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I don't believe that's true.
Maybe it's true in American private schools where you need to chose which school to give money to, but where I live schools don't have reputation to care about. You just go to the one closest.
I was expelled for being bullied for being queer
Clearly it's your fault for being bullied.
Did you read my comment? I am not claming that bullying does not exist.
You are talking about only private schools being the exception from this but the public school I went to doesn't fit your belief.
Happens in public schools where funds get cut for poor performance of students.
In my central European country, performance tracking is centralised and operated by the State, and does not affect funding.