When I was In New York City public grade school (~1992/3) there was a similar system. It added the so called "top" classes for higher ability students and special education classes for lower ability students. These students were called "tops" and "speds" respectively with sped being a pejorative term. All that system did was pile every student with behavioral problems in special ed and all the kids who parents were on the school board in tops classes. Everyone else just went to class.