flat since the recession began, according to data from the Illinois Board of Education.
During the last quarter-century, thousands of people flooded annually into suburban DuPage and Will counties, making them among the fastest-growing jurisdictions in the country. But when the recession hit, housing prices fell and job losses rose.
The number of people leaving Cook County for the collar counties dropped by an average of 35 percent between early 2007 and 2010, according to Internal Revenue Service data.
From the real estate market peak in 2005-06 until 2009-10, those moving from Cook to DuPage dropped by 25 percent, according to IRS data compiled for Crain's by Geoffrey Hewings and Chenxi Yu of the Regional Economics Application Laboratory at the University of Illinois at Urbana-Champaign.
Movement to Kane County dropped by 37 percent, Lake County 38 percent, Will County 53 percent, McHenry County 54 percent and Kendall County 56 percent. After nearly quadrupling from 1997 to 2007, enrollment at Plainfield Schools in Will County flattened out, then dropped the past two years.
"People still want to move" to the suburbs, says Larry Reedy, an agent at L.W. Reedy Real Estate in Elmhurst. "But there are a lot of people stuck in their homes. For a large chunk of people, they just can't bring money to the closing table" to cover the difference between their loan amount and the lower sales price on their house.
There also is an increase in residents who want to stay in the city. Chicago, like other big cities, saw its population rise from 1990 to 2000 as 20- to 29-year-olds moved in search of nightlife, jobs and short commutes. But Chicago was the only one of the 10 largest U.S. cities to see its population fall between 2000 and 2010, dropping by 6.9 percent, Brookings Institution researcher William Fry said last week. Many big urban counties in the U.S. regained momentum at the end of the decade, outgrowing nearby suburban areas as the recession hit. The same general pattern can be seen for Cook County, though suburban growth here still remained slightly higher at the end of the decade.
"I have always said we'd stay in the city so long as the schools were working," says Julie Kraft, a banker who works downtown and lives on the North Side and whose children go to Louis J. Agassiz School in Lakeview. "At this point, I could see myself staying in the city throughout their education. We never said outright that as soon as they go to school we'd have to be in the suburbs."
Parochial schools are benefiting, too. Enrollment at Catholic elementary schools in Chicago is up in each of the past two school years, the first time that's happened since 1965. Suburban enrollment fell by 5.3 percent over two years, according to the Archdiocese of Chicago, mirroring a national decline in Catholic school enrollment.
One of the fastest-growing schools is Old St. Mary's in the School, where the Syftestads' daughter Olivia is a third-grader. She started kindergarten in a CPS school but transferred because of large class sizes, Ms. Syftestad says, highlighting one of the challenges facing the mayor.
"We're OK through elementary school. We'll stay in the city as long as we can, provided we can navigate through CPS" for high school, she says. "If not, we'll have to make the move. It's a question we talk about all the time. We have about three years to figure it out."
Grace Sawin, co-founder of Chicago School GPS, at a recent seminar for parents at Sulzer Regional Library in Lincoln Square. Photo: Stephen J. Serio
Independent private schools also are growing. Median enrollments rose by 11 percent from 2007 to 2011 at the dozen independent Chicago private schools—which includes Latin School of Chicago in the Gold Coast, Francis W. Parker School in Lincoln Park and the University of Chicago Laboratory School in Hyde Park—that are part of the Independent Schools Association of the Central States. Francis Parker and Latin have seen upticks in applications in recent years even as the recession caused some students to leave.
COMPETITION
One of the most immediate effects of the slowdown in suburban flight is the soaring interest in the city's selective-enrollment schools. CPS has received 30,608 applications for 4,200 seats next year. The sharpest increase came in elementary-school programs, where 12,445 students are chasing 1,200 spots.
"The competition has really gone up," says Christine Virgen, a North Side resident whose daughter is waiting to hear whether she'll be accepted into one of the city's selective-enrollment academic centers for seventh- and eighth-graders. "After seeing what's happened with high-school kids who didn't get into their first, second or third choice, we're worried."
Ms. Virgen was one of 39 parents at a recent seminar held at Sulzer Regional Library in Lincoln Square by Chicago School GPS, a consulting firm launched by three North Side moms to help parents navigate Chicago's public and private schools.
Such knowledge is in higher demand than ever. Neighborhood Parents Network, which helps about 5,400 families meet the challenges of parenting in the city, says it now holds eight seminars a year about choosing public or private schools. It used to offer three.
"They fill up in about an hour," says Sarah Cobb, executive director of the 32-year-old nonprofit.
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School SCORES HEAD NORTH
'Huge impact,' dramatic results when parents get involvedA decade ago, Elementary School struggled to get the middle-class parents who were buying condos and townhouses in the area to send their kids to the school.
When they did, the results were dramatic. In 2002, just 33 percent of students were passing the state achievement tests. Within three years, it was 80 percent, eventually rising to 95 percent.
The experience at School shows how Chicago Public Schools might capitalize on the slowdown in people heading to collar counties.
"We've had a huge impact from people moving here and staying," says Tara Shelton, who joined the staff in 2004 and became principal five years ago. "Parents treat us like a suburban school with that mentality that they have to volunteer or support it financially if they want great programs."
John Jacoby says Chicago Public Schools needs to follow its success in winning over parents of School Elementary students by adding a neighborhood high school.
The school, near Roosevelt Road and State Street, opened in 1988 and was a chronic underperformer. It was reorganized in 2002 at a time when test scores were becoming an issue in the wake of the federal No Child Left Behind Act's focus on standardized tests. New administrators arrived, and attendance boundaries were redrawn to encompass more of the School neighborhood, one of the city's hot real estate markets for young professionals. Programs were launched to attract gifted students.
John Jacoby, an attorney at Nyhan Bambrick Kinzie & Lowry P.C. in Chicago, had considered moving to the suburbs but stayed when his daughter Renee was accepted into School's gifted program as a kindergartner in 2002.
He quickly became involved, winning election to the Local School Council — which oversees the school's budget and achievement plans — and heading fundraising for nonprofit Friends of School.
He sent letters to parents asking for monthly donations of any amount. "Everyone here is getting a private-school education for free," he recalls telling others. "I want $1,000 per family. You can do it $100 a month if you want, but you should do it."
Since then, the school's big yearly fundraiser has graduated from a beans-and-hot dogs potluck in the gym that raised $2,000 to a recent black-tie gala at the Blackstone Hotel that raised about $50,000.
Such nonprofits have become a key resource that allows schools in Chicago's middle-class neighborhoods to thrive while living within CPS budget constraints. Funds have been used for everything from hiring teachers to buying iPads for classrooms.
"It starts small," Mr. Jacoby, 54, says. "But if you get a core group of 20 good parents, you can turn around a school." He and others who took a chance on School now are looking to CPS for a new neighborhood high school.
"If we don't service these families, at the earliest opportunity, they will leave the city and go elsewhere," says Alderman Robert Fioretti, whose 2nd Ward includes School Elementary.
To be sure, School benefited from a shift in boundaries that ended busing from a nearby housing project that later was demolished. Half the students are African-American, and 9 percent are Hispanic. (Overall, CPS is 42 percent black and 44 percent Hispanic.) The percentage of low-income students dropped from 91 percent to 37 percent in three years. But test scores improved across the board even before the new, affluent students had taken the tests, Mr. Jacoby says.
School initially used a lottery-based magnet program and regional gifted program to attract students. Those programs are going away as more neighborhood kids have filled the 800-student school.
"It's almost too successful," says Tim Easton, whose 8-year-old daughter, Giulia, is a third-grader. "Overcrowding is becoming an issue now."
Magnet and selective-enrollment programs inside highly regarded neighborhood schools, such as North Center's Bell, Nettelhorst and Burley or Blaine in Lakeview, are among the most desirable options for many families looking to stay in the city.
"We started to look at the suburbs, but we stopped when (our two daughters) got in at Bell," a North Side school which has a well-regarded gifted program, says Grace Sawin, a co-founder of Chicago School GPS.
The popularity of such schools and the intense competition for elite high schools such as Northside College Prep and Walter Payton College Prep has produced a ripple effect elsewhere.
Parents are flocking to alternative programs such as International Baccalaureate that are exclusive but aren't based on test scores.
Taft High School on the Northwest Side had nearly 2,800 applications to its IB program, up from about 1,200 last year, Principal Arthur Tarvardian says.
Even neighborhood schools are more difficult to get into, especially for those living outside boundaries. School Elementary is phasing out its regional gifted program. Some schools no longer allow automatic admission into neighborhood kindergartens to out-of-boundary students who are in tuition-based preschool.
The competition is frustrating for parents, but "it's a real opportunity for CPS," says Tim Shanahan, chairman of the Department of Curriculum and Instruction at the University of Illinois at Chicago. "Schools with high mobility have lower achievement. It changes things for everybody if you're not just passing through.
"If the economy makes parents stay, and you do a good job with the schools, you can keep them. If they get frustrated, in a couple years, when the economy is doing better, they still flee. In that case, all you're seeing is an interruption in the pattern."
It's an open question whether City Hall is up to the challenge or whether this will be a squandered opportunity.
Barbara Radner, director of the Polk Bros. Foundation for Urban Education at DePaul University, notes that improvement at CPS has been elusive. "They don't have much" of a track record, she says. "Rahm's got a harder problem than Daley did because he doesn't have any money. But he's relentless, and he's made tough choices already. I've got confidence he can make things happen."
For one thing, it's unclear whether the model of activist, fundraising parents can work in poorer neighborhoods.
"In the schools where (the transition is) under way, parents can afford this indirect tax," says Mr. Pawar, the North Side alderman. "In areas where families don't have the resources to give, they're going to continue to have the same problems. . . .The issue no one talks about is there are 400,000 kids in CPS, and 86 percent come from low-income families."
Also uncertain is how long Mr. Emanuel's opportunity will last.
"I think after the recession ends, migration picks up again, but it won't be as exuberant as it was the previous decade," says Ken Johnson, a demographer at the University of New Hampshire who spent several years at Loyola University Chicago. "This is an advantage for the city right now."