WashACE Blog

School Funding Decision Prompts Reform Proposal

Judge Erlick's ruling that the state was not living up to its responsibility to fully fund basic education prompted Sen. Joe Zarelli, R-Ridgefield, to release another Budget Tidbit. Yesterday, Zarelli suggested significant changes in the way the state funds the public schools.

Here's how he describes the proposal:

In a combination of two steps, a portion of the current school district local levy is converted into a state property tax....Specifically, SB 6858 reduces all school districts' local levy authority by 12% and increases the state property tax levy by an equivalent amount.  Most districts have a 24% levy lid, so this functionally removes half of their levy authority.  However, the state property tax levy is increased by 88 cents in 2011, generating an estimated $828 million a year – although, as noted above, local levy authority is reduced by anequivalent amount.  Proceeds from the state levy are dedicated to the support of common schools.

I've not seen an independent review of the proposal and it's unlikely that anything will come of it this session. These effects are calculated by Zarelli:

School Districts 

o Almost 2/3rds of school districts receive more funds under this approach.   Overall,

there are 196 school districts estimated to receive more funding.  
 
o The other 1/3rd are held harmless via state appropriations.  This is estimated to cost about $84 million in the first year.   

  Impact to Taxpayers
 
o  A majority of school district taxpayers will pay less in property taxes.  The estimate is
that taxpayers in 156 school districts will pay less.

 These districts representing 661,680 pupils (or 67% of pupils in state).

 o It is estimated that taxpayers in 139 school districts will pay more.  These mainly
comprise two groups:

 Property-wealthy districts.  By shifting from a local financing model where they finance services at a low millage rate, these districts end up paying higher taxes when a uniform statewide rate is assessed. 

Districts with less than a 12% levy.  If a district imposes less than a 12% levy,

the reduction of a district's levy authority by 12% does not benefit taxpayers. These taxpayers consequently pay more if the 88-cent state levy is imposed. 

Like most things legislative, then, there are winners and losers. Congratulations to Zarelli for coming up with a quick and thoughtful response to a court ruling that will likely shape the debate over the next several legislative sessions.

Coverage of the proposal on the TVW blog here.

Caseload Forecast Increases Cost Estimate by $96 Million

Today's release from the state caseload forecast council  takes the projected state budget deficit up, from $2.6 billion to $2.7 billion. At least, that's the number we'll be using for a couple of days, until the state revenue forecast is released Friday.

In the Seattle Times, Jim Brunner notes that the change is relatively minor in the overall fiscal picture. 

...this isn't really a game changer for the Legislature. The extra $96 million is relatively paltry in the grand scheme of state's $32 billion general-fund budget.

Most of the increase is in K-12 education costs, reflecting that the teacher mix tilts toward older (costlier) teachers as younger staff have been the first cut as schools trim employment.

School Funding Decision Changes Budget Debate

But probably not this year. King County Superior Court Judge John Erlick's long (103 pages) analysis concluded that the state was not living up to its constitutional obligation to fund fully basic education. Here's the crux:

State funding is not ample, it is not stable, and it is not dependable.  Local school districts continue to rely on local levies and other non-State resources to supplement state funding for a basic program of education.  Recent legislation addresses, but does not resolve, the perennial underfunding of basic education.  Accordingly, the State is directed to determine the cost of amply providing for basic education and a basic program of education for all children resident in the State of Washington.  The State must also comply with the Constitutional mandate to provide stable and dependable funding for such costs of basic education. 

He concludes with this:

The means of fulfilling this Constitutional mandate properly fall within the prerogative of the Legislature.

What that means exactly, I don't know. Erlick chose the Potter Stewart standard when it came to defining "ample." Or maybe an inverted Potter Stewart, more along the lines of "I know it when I don't see it." No one seems particularly surprised by the finding. The question now is whether or not it will be appealed to the state Supreme Court, which has seen more than its share of school funding cases over time.

Linda Shaw's Seattle Times reporting provides more context. 

"He left the remedy for whatever ails the system in the Legislature's hands, and we believe that's where it belongs," said Assistant Attorney General Bill Clark.

Clark also said it appears that the judge would allow the state to fulfill his order by carrying out plans in a bill passed last year — House Bill 2261 — which set 2018 as a deadline for a number of changes in how the state funds it schools. The bill also expanded the state's definition of what constitutes a "basic" education.

Key legislative leaders agree with the decision, as KING 5 reports.

"I absolutely agree with the court," said Rep. Ross Hunter, R-Medina.

The Chair of the Senate's Education Committee said the decision could help convince legislators, and the public, that more needs to be done to fund schools.

"That's really what we needed," said Senator Rosemary McAuliffe, D-Bothell, "We needed to be pushed by the courts to do that."

Sen. McAuliffe does not know if school funding reforms will require new taxes, but she said, "It provides us an opportunity to go out to the public and take the case to them."

The Columbian is out quickly with a good editorial. It's about setting priorities.

Now it’s up to the politicians to prioritize public education and meet the constitutional mandate without raising taxes.

We'll see how that works out.

Getting the Jobs Agenda Right

At WashACE, we're pro-job. Not a bold stance, I recognize. With state unemployment at 9.5 percent, I reckon everyone is pro-job. Nationally, we've seen the conversation shift - I think 'pivot' is the term of art - from health care to jobs. Particularly middle-class jobs. Particularly if they're in small businesses.

I'm not sure if unemployed workers are that picky about where they're next job comes from a small business or a large one. And, of course, a lot of small businesses exist primarily as corporate suppliers or service businesses that depend on the customer base provided by major regional employers. But, quibbles aside, it's good to see jobs back at the top of the legislative agendas here and in D.C.

Last week, Wenatchee World editorial page editor Tracy Warner wrote a good column on government's role in job creation.

I wish government could create jobs at will. A vote, a law, the stroke of a pen, and there you have it — tens of thousands of people returned to gainful employment. If that is not the way it actually works, sometimes that’s what they want us to think. If only it could.

After noting the particularly tough employment conditions today, Warner notes:

If government could create productive jobs at will it would do a lot more of it. More often, the taxing-and-hiring schemes cost more jobs than they create. If these plans worked we could be happily employed filling in holes government hired people to dig. But, if government can’t create jobs itself, it can create the conditions and help supply the means for private business to create jobs, the kind of jobs that produce more wealth than they consume. It’s been done.

Surveying the landscape of current legislative proposals he identifies some good and not-so-good ideas.

Gov. Gregoire wants tax credits for small businesses hiring new employees. She wants tax incentives for private investment. She wants streamlined permitting and regulation. This will lower the government-added cost of hiring. Make hiring new employees less expensive and you increase the odds people will do it.

Senate Democrats today endorsed the governor's tax break. (Link is to Publicola; not yet up on Senate site.) UPDATE: LInk on Senate site here.

Warner's skeptical of some other ideas.

The “green jobs” gambit, the idea that government can create an entirely new industry by subsidizing uneconomical forms of energy production, has not worked elsewhere and won’t work here.

...Other plans have little more promise. Adding $860 million to the state’s debt load to pay people to insulate schools is unlikely to have as much positive impact as promoters contend. It will save $190 million a year in energy costs, they say, but with energy prices so low in this state, large returns are not easily found. And borrowing such sums is problematical.

I share his skepticism. And I'm a little less confident in the small business tax break. People hire when it makes sense to hire from a business perspective. But it might help. Of more help would be action to reform workers' compensation and mitigate the extraordinary unemployment insurance tax increases that just hit employers here.

Warner's conclusion sums it up well.

The old-fashioned, less photogenic means of government job creation still work. Build on our infrastructure — transportation, energy, education, basic research. Do all to remain fiscally sound and minimize risk. Keep taxes on employment low and predictable. Do that first.

Do that. And don't do this.

WashACE Friday Phone Conference Podcast is Up

Listen to it here

And thanks to the members and supporters who joined us this morning. I'm looking forward to next week's conversation.

Race to the Top Legislation Introduced

The state's bid for Race to the Top money - a race TNT columnist Peter Callaghan wrote yesterday could be timed using the Mayan calendar - continues apace. Stateline.org has a good rundown on efforts by states nationally to qualify for the funding, along with the report that the president wants to add $1.35 billion to the funding. (More in this Christian Science Monitor story.)

At the Partnership for Learning blog you can see this poll confirming voter support for many of the RTT standards.

Callaghan also has a good story on what looks like a promising bill for Innovation Schools. 

The guidelines for RTT cash are pretty clear. Lawmakers know what needs to be done. And now's the time to do it.

The News Tribune on Race to the Top

The News Tribune makes another pitch for the state getting serious about Race to the Top dollars. You'll recall the governor passed on Round 1. I wrote about the issue here. From the TNT editorial:

Washington doesn’t offer genuine performance pay for high-caliber teachers. It doesn’t use easily available data to identify the most (and least) effective educators. It doesn’t permit state intervention in failing school districts. It doesn’t offer teachers enough support in mastering and doing their tough jobs.

It doesn’t demand rigorous study of science and math. It is one of the few states that still forbids charter schools.

These and other deficiencies have thrown the state out of the running for any of that federal money.

...There’s going to be another round of competition for the money. The requirements aren’t likely to change...

If lawmakers are willing to pass up this kind of money in the face of fiscal disaster – for the sake of avoiding proven reforms – it will be hard to take them seriously as supporters of quality education.

Right.

No Retreat on Education Accountability

Superintendent of Public Instruction Randy Dorn has called for, well, retreat on the state's math and science accountability standards. Here's his op-ed in yesterday's Seattle Times.

I am asking the Legislature to make four major changes regarding math and science:

• Delay the math graduation requirement to 2015.

• Establish a "two-tier" bar for the math graduation requirement in which one tier — "proficient" — is a goal but another — "basic" — is enough to earn a diploma.

• Create end-of-course tests in physical science and life science instead of offering a single comprehensive high-school science test.

• Delay the science graduation requirement until 2017, so we can gain some experience with these new tests.

It's because too many students can't meet the standards. This Times news story has reactions from education leaders.

Rumors about Dorn's proposals generated strong concern from groups such as the League of Education Voters and the Washington Roundtable, an association of corporate executives. Both organizations have been pushing for high-school standards that prepare all students to go to four-year colleges, even if they are not so inclined.

Dorn's proposal "doesn't appreciate the role that math and science play in our economy, and our future," said Lisa Macfarlane of the League of Education Voters.

Editorial boards across the state also reject Dorn's capitulation.

The Seattle Times:

Dorn's plan distracts from the need to compete for the $4 billion "Race to the Top" federal funds. Our education leader is at a precipice long ago reached by others. Three years ago, the Legislature approved a delay in the math graduation requirement because students were not prepared.

Another delay is unacceptable.

The News Tribune: 

Dorn’s plan is exactly the wrong approach for tough economic times. Settling for less from Washington’s students means settling for a lesser future for the state.

The Herald of Everett: 

With the Obama administration challenging states in a Race to the Top, now isn't the time to be lowering the bar in education.

That, however, is how we interpret state Superintendent Randy Dorn's proposal, unveiled Thursday, to further delay high-school graduation requirements in math and science — standards that were first pushed back just two years ago.

The Herald's editorial also notes ...

Dorn may also have met strong opposition within his own office. Seattle PostGlobe writer Joe Copeland, who first reported on Dorn's plans last week, wrote that Dorn's science director of teaching and learning, Mary McClellan, is resigning over “philosophical” differences.

A Herald report by Jerry Cornfield gives the governor's appropriately terse rejection of the delay. An excerpt:

We can't lower our standards in math, nor can we communicate that science is not important. We must prepare our students for their future. There is every reason to focus attention on the math and science learning needs of our students so they can succeed after high school.

The Superintendent is concerned about the graduation rate. I am concerned about the bigger picture - preparing kids for life. I think parents share that concern.

Precisely right.

Leaders and Laggards Report Puts Washington with the Latter

Last week's publication of "Leaders and Laggards," a collaborative report by the Center for American Progress, US Chamber of Commerce, and Frederick M. Hess of the American Enterprise Institute didn't get the play it should have. The authors are blunt:

Our school system needs far-reaching innovation. It is archaic and broken, a relic of a time when high school graduates could expect to live prosperous lives, when steel and auto factories formed the backbone of the American economy, and when laptop computers and the Internet were the preserve of science fiction writers. And while the challenges are many—inflexible regulations, excessive bureaucracy, a dearth of fresh thinking—the bottom line is that most education institutions simply lack the tools, incentives, and opportunities to reinvent themselves in profoundly more effective ways.

By “innovation” we do not mean blindly celebrating every nifty-sounding reform. If anything, we have had too much of such educational innovation over the years, as evidenced by the sequential embrace of fads and the hurried cycling from one new “best practice” to another that so often characterizes K-12 schooling. States and school systems, in other words, have too long confused the novel with the useful. Rather, we believe innovation to be the process of leveraging new tools, talent, and management strategies to craft solutions that were not possible or necessary in an earlier era.

They look at eight areas. Here's Washington's report card. We get a lousy D and rank 34th. Before you ask, South Carolina got a C.

Quote of the Day

A wry observation from the unanimous decision cited earlier.

Finally, eight of the parent and teacher respondents claim standing as taxpayers because they were unable to pay higher taxes in support of FederalWay School District due to limits on levy authority that are tied to the salary allocations. While taxpayers may have standing to protest high taxes or improper expenditures, this court has said it is doubtful there is taxpayer standing to protest lower taxes or limits on taxation... Moreover, the posture of the parent and teacher respondents' argument is misleading; they do not merely seek to support Federal Way School District. That could be accomplished by bypassing the tax system and voluntarily contributing to the school district directly.

Their complaint apparently is that the school district is unable to ask for more taxes from them (and others). A municipal corporation's inability to ask for voter approval of a levy for a specific dollar amount is not a justiciable harm to an individual taxpayer.

Yep.