Ah, New Jersey. As it happens I am somewhat familiar with that system, partly because I am currently sitting within sight of the Delaware Memorial Bridge, and partly because I have two acquaintances who are long time career teachers in that system. It’s really not bad compared to the rest of the US - but that’s a low bar.
It is ostensibly selecting by income, because as you said it’s test-in. And that’s what the tests are measuring, as shown in the graph I already posted. Not by class, by parental income.
And moreover, New Jersey’s system is corrupt. Leaving aside the abundantly documented malfeasance under Christie, one of the two teachers I know in that system got to teach in a better school because his parents are personal friends with highly placed politicians. (Including Christie and Whitman - he brags about this, he’s a piece of work. I don’t know why accomplished, intelligent women like his wife so often marry truly awful men.) His social set routinely gets their children into whatever school they want, regardless of test scores - and even when recommendations aren’t official, if people high in the state government call, principals listen. Or they are punished.
The other teacher I know in NJ is a good friend, our families spend much time together. She used to be a librarian before New Jersey took the librarians out of most of the schools the less affluent children attend. She’s one of the good ones, you’re lucky to have her. Since both of my sisters are career teachers (one in England, one in Maryland) we often talk about this sort of thing.
Well, right there’s a good start! But we have to be cognizant of the fact that schools profit financially from the affluence of parents. Magnet schools have more parent involvement which means more off-the-books spending - like for field hockey sticks, library books, teacher assistance from the PSA/PTA and private individuals (I’ve personally pumped tens of thousands of dollars worth of computer monitors into the local schools - which is completely off budget of course). Magnet school parents are more likely to have cars which means more input from parents to school administration which means better schools. It’s very simple - more monied parents means school funding isn’t really equitable at ground zero of teaching.
I wasn’t familiar enough with it to recognize the name but Wikipedia helped. Here on the other side of the river we have Murry Schwartz’s 1976 decision more in our minds. I believe what you are saying here supports what I’m saying - just throwing money at a ghetto school, while taking out all the highest performing students and sending them to magnet and charter schools, isn’t going to work, it’s self-sabotaging.
And here you’ve written a very great truth - we have no perfect solution. But the economic discrimination that New Jersey (and also my home state of Delaware) is pursuing is not only not a solution, it’s making things worse.
For my part, I adopted a child from the inner city. Which lets me refute the claims of people who say nothing can be done, certainly, but it doesn’t do anything to reform the system at all. 
