Ravenswood family’s move to Evanston shows why Chicago had better grow its middle class
Raising taxes while cutting back on what people get for their money is a sure way to get them to bail, City at the Crossroads columnist Ed Zotti writes.
Wendy F., a middle-class parent of two school-age children, thought she’d always live in Chicago. Three things made her change her mind.
First, then-Mayor Rahm Emanuel announced a record property tax increase to put toward the city’s pension costs. Then, Cook County notified her of a sharp increase in the assessed value of her home, which she and her husband calculated would increase their property tax bill by 45%.
Finally, the Chicago Public Schools announced another round of budget cuts, and Barbara Byrd-Bennett pleaded guilty to corruption charges and resigned as CPS’ CEO.
The prospect of a big property tax hike plus the turmoil at CPS led the couple to sell their North Side home and move to Evanston.
“It wasn’t so much the amount,” Wendy says of the tax increase. “We were happy to pay our fair share. But a 45% increase in taxes that were already high when our schools were going to get less — after years of being cut to the bone — made us realize the value wasn’t there for us.”
What makes the family’s departure especially painful to anyone concerned about Chicago is that Wendy was one of the prime movers behind a successful effort to improve Ravenswood Elementary School, the public school her children attended before moving to Evanston.
In 2005, she was one of the co-founders of Friends of Ravenswood School. For 10 years, she and other FORS members had met with school staff and local leaders, organized fundraisers and events, gave tours, served as room parents and promoted the school to families.
Today, Ravenswood has a performance rating of “1+” — the highest in CPS’ evaluation system. Real estate listings for nearby homes cite being “within Ravenswood attendance boundaries” as a selling point. One couple recently pulled their kids out of a top private school to send them to Ravenswood.
Wendy also got involved in a similar effort at Amundsen High School, for which Ravenswood is a feeder school. But that was cut short by the move to Evanston.
“We didn’t move up here to get away from our neighborhood schools,” she says. “We had a great experience at Ravenswood and were excited about Amundsen. But things got to be too much. We numbed ourselves into accepting things that shouldn’t be acceptable.”
She cites the disparity in resources available to the handful of elite CPS schools, compared to neighborhood schools. In contrast, she says, “Evanston’s resources are amazing and available to every kid, including the ones who get Bs and Cs — not just the ones who get into the selective enrollment schools.”
A gut punch, she says, was a comment from her seventh-grader on arriving home from his new school in Evanston.
“There’s a library inside my school, and somebody works there,” he said. “Isn’t that weird?”
At Ravenswood, the school librarian’s position had been eliminated due to budget cuts.
“No, buddy,” Wendy told her son, “that’s normal. What you had was weird.”
Her story illustrates the danger Chicago faces. The city’s resurgence over the past four decades is largely due to the growth of its college-educated middle class — people like Wendy who have invested time and resources in the city.
In 1980, just 17% of Chicagoans lived in what I’ll call HEMI-plus neighborhoods — high education, middle income or better (see accompanying graphic).
In 2017, the latest year for which data is available, 40% did.
There’s no guarantee that number will continue to rise and a number of reasons to think it won’t. Rising property taxes and dissatisfaction with schools are just two among multiple headwinds.
In many HEMI-plus neighborhoods, housing costs have risen so much that only the wealthy can afford to live there. In the African American community, middle-class families are leaving to seek more opportunities and a better quality of life.
Chicago’s college-educated middle class has continued to grow. But the rate is slowing.
In part, that’s a matter of demographics. Many of the college grads who’ve helped rebuild Chicago and other big cities are millennials, born between 1981 and 1996. The oldest members of this group are in their mid-30s — prime child-rearing years. Inevitably, some are moving to the suburbs looking for more space and better schools.
Others are choosing to stay. But they could change their minds if the costs of living in the city, financial and otherwise, become too steep.
Therein lies the danger not just for the city but also for the rest of the state. The financial stability of Illinois hinges in large part on the continued growth of Chicago’s middle class.
Illinois’s massive pension liabilities already consume a quarter of the state budget and will rise by hundreds of millions of dollars a year for decades. The only thing that — on paper — stands between Illinois and insolvency is the assumption that the state’s economy, and thus its tax yield, will keep growing.
And the main driver of economic growth is the city of Chicago:
- Downtown Chicago gained 7,000 jobs last year — fewer than in previous years but more than the rest of the six-county metro area, which suffered a net loss of jobs.
- Aaggregate household income in Chicago is rising faster than in the United States overall and the rest of the region and the state. In 2000, the city accounted for 46% of the income in Cook County. Now, it’s 52%.
- The value of real estate in Chicago tripled between 1995 and 2017, a much larger increase than for the rest of Cook County, according to data from the Civic Federation. In 1995, Chicago contributed just 40% of the property taxes collected in the county. Today, it’s 52%.
With the graduated income tax and stiff property taxes arising from high home values in HEMI-plus neighborhoods, Chicago’s middle class unavoidably is going to bear an increasing share of the state’s tax burden.
They can handle it — to a point. But Wendy’s observation about value is worth keeping in mind. Raising taxes while cutting back on what people get for their money is a sure way to get them to bail.
Sure, they’ll still pay taxes if they relocate to the suburbs. But the real damage will be to the city’s role as a talent magnet. If Chicago stagnates, it’ll draw fewer college graduates from throughout the central United States, and the state’s growth rate, already anemic, will decline even further.
Families leave Chicago for a variety of reasons. No one policy prescription is going to persuade all of them to stay.
But some basic issues need to be addressed.
Illinois’s over-reliance on property taxes to fund basic services should be rethought.
The middle class doesn’t require subsidies, but ways to keep housing affordable without imposing onerous restrictions need to be found.
Crucially, Chicago somehow needs to attract rather than repel black college graduates.
You can’t fault Wendy. She did what she could.
“There are things we miss about the old neighborhood,” she says. “But we’re only seven miles north. This has been a good move for us.”
This is part of the ongoing series City at the Crossroads by journalist Ed Zotti on trends affecting Chicago and choices the city faces.
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