a Better Bubble™
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This summer, worried parents called the principal at Chalmers Elementary on Chicago’s West Side to ask if the district had shuttered the school. They had noticed second-floor windows boarded up.
But despite years of declining enrollment, the school wasn’t closing. It was undergoing major renovations.
Students returning to Chalmers last month found an expansive new engineering space, computer lab and arts studio. The teachers who greeted them had received special training. A cache of new technology — 3D printers, computers and bee-shaped robots to teach students basic coding — offered fresh possibilities.
The influx of dollars and attention has lifted hopes at Chalmers, with officials at Chicago Public Schools and City Hall testing the idea that investing in high-poverty schools can reverse enrollment losses.
But it could take years and millions of dollars to see if it works.
Chalmers, in the historic North Lawndale neighborhood, served about 210 students last year in a building with capacity for 600. Just around the corner, about 210 students populated Johnson Elementary on a campus meant for 480. The local high school, Collins Academy, was down to 200 students. The schools serve mostly Black and low-income students.
The enrollment slide at the three schools and others in the area was partly the result of decisions by previous mayors and public school administrations who labeled North Lawndale’s schools as failing and opened new ones — many run by private entities — that drew families away. About a decade ago, the district closed and overhauled Collins and fired educators at Chalmers and Johnson who had built relationships with families and temporarily handed the schools over to a private operator to try to turn them around academically.
All the while, families have been leaving the neighborhood or having fewer babies, creating demographic challenges outside school officials’ control. Across the district, overall enrollment dropped by 70,000 in the past decade. That decline meant some schools in North Lawndale and elsewhere became tiny, costly to run and unable to offer a rich student experience.
Three of every 10 Chicago schools sit at least half-empty, and closing or merging them remains a political third rail. Chicago officials, faced with pressure from the teachers union and community groups, have not confronted this challenge. And, as Chalkbeat and ProPublica reported in June, for years the district has largely left chronically underenrolled schools to struggle.
Now, CPS and the city — under new leadership — are backing a different, community-led approach: spending at least $40 million to transform Chalmers, Johnson and Collins into science, technology, engineering, art and math, or STEAM, academies. The money is covering building upgrades, professional development, new educator positions and technology in the initiative’s first two years.
After years spent promoting better-resourced selective and magnet schools and opening up charters en masse, CPS is hoping to draw families back to the neighborhood schools that many of them abandoned.
The district has held up the North Lawndale initiative as an example of working closely with local communities to find solutions to under-enrollment — and as a model for other Chicago neighborhoods that have experienced disinvestment and student losses.
“When we are successful in having high-quality programs, what we know from history is that more children will want to come,” former CEO Pedro Martinez said at a press event at Collins last school year.
Education experts say the North Lawndale experiment is promising, and locally, the project has drawn a lot of cheerleaders, roughly $1 million in philanthropic backing and no vocal opposition. But solving the city’s enrollment challenge by trying to attract families to neighborhood schools is a daunting and uncertain task. New science and technology programs the district launched in other neighborhoods in recent years have not always brought a surge of students.
Chicago still maintains a robust system of school choice, and the school-age population continues to shrink. Without an influx of new students from outside of North Lawndale, growing the three schools could mean siphoning students from other schools with their own enrollment woes.
Preliminary data a few weeks into the school year shows flat enrollment, but the project’s supporters say word about it is just getting out. A key challenge is ensuring the cash-strapped district keeps funding the new positions, staff training and facility upgrades after money for the first two years runs out.
Ralph Martire, the executive director of the Center for Tax and Budget Accountability, which has criticized the district’s spending in the past, says it’s tough to argue against programs that could boost student outcomes in high-poverty schools.
“There’s never a good reason not to invest in the education of kids who’ve been traditionally underserved,” he said. “The impact on enrollment — that’s really hard to predict. I don’t know that we have the data to give a definitive answer.”
In any case, given that the initiative took seven years to launch and that it came with a high price tag, it’s likely not a solution the Chicago school district can readily replicate in other neighborhoods grappling with underenrollment.
“The question is how the district is supporting innovative models at scale, not how they’re supporting one-off alternatives alone,” said Carrie Hahnel, a school finance researcher with the nonprofit Bellwether.
“Districts are trying all kinds of things — work-based learning, dual enrollment, themed academies, small schools within schools — and yet we still see these declines,” Hahnel said. “The education sector is really struggling right now to figure out what it takes to attract families.”
Chalmers is one of three Chicago Public Schools in North Lawndale shifting to STEAM programming, which adds the arts and social studies to the traditional STEM focus of science, technology, engineering and math. (Jamie Kelter Davis for ProPublica) How Past Policies Drove Students AwayIn the name of school reform in the 2000s, Chicago officials under Mayor Richard M. Daley and later Mayor Rahm Emanuel enacted a series of policies that contributed to the shrinking of neighborhood schools, like those in North Lawndale.
After the federal No Child Left Behind Act passed in 2001 and schools in some high-poverty areas did not perform well on annual standardized tests, many were labeled failing and in need of drastic reforms. Chicago’s schools CEO at the time, Arne Duncan — who under President Barack Obama led the U.S. Department of Education — embraced opening independently operated, publicly funded charter schools.
His administration maintained that was the fastest way to give vulnerable students a better experience and spur traditional public campuses to improve. In North Lawndale, families eager for higher-performing, better-resourced options have embraced the new schools — or sent their children to CPS magnet or selective enrollment schools farther from home.
In the 2005-06 school year, there were about 5,000 students living within the boundaries of North Lawndale’s 12 schools, and about 70% went to their assigned neighborhood school, according to a ProPublica-Chalkbeat analysis of district data. There were three charter schools open in the neighborhood.
The most recent data, from last school year, shows there are roughly 4,000 students living within the boundaries of the 10 remaining neighborhood schools in North Lawndale, but only about 30% attend their assigned school. Meanwhile, the neighborhood is now home to seven charter schools — among the highest concentration of them in Chicago — and they enroll 2,800 students.
Duncan declined to speak with ProPublica and Chalkbeat about Chicago’s enrollment troubles.
Betty Allen-Green, a retired Chicago principal, watched all of this happening and said she grew alarmed by the emptying out of the neighborhood’s public schools and outraged by the dearth of specialized programs they offered.
By 2018, Allen-Green and a small group of other longtime North Lawndale residents and former educators had tackled an ambitious goal: give local families a high-quality neighborhood school they’d be eager to choose. Among these advocates was Areulia Davis, whose kindergarten class had met on the auditorium stage in an overcrowded Pope elementary in the 1960s. In 2013, she’d seen a diminished Pope become one of 50 campuses shuttered in the country’s largest mass school closures.
The group felt their mission was key to a broader Quality of Life Plan that North Lawndale leaders unveiled in 2018, which also included goals to increase affordable housing, improve safety and create more jobs.
“We wanted to bring the children of North Lawndale back to the schools of North Lawndale,” Allen-Green said.
Betty Allen-Green, a retired Chicago principal, has worked to revitalize schools in North Lawndale and pushed for the STEAM program. (Jamie Kelter Davis for ProPublica)Allen-Green and the other former educators pitched a plan to build a new state-of-the-art STEAM school. They say district officials urged them to include the consolidation of three underenrolled schools alongside the proposed $65 million construction project. The idea echoed what the district had just done in Englewood on the South Side at the time: closing several small high schools and replacing them with a state-of-the-art high school focused on science and technology.
The North Lawndale group lined up almost two dozen high-profile partners, from the city’s science museum to universities, to help with teacher training, field trips and other services.
But their plan met with intense opposition from the Chicago Teachers Union and families at the three schools that would be targeted for closure. Shuttering schools would be especially disruptive to families amid the pandemic, and especially painful in a neighborhood still reeling from earlier closures, the union said.
Allen-Green countered that she and other project backers had been on the front lines of opposing school closures in 2013. But, she argued, with unabated enrollment losses in the following years, it made sense to combine the resources of several tiny schools.
Still, Allen-Green’s group backed off and began formulating other plans without any closures. One finally stuck: give three existing schools — Johnson, Chalmers and Collins — a STEAM makeover.
Mayor Brandon Johnson, a former teachers union employee and staunch opponent of closures who has promised to improve housing and draw families to places like North Lawndale, became a proponent once he took office. (Johnson’s office did not respond to requests for comment about Chicago’s efforts to address small schools.)
By 2024, City Hall pitched in $10 million toward the $41 million project from a city pool of tax dollars for economic development.
And when Johnson selected where he’d ring the bell to mark the first day of school, the mayor chose Chalmers in North Lawndale.
Chalmers Principal Romian Crockett said families are excited about the STEAM revamp. (Jamie Kelter Davis for ProPublica) Doing “Right by the Kids We’ve Already Got”Like other parents dropping off their children at Chalmers on the first day of school in August, Angela Dixon said she knew little about the school’s transformation into a STEAM campus. She likes the school because of its proximity to her home and the supportive small school feel, which has helped her third grade son thrive.
School leaders on the STEAM campuses say the overhaul, including a more student-led approach to teaching, is already generating positive buzz. Chalmers Principal Romian Crockett says he’d like to see more students enroll, especially in the early grades. Still, Crockett, who gives himself two days at the start of the year to learn each student’s name, thinks the project will help even if it doesn’t significantly boost enrollment.
“I don’t quantify achievement by the number of bodies,” he said. “I want to do right by the kids we’ve already got.”
But for Allen-Green and other community members supporting the project, a major preoccupation this year remains selling the three schools to more families in the neighborhood. They are pushing the district to hang new banners promoting the campuses, polish their websites and pay for new school marquees.
They hope Johnson and Chalmers will draw some students from outside the neighborhood. District officials say they’ll be leaning on the three schools’ principals to drive these marketing efforts.
But across the city, efforts to bolster neighborhood schools have run headlong into trends and attitudes unleashed by the district itself when it endorsed magnets, selectives and charters as stronger options.
First image: A view of the skyline from a classroom at Johnson Elementary. Second image: Students wait in line to enter a classroom at Johnson. (Taylor Glascock for ProPublica)In December 2023, the school board passed a resolution vowing to rethink school choice and prioritize neighborhood schools, nodding to their role as vital community hubs. It drew pushback and alarm, including from Black and Latino families on the district’s South and West sides wary of CPS limiting their options. The district backed off from any moves that might be seen as undermining its magnet or selective enrollment programs. Still, the district’s new five-year strategic plan includes a goal to “increase the percentage of students attending schools within their neighborhood or community area.”
Some areas with underenrolled schools still have robust numbers of CPS students living in them. Martinez has held up the neighborhood of Austin as an example of an area that has enough students to fill bustling campuses, but many families instead choose schools elsewhere.
“If every student went to school in Austin that lives there, we’d be overcrowded,” he said at a City Club Chicago speech in June. (Martinez was fired after a clash with the mayor over the district’s budget.)
More than 1,500 potential students live within the boundaries of Austin’s local high school, but only 114 enrolled last year.
An experiment in Englewood on the city’s South Side, where population was dropping, sought to create an attractive new neighborhood high school while closing four small ones. The district built an $85 million modern STEM high school, and enrollment grew initially. But last year it slipped to about 630 from its peak of about 830 three years earlier. It had an attendance rate of roughly 65% and a graduation rate of about 62% for the 2023-24 school year, both significantly below the district average.
Mistrust of neighborhood schools can run deep, said Blaire Flowers, a West Side mother of five. Families remain wary of high educator turnover, few engaging programs and lackluster graduation and other student metrics — or they simply want the rich course offerings and extracurricular activities of schools elsewhere. After her own negative experiences as a student in the neighborhood, she has largely chosen North Lawndale charter schools for her children over the years.
She thinks the STEAM initiative could be a game changer for local schools: “Right now there are no programs in these high schools and elementaries that make students want to go there.”
But Flowers said she and other parents will wait for solid evidence that the makeovers are paying off in stronger student outcomes before considering these schools.
Corey Morrison, executive director of the district’s STEM Department, said CPS has brought coveted programs to dozens of its neighborhood schools in recent years. Some, like Peck Elementary on the city’s Southwest Side, have earned recognition as exemplary STEM schools. But they haven’t shifted the demographic trajectories of their neighborhoods.
Still, Morrison is hopeful about the prospects in North Lawndale.
“I just don’t see how this doesn’t draw the community because it came from the community,” he said. “They’re telling us what they need and want, and we’re designing the very best version of that we can provide.”
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Last month, when President Donald Trump signed an executive order “guaranteeing fair banking for all Americans,” he served notice of a coming federal crackdown.
Banks who have denied customers access to accounts, loans or credit cards “on the basis of political or religious beliefs or lawful business activities,” he said, would now feel the full force of government regulators. Violators could find themselves facing fines, consent decrees or “other disciplinary measures” in an effort to stamp out “politicized or unlawful debanking.”
The cause hits close to home for the president, whose family business sued Capital One earlier this year, alleging, without providing evidence, that hundreds of its accounts were closed in the summer of 2021 “as a result of political discrimination.”
Even so, the administration may find it difficult to enforce the president’s order for one simple reason: Seven months of aggressive cost-cutting and government downsizing has left the Consumer Financial Protection Bureau, one of the primary regulators that Trump tasked with carrying out his banking directive, a shell of an agency.
In fact, CFPB leaders appointed by the president are awaiting final court approval to fire the majority of the bureau’s remaining staffers, a move that would leave just a skeleton crew in place and likely end dozens of investigations into alleged corporate malfeasance. Since February, most staffers have been under a stop-work order that has effectively stalled the bulk of its probes — including ones into debanking.
Among them are investigations into why JPMorgan Chase and Citibank freeze and close bank accounts, respectively, according to people familiar with the matters. Work was also suspended on inquiries into whether two little-known companies that banks use to screen prospective customers have wrongly flagged some as too risky to serve, said the people, who spoke on condition of anonymity because they were not authorized to discuss sensitive matters.
Court records show that one of those firms, Regulatory DataCorp, provides reports on customers to Capital One — the very financial institution that Trump’s family business has accused of debanking. (A Capital One spokesperson declined to comment, but the bank has disputed the Trump business’s claims of political discrimination and moved to dismiss its lawsuit, writing in court papers that it was “false” that the bank closed Trump accounts because it disagreed with the president’s views.)
In dismantling the CFPB, the Trump administration has portrayed the agency as an industry antagonist and an example of government overreach. But Luke Herrine, a consumer law expert at the University of Alabama School of Law, said that Trump officials, in their haste to shrink the federal bureaucracy, “didn’t really consider whether there were some aspects of the CFPB that might be useful for their projects and what they might have to do to preserve them.”
In fact, days before he was sacked by the Trump administration, then-CFPB head Rohit Chopra told a gathering of the conservative Federalist Society that the government needed to do more on debanking and advocated for due process rights for customers as well as more “real, clear, bright-line prohibitions” on what information banks can use in deciding to freeze or close accounts.
The White House did not respond to a request for comment.
To be sure, Trump’s executive order directs a host of regulatory agencies to take action, and some of them, such as the Federal Deposit Insurance Corporation and Office of the Comptroller of the Currency, have already begun making changes to their bank examination processes to address the president’s concerns. But the CFPB is the only one that is specifically charged with protecting consumers, hundreds of whom file complaints each month alleging they’ve been denied access to the financial system.
A spokesperson for the CFPB didn’t respond to an email and call seeking comment. But a recent decision by the agency sheds some light on how bureau officials may be interpreting Trump’s order.
Last month, the CFPB cited the order as it dropped a Biden-era probe into a company that provided loans for customers to buy firearms and pets, saying the investigation was politically motivated; the services were marketed to conservatives and Donald Trump Jr. was a board member of the firm’s parent company. Though the company had previously reached deals with regulators in California and Massachusetts over its lending practices, the CFPB’s chief legal officer wrote in a recent letter that the case “represents precisely the kind of unconstitutional targeting” barred by Trump’s debanking directive.
Banks make decisions about who to serve based on a number of factors, including the financial and reputational risks of doing business. They also must follow laws and rules requiring them to know their customers and prevent money laundering.
But leaders in both political parties agree that Americans are sometimes unfairly denied credit or accounts by big financial institutions. The issue became something of a cause celebre in Republican circles after former President Barack Obama’s Department of Justice launched a crackdown on unscrupulous payday lenders and other high-risk businesses, in part by urging the payment processors and banks that provide those enterprises access to the financial system to be more diligent in looking for signs of fraud.
The former president of the American Bankers Association asserted that the program was “compelling banks to deny service to unpopular but perfectly legal industries by threatening penalties,” a message that Republicans amplified as an example of Obama-era government overreach. Their argument gained steam when the firearms industry discovered its retailers had been listed as a high-risk merchant in an obscure FDIC newsletter, according to Dru Stevenson, a professor at South Texas College of Law Houston, who has written that the whole affair has taken on “symbolic and mythic proportions in partisan discourse about regulation.”
Many conservative activists and party leaders now claim that some Republicans are being rejected as customers because of their politics — and even at the behest of government regulators. No evidence has emerged to support the claim and indeed, as Reuters recently reported, just 35 of the 8,361 detailed complaints filed with the CFPB about closed bank accounts since 2012 included terms such as “politics,” “conservative” or “Christian.”
Complaints of discrimination are also increasingly leveled by cryptocurrency entrepreneurs, many of whom backed Trump’s presidential campaign. Their narrative gained traction in 2023 when regulators warned banks about the risks associated with digital assets, an act some in the crypto industry billed as a revival of the Obama-era crackdown.
Getting a sense of the scope of debanking was in part what the CFPB was exploring in its inquiries when Trump took office in January, the people familiar with them said. At JPMorgan, for example, about a million customers’ accounts are frozen each year, they said, though the justification for doing so varies and in many cases it’s done in response to fraud.
The CFPB investigations into Regulatory DataCorp and another screening company, LSEG World-Check, were looking in part into whether customers had been denied accounts or had seen their accounts closed after the companies wrongly flagged them as problematic, generating false positives or outright mistakes in dossiers compiled by analyzing vast news and public records databases, the people said.
The CFPB had issued subpoenas in its inquiries, which were still in the early stages, said the people familiar with the probes.
A company spokesperson for World-Check said “we have not understood World Check to be under review by any agency for potential denial of credit.” A spokesperson for Moody’s, which acquired Regulatory DataCorp in 2020, didn’t return a call and email.
A JPMorgan spokesperson said the bank wasn’t aware “of the CFPB investigating so-called politicized debanking, as it is discussed in the recent Executive Order” and Citibank declined to comment. In a statement released after Trump issued his executive order, a coalition of bank industry groups said the directive would “ensure all consumers and businesses are treated fairly, a goal the nation’s banks share with the Administration” but one that hasn’t been met because “regulatory overreach, supervisory discretion and a maze of obscure rules have stood in the way.”
Part of the problem is that the whole debanking process is cloaked in secrecy, since financial institutions are subject to a constellation of regulations and laws — including one called the Bank Secrecy Act — that require them to refer potentially suspicious activity to the Treasury Department in confidential reports they can’t talk about. That can be frustrating for customers who are not told why they’re being cut off — and it provides an opportunity for outsiders to offer their own conclusions, experts said.
What’s more, international best practices counsel financial institutions to give people in high-profile positions, who are called “politically exposed persons,” along with their immediate family members and associates, an extra due-diligence scrub since they are deemed more susceptible to bribery or corruption.
A 2023 New York Times series exploring debanking documented various instances in which banks flagged what turned out to be benign transactions as unusual, freezing accounts for fear of not complying with various rules that bar financial institutions from facilitating money laundering, terrorism or fraud.
Banks have expressed a desire for more clarity from their regulators on when they should boot customers and whether they can provide more information about the reasoning behind their decision.
As it stands, banks tell affected customers little to nothing. In that vacuum, Republicans have often ascribed political bias as the motivation without providing concrete evidence to back it up, said Stevenson, the debanking expert.
Ironically, the Trump administration quashed an effort that could have shed more light on debanking when it abandoned a legal case earlier this year.
Under former President Joe Biden, the CFPB had sought to amend its exam manual to give its bank examiners more leeway to scrutinize financial institutions for potentially discriminatory practices, court records show. The Chamber of Commerce and other industry groups sued and a district court blocked the agency from doing so, arguing the bureau had exceeded its authority. The Biden-era CFPB appealed that ruling, but the Trump administration dropped the case before it was decided.
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