With the release of an initial budget today, the mathematical manipulations and distortions begin. It actually began two weeks ago when Superintendent Tom Horne said the cuts would only be 2% and most districts were simply panicking by laying off so many teachers. He has since backed way off his original 2%, saying on Horizon the number could actually be closer to 6%. Then today we had folks e-mailing that charters are being cut significantly less than districts; and finally, there was the article from one legislator saying the cuts were only 1.3%. Unfortunately, all of these statements are true in one sense, but false in another, especially when considered at the individual district or charter school level.
Is there a district in Arizona receiving a net 1.3% cut in general fund revenue after the addition of Title 1 and IDEA stimulus money? There probably is. Unfortunately, general fund revenue is only one source of school funding. This same district most likely has a cut in prop 301 funding, casino gaming revenue, declining enrollment, excess utilities and increased health insurance costs that push it way past 1.3%. This is what is dangerous about Tom Horne's statement and the statement made by a state lawmaker earlier today.
What about Charter schools vs. District cuts? Special provisions have been made for districts with fewer than 600 students (they were exempted from cuts in the 2009 fix and it is being proposed that they only receive 50% of the cuts in 2010) At the same time, almost all charter schools are below 600 students because there are advantages in statute to being a "small school." Charter school cuts come in the form of a per pupil cut, rather than a percentage. The House budget proposes a charter school cut of $60 per pupil. This is in addition to the per pupil cut of $40 in January. When small district cuts and charter school cuts are compared side by side, and taking into account the 2009 cuts, then the reductions are very similar for both. However, as was done by a school board member today, if someone takes the cut being proposed for a large district and compares it to a small charter school, especially a district that has excess utilities, bonds and overrides, then there is a definite difference.
At the same time, it is not a completely accurate statement to say that charter schools receive less funding than districts. When talking about all charters and districts in aggregate, then it is true that districts receive more per pupil funding than charters. However, when looked at by individual district vs. the local charter school(s) in their community, then this is not always true. For example, there are rural school districts who do not have Career Ladder, Excess Utilities, Teacher Experience Index, bonds, overrides, etc. In a growing number of these communities, the charter schools actually receive more per pupil funding than the local district (as an aside, this is not true for most of Maricopa County).
Whenever you hear a comparative statistic, consider the source! People are focusing so much on the "half truths" of Arizona education funding that we completely miss the boat on comprehensive education finance reform and long-term planning. I hope that as ABEC lays out their plans this fall, that we are able to focus on what's best for all children, regardless of where their parents send them to school.
Monday, April 27, 2009
Sunday, April 26, 2009
Update on the State Budget
It looks like this week the House and Senate will finally have a detailed budget out for review, debate and negotiation. The last several weeks have been spent gathering information from state agencies and learning details and timelines for stimulus funding.
In addition, leadership is working with the reality that a large tax increase is probably not on the table. To pass a tax increase requires a 2/3 vote. Members of both the Republican and Democrat parties have voiced public opposition to a large tax hike, putting in doubt whether there are 20 Senators and 40 Representatives who would vote for it.
This means the only short-term solutions are cuts, sweeps, reform and borrowing. Longer-term solutions such as comprehensive tax reform and comprehensive education finance reform (as blogged about earlier) will be worked on over the summer to be voted on next session.
Once again, before talking specific details of the education budget, remember that the budget could morph greatly as negotiations take place to get 31 House, 16 Senate, and 1 Governor vote(s). The comments below are where the budget is today.
With regards to education funding, the House and Senate are fairly close to each other with regards to the size of the lump sum cut. There will most likely be a 3% - 4% cut from soft capital. This equates to approximately $150 - $200 million. The original idea was to reduce the base level by this amount but it ended up negatively impacting overrides so soft capital will be reduced instead.
There are other cuts proposed but they affect only certain districts. For example, there is still a proposal to phase out Career Ladder at 28 districts over 11 years. In addition, the funding for Arizona's virtual learning programs (called TAPBI) will be reduced by a certain %; however, the good news is that all districts can now have a TAPBI program and more virtual schools will be allowed statewide.
There is still elimination of the early learners program (the state paying for two years of kindergarten); however, what concerns me in this area is that certain Senators have proposed not funding this year's early learners for kindergarten next year. This means you are going to tell several dozen charter schools and a handful of districts that they have to allow these kids to take kindergarten, but they will receive no funding? And what about the child who transfers to a completely new district or charter school for kindergarten? Do they have to provide kindergarten at no cost?
Continuing on, small school districts (<600 students) will only have 1/2 of the cuts that larger districts receive and charter schools are looking at about a $75 per pupil reduction for 2010.
With regards to ending fund balances of school districts being swept, certain legislators are discovering there is no such thing as "free cash" available for the taking. Any cash swept this year would most likely be made up next year by a local levy. This means those folks pushing to take $300 - $400 million of school balances are actually pushing for a large property tax hike next year. There are a dozen reasons why this is a bad idea, but three of the biggest are these:
1) Those districts who planned for the future (i.e. the end of excess utilities funding, lower sales tax collections, etc.) are the very districts now being punished. Great way to reward competence.
2) Investment banking firms who place bonds for Arizona districts are able to negotiate lower interest rates when there is a positive cash balance, as opposed to a zero, or negative cash balance, as has been proposed.
3) Sweeping ending balances is the most inequitable way of solving a budget crisis. Lots of districts have no ending cash balance, or a negative balance. This will drive up property taxes for some and not for others.
Besides the numbers for education, the bigger debate will be around policy changes accompanying the budget (see the earlier blog on budget BRBs). Will districts be allowed to have 15% overrides? Will bonding be allowed for soft capital? One thing is for sure, both House and Senate leadership want to allow as much flexibility with remaining dollars as possible. For example, any remaining soft capital can be used for M & O expenses.
At the end of the day, there is still about a $400 million hole that cannot be filled easily. The majority of members will not allow any higher cuts to education, which is a relief to me, so other ideas will have to be put forth. Ideas being discussed are rollovers, securitization of the lottery, sale/leaseback of buildings, deeper cuts, etc. These ideas each come with their own set of negative consequences so the next few weeks should prove interesting as members stake out their "die-on-the-hill" issues. One thing is for sure, the chances of this negotiation process taking another month or two is very high.
In addition, leadership is working with the reality that a large tax increase is probably not on the table. To pass a tax increase requires a 2/3 vote. Members of both the Republican and Democrat parties have voiced public opposition to a large tax hike, putting in doubt whether there are 20 Senators and 40 Representatives who would vote for it.
This means the only short-term solutions are cuts, sweeps, reform and borrowing. Longer-term solutions such as comprehensive tax reform and comprehensive education finance reform (as blogged about earlier) will be worked on over the summer to be voted on next session.
Once again, before talking specific details of the education budget, remember that the budget could morph greatly as negotiations take place to get 31 House, 16 Senate, and 1 Governor vote(s). The comments below are where the budget is today.
With regards to education funding, the House and Senate are fairly close to each other with regards to the size of the lump sum cut. There will most likely be a 3% - 4% cut from soft capital. This equates to approximately $150 - $200 million. The original idea was to reduce the base level by this amount but it ended up negatively impacting overrides so soft capital will be reduced instead.
There are other cuts proposed but they affect only certain districts. For example, there is still a proposal to phase out Career Ladder at 28 districts over 11 years. In addition, the funding for Arizona's virtual learning programs (called TAPBI) will be reduced by a certain %; however, the good news is that all districts can now have a TAPBI program and more virtual schools will be allowed statewide.
There is still elimination of the early learners program (the state paying for two years of kindergarten); however, what concerns me in this area is that certain Senators have proposed not funding this year's early learners for kindergarten next year. This means you are going to tell several dozen charter schools and a handful of districts that they have to allow these kids to take kindergarten, but they will receive no funding? And what about the child who transfers to a completely new district or charter school for kindergarten? Do they have to provide kindergarten at no cost?
Continuing on, small school districts (<600 students) will only have 1/2 of the cuts that larger districts receive and charter schools are looking at about a $75 per pupil reduction for 2010.
With regards to ending fund balances of school districts being swept, certain legislators are discovering there is no such thing as "free cash" available for the taking. Any cash swept this year would most likely be made up next year by a local levy. This means those folks pushing to take $300 - $400 million of school balances are actually pushing for a large property tax hike next year. There are a dozen reasons why this is a bad idea, but three of the biggest are these:
1) Those districts who planned for the future (i.e. the end of excess utilities funding, lower sales tax collections, etc.) are the very districts now being punished. Great way to reward competence.
2) Investment banking firms who place bonds for Arizona districts are able to negotiate lower interest rates when there is a positive cash balance, as opposed to a zero, or negative cash balance, as has been proposed.
3) Sweeping ending balances is the most inequitable way of solving a budget crisis. Lots of districts have no ending cash balance, or a negative balance. This will drive up property taxes for some and not for others.
Besides the numbers for education, the bigger debate will be around policy changes accompanying the budget (see the earlier blog on budget BRBs). Will districts be allowed to have 15% overrides? Will bonding be allowed for soft capital? One thing is for sure, both House and Senate leadership want to allow as much flexibility with remaining dollars as possible. For example, any remaining soft capital can be used for M & O expenses.
At the end of the day, there is still about a $400 million hole that cannot be filled easily. The majority of members will not allow any higher cuts to education, which is a relief to me, so other ideas will have to be put forth. Ideas being discussed are rollovers, securitization of the lottery, sale/leaseback of buildings, deeper cuts, etc. These ideas each come with their own set of negative consequences so the next few weeks should prove interesting as members stake out their "die-on-the-hill" issues. One thing is for sure, the chances of this negotiation process taking another month or two is very high.
Tuesday, April 14, 2009
The Future of School Finance - One Perspective
If it is not obvious by now, our current school finance system is not working. The swings in sales and income tax collections, the inconsistent returns on state trust land, the inequities from overrides and bonds, as well as a dozen other things, all contribute to a funding model that is not meeting our needs. It is inconceivable to think we can reduce education funding (both from the general fund and other revenue sources) and think there will not be long-term consequences.
Many people foresaw the perfect storm in school budget cuts coming for 2010, but getting finance reform through the legislature has proven to be very difficult (no thanks to term limits and clean elections). Back in 2004-2005, Rep. Tom Boone proposed major changes to Excess Utilities funding and overrides; however, after months of work, his bill failed to garner sufficient votes.
At the same time, the Arizona Business and Education Coalition (http://www.azbec.org/) was in the process of drafting a framework for comprehensive school finance reform. They have since finished their framework and have been holding town halls across the State getting feedback.
Last week, Speaker Kirk Adams and I met with ABEC to discuss the next step. Utilizing their expertise on the subject, we asked ABEC to help us prepare detailed school finance reform to be introduced next session. With the help of Senator John Huppenthal, Chair of the Senate Education Committee, we intend to make every effort to pass legislation that adequately funds education, provides accountability, and provides incentives for academic achievement.
Visit ABEC's website often to keep up to date on the process.
Many people foresaw the perfect storm in school budget cuts coming for 2010, but getting finance reform through the legislature has proven to be very difficult (no thanks to term limits and clean elections). Back in 2004-2005, Rep. Tom Boone proposed major changes to Excess Utilities funding and overrides; however, after months of work, his bill failed to garner sufficient votes.
At the same time, the Arizona Business and Education Coalition (http://www.azbec.org/) was in the process of drafting a framework for comprehensive school finance reform. They have since finished their framework and have been holding town halls across the State getting feedback.
Last week, Speaker Kirk Adams and I met with ABEC to discuss the next step. Utilizing their expertise on the subject, we asked ABEC to help us prepare detailed school finance reform to be introduced next session. With the help of Senator John Huppenthal, Chair of the Senate Education Committee, we intend to make every effort to pass legislation that adequately funds education, provides accountability, and provides incentives for academic achievement.
Visit ABEC's website often to keep up to date on the process.
Wednesday, April 8, 2009
What Should Small Schools Expect?
During the 2009 budget fix in January of this year, small school districts (those defined as fewer than 600 students) were held harmless from the cuts. For the 2010 budget, it is being proposed that small school districts only receive 1/2 of the lump sum cuts being proposed. There are several reasons for this but the main reason is that small districts lack economies of scale with which to handle any cuts.
The 50% exemption will not apply to charter schools as their funding formula is different from districts. It has been proposed that they receive a reduction in funding per pupil instead, somewhere in the range of $75 per student.
As with all budget items discussed on this blog, it is important to remember two things. First, it is truly our desire to not have to make any cuts. The majority of legislators have children or grandchildren in public schools. The choices we make affect them too. Only because the deficit is so large is education even being considered for cuts. All state agencies and programs will take some level of cuts. Our goal is to minimize the impact and avoid long-term damage.
Second, please remember that any budget item has to be voted on by the Senate and House and then signed by the Governor. We are doing our best to share with you what we think will happen but we make no absolute guarantees.
The 50% exemption will not apply to charter schools as their funding formula is different from districts. It has been proposed that they receive a reduction in funding per pupil instead, somewhere in the range of $75 per student.
As with all budget items discussed on this blog, it is important to remember two things. First, it is truly our desire to not have to make any cuts. The majority of legislators have children or grandchildren in public schools. The choices we make affect them too. Only because the deficit is so large is education even being considered for cuts. All state agencies and programs will take some level of cuts. Our goal is to minimize the impact and avoid long-term damage.
Second, please remember that any budget item has to be voted on by the Senate and House and then signed by the Governor. We are doing our best to share with you what we think will happen but we make no absolute guarantees.
Recommitting to Updates
As you can see, I have done a poor job keeping this blog up to date while we worked on the budget. Part of the reason was not wanting to put something out there that might end up changing; however, this ended up being a useless strategy as budget conversations are always in a state of flux. If I waited until everything was a sure bet, I would blog the day after the budget was signed by the Governor and you would have already read everything in the newspaper.
To that end, I recommit to you to keep this blog updated with new information several times a week. We will probably write shorter pieces but share more about the discussions taking place with regards to the education budget. At the same time, we are going to make you aware of conversations occurring across the state with regards to the future of education in Arizona. There are some big thinkers out there with bold ideas for a globally competitive education system.
To that end, I recommit to you to keep this blog updated with new information several times a week. We will probably write shorter pieces but share more about the discussions taking place with regards to the education budget. At the same time, we are going to make you aware of conversations occurring across the state with regards to the future of education in Arizona. There are some big thinkers out there with bold ideas for a globally competitive education system.
Sunday, March 15, 2009
2010 Budget - Update
Now that the effects of the federal stimulus on education funding are becoming clearer, it is time for a 2010 education budget update. If you will recall, the State has projected a budget deficit for 2010 of approximately $3.2 billion. The solution to this deficit will not come from cuts alone, federal stimulus alone, revenue enhancements alone, from borrowing alone or from program shifts alone. Although not popular to say, the solution will most likely include some combination of three or four of these ideas.
Two things that are fairly well accepted by most legislators is that the federal stimulus money for education will keep the 2010 cuts from being as catastrophic as originally presented. Secondly, given the size of the deficit, all programs and agencies in Arizona will have to contribute something toward its solution. This includes education. Where there is tremendous debate is with the size of the cuts.
In recent conversations among appropriation leaders (chairs, vice-chairs and certain members), the desire to provide flexibility to school districts when making cuts has arisen as a top priority. In addition, these conversations seem to indicate that all options are still on the table; however, it is very difficult to see how the Governor's desire to send a tax increase to the ballot could garner sufficient votes to pass (let alone be passed by the voters). However, politics being what they are, never count the idea out until session is over.
The best way to provide flexibility to school districts is to not eliminate specific programs such as All-day K, but rather to provide for an across the board cut. This way the pain is more equitable and local schools and districts can decide for themselves which programs to keep and which to cut. So as not to be misunderstood, there may still be smaller programs that get cut such as the Early Learner program that pays for kindergarten twice; however, the majority of any cuts will be offered as a lump sum reduction.
If you consider that a 1% reduction in K-12 funding is approximately $50 million, then the size of new cuts to K-12 education being debated for 2010 is somewhere between 4% and 7%. Keep in mind that certain cuts to education do not come from the State Legislature such as reductions in sales tax collected (prop 301), gaming revenue (prop 202) or the effects of declining enrollment.
And finally, several people are asking about the April 15 deadline to notify teachers about next year's contracts. An agreement is being negotiated among the Senate, House and Governor's office that would suspend this requirement for this year only, or push the date back 30-60 days. More updates will be posted as information becomes available.
Two things that are fairly well accepted by most legislators is that the federal stimulus money for education will keep the 2010 cuts from being as catastrophic as originally presented. Secondly, given the size of the deficit, all programs and agencies in Arizona will have to contribute something toward its solution. This includes education. Where there is tremendous debate is with the size of the cuts.
In recent conversations among appropriation leaders (chairs, vice-chairs and certain members), the desire to provide flexibility to school districts when making cuts has arisen as a top priority. In addition, these conversations seem to indicate that all options are still on the table; however, it is very difficult to see how the Governor's desire to send a tax increase to the ballot could garner sufficient votes to pass (let alone be passed by the voters). However, politics being what they are, never count the idea out until session is over.
The best way to provide flexibility to school districts is to not eliminate specific programs such as All-day K, but rather to provide for an across the board cut. This way the pain is more equitable and local schools and districts can decide for themselves which programs to keep and which to cut. So as not to be misunderstood, there may still be smaller programs that get cut such as the Early Learner program that pays for kindergarten twice; however, the majority of any cuts will be offered as a lump sum reduction.
If you consider that a 1% reduction in K-12 funding is approximately $50 million, then the size of new cuts to K-12 education being debated for 2010 is somewhere between 4% and 7%. Keep in mind that certain cuts to education do not come from the State Legislature such as reductions in sales tax collected (prop 301), gaming revenue (prop 202) or the effects of declining enrollment.
And finally, several people are asking about the April 15 deadline to notify teachers about next year's contracts. An agreement is being negotiated among the Senate, House and Governor's office that would suspend this requirement for this year only, or push the date back 30-60 days. More updates will be posted as information becomes available.
Helicopter Parents
One day my daughter came home from school and informed me that one of her teachers had said I was turning into a "helicopter parent". Because I had a great relationship with the teacher I knew he was kidding, but not totally. As I learned from my time on the Mesa School Board, helicopter parents hover over their children always making sure they do their best. Sometimes they can get a little out of hand (like one particular cheerleader mom I know) but for the most part helicopter parents are constantly looking out for what's best for their children. Their kids are usually high achievers, talented, athletic and/or motivated.
High school helicopter parents are actually the most intense. About half way through my school board term, I started keeping track of lessons learned from them to use on my own seven children. Here they are in no particular order.
Helicopter parents:
Check up on their kids. Today's schools have systems in place to allow parents to check attendance, grades, behavior, etc. Sometimes this is on-line, via phone call or in a teacher conference. Warning signs of possible trouble ahead typically show up first in one of these areas. With today's tools, finding out your kids math scores or whether they went to class is as easy as looking up your checking account balance. Check with your child's school for options.
Don't just look at their neighborhood school. Arizona's open enrollment laws are some of the best in the country. Maybe your neighborhood school, within walking distance, is the best for your child; maybe not? Helicopter parents typically look at other schools within the district, or charter schools, or private schools, etc. to find the best fit for their child. Of course, several factors must be considered but it is nice to have options.
Have their child take a course on-line. After high school, almost all colleges and universities require/offer courses on-line. In addition, taking on-line courses in high school offers flexibility and variety. Parents who want their kids to graduate early, make up credits, take college courses, or have more room for electives will often have their students take courses on-line.
Take advantage of standardized tests such as the ACT, SAT, or PSAT. There is no downside to taking a national standardized test on a Saturday morning. If you "fail" the ACT exam, it has no impact on your high school grades or graduation. However, if you take one of the standardized tests, and do well, look at the potential rewards; college credit, scholarships, awards, etc. Also, If you take an AP or IB class, be sure to take the corresponding exam. It could pay large dividends.
Make the most of senior year. So many students can't wait until their senior year to go a half day. Families need to decide if this is the best use of their child's time. If a student can complete their freshman year of college while still in high school, thousands of dollars in tuition can be saved. Alternatively, there are several Career and Technical Education courses that can be taken senior year that lead quickly toward certification and good paying jobs.
Talk post high school very early. Nowadays, no matter who you are, the chances of only a high school diploma leading you to a career that can comfortably support a family of four is almost non-existent. Helicopter parents talk early with their kids about the necessity for education and training after high school and plan accordingly. There are so many options; college, trade school, military, apprenticeships, etc. or any combination of the following.
High school helicopter parents are actually the most intense. About half way through my school board term, I started keeping track of lessons learned from them to use on my own seven children. Here they are in no particular order.
Helicopter parents:
Check up on their kids. Today's schools have systems in place to allow parents to check attendance, grades, behavior, etc. Sometimes this is on-line, via phone call or in a teacher conference. Warning signs of possible trouble ahead typically show up first in one of these areas. With today's tools, finding out your kids math scores or whether they went to class is as easy as looking up your checking account balance. Check with your child's school for options.
Don't just look at their neighborhood school. Arizona's open enrollment laws are some of the best in the country. Maybe your neighborhood school, within walking distance, is the best for your child; maybe not? Helicopter parents typically look at other schools within the district, or charter schools, or private schools, etc. to find the best fit for their child. Of course, several factors must be considered but it is nice to have options.
Have their child take a course on-line. After high school, almost all colleges and universities require/offer courses on-line. In addition, taking on-line courses in high school offers flexibility and variety. Parents who want their kids to graduate early, make up credits, take college courses, or have more room for electives will often have their students take courses on-line.
Take advantage of standardized tests such as the ACT, SAT, or PSAT. There is no downside to taking a national standardized test on a Saturday morning. If you "fail" the ACT exam, it has no impact on your high school grades or graduation. However, if you take one of the standardized tests, and do well, look at the potential rewards; college credit, scholarships, awards, etc. Also, If you take an AP or IB class, be sure to take the corresponding exam. It could pay large dividends.
Make the most of senior year. So many students can't wait until their senior year to go a half day. Families need to decide if this is the best use of their child's time. If a student can complete their freshman year of college while still in high school, thousands of dollars in tuition can be saved. Alternatively, there are several Career and Technical Education courses that can be taken senior year that lead quickly toward certification and good paying jobs.
Talk post high school very early. Nowadays, no matter who you are, the chances of only a high school diploma leading you to a career that can comfortably support a family of four is almost non-existent. Helicopter parents talk early with their kids about the necessity for education and training after high school and plan accordingly. There are so many options; college, trade school, military, apprenticeships, etc. or any combination of the following.
Sunday, February 22, 2009
2010 Budget - When it Rains, it Pours
School districts across Arizona receive funding from several different sources, not just the state budget (although that is the largest piece). Unfortunately, mainly due to the economy, several of these additional funding sources are down for 2010.
For example, a majority of districts in Arizona had declining enrollment in 2009. A large percentage of the decline can be attributed to foreclosures and relocations due to job losses. Because districts are paid one year in arrears, the impact of declining enrollment will be felt hard in 2010. With that said, there are a dozen or so districts that are still growing rapidly and we will have to address their unique issues in the 2010 budget (i.e. new school facilities, soft capital for furniture, etc.)
One other area impacting school funding is sales tax. School districts receive sales tax proceeds as a result of Prop 301. A large portion of this funding is used for teacher salaries. Schools are being told that as a result of declining sales across all categories, the proceeds from prop 301 will be down by at least $60 per student. For the Mesa Public Schools and their 70,000 students, this is a $4,000,000 hit that is completely outside of the state budget.
A similar conversation can occur for casino gaming proceeds. As a result of the tribal gaming agreement signed several years ago, school districts receive a percentage of casino earnings per student. Because casino revenues have dropped this year, so will the portion going to education in 2010. This is also outside of the state budget.
Finally, the Arizona Department of Education recently made a decision to fund English Language Learners at $8.8 million for 2010, instead of the $40 million they funded in 2009. It is the opinion of someone at ADE that the state can comply with the ELL Task Force model for 25% of the funding it took to comply in 2009. Whereas the Mesa School District received $1.8 million of ELL funding in 2009, they will be receiving zero in 2010. This is also outside of the state budget.
So what does all of this mean? There are actually two important points to make. First, we recently received several e-mails from a group of teachers in eastern Arizona complaining that the Legislature had cut their district budget by 8%. We truly feel for these teachers and the situation they are in; however, the legislative cuts for 2009 were around 2.5%. After staff looked into their situation, it was determined that this particular district had been hit hard by a whole wave of bad luck including declining enrollment, job losses and rising expenses. With that said, it still does not provide much comfort when your paycheck has been reduced so that the district can make it through the end of the school year.
Second point, all legislators need to remember that any cuts proposed for 2010 will be on top of the items already discussed here. For many districts, they will face at least a 5% budget cut before any impact from the 2010 state budget. We promise to consider these outside reductions as we set our 2010 budget and try to grapple with a $3.2 billion deficit.
For example, a majority of districts in Arizona had declining enrollment in 2009. A large percentage of the decline can be attributed to foreclosures and relocations due to job losses. Because districts are paid one year in arrears, the impact of declining enrollment will be felt hard in 2010. With that said, there are a dozen or so districts that are still growing rapidly and we will have to address their unique issues in the 2010 budget (i.e. new school facilities, soft capital for furniture, etc.)
One other area impacting school funding is sales tax. School districts receive sales tax proceeds as a result of Prop 301. A large portion of this funding is used for teacher salaries. Schools are being told that as a result of declining sales across all categories, the proceeds from prop 301 will be down by at least $60 per student. For the Mesa Public Schools and their 70,000 students, this is a $4,000,000 hit that is completely outside of the state budget.
A similar conversation can occur for casino gaming proceeds. As a result of the tribal gaming agreement signed several years ago, school districts receive a percentage of casino earnings per student. Because casino revenues have dropped this year, so will the portion going to education in 2010. This is also outside of the state budget.
Finally, the Arizona Department of Education recently made a decision to fund English Language Learners at $8.8 million for 2010, instead of the $40 million they funded in 2009. It is the opinion of someone at ADE that the state can comply with the ELL Task Force model for 25% of the funding it took to comply in 2009. Whereas the Mesa School District received $1.8 million of ELL funding in 2009, they will be receiving zero in 2010. This is also outside of the state budget.
So what does all of this mean? There are actually two important points to make. First, we recently received several e-mails from a group of teachers in eastern Arizona complaining that the Legislature had cut their district budget by 8%. We truly feel for these teachers and the situation they are in; however, the legislative cuts for 2009 were around 2.5%. After staff looked into their situation, it was determined that this particular district had been hit hard by a whole wave of bad luck including declining enrollment, job losses and rising expenses. With that said, it still does not provide much comfort when your paycheck has been reduced so that the district can make it through the end of the school year.
Second point, all legislators need to remember that any cuts proposed for 2010 will be on top of the items already discussed here. For many districts, they will face at least a 5% budget cut before any impact from the 2010 state budget. We promise to consider these outside reductions as we set our 2010 budget and try to grapple with a $3.2 billion deficit.
2010 Budget - What's Happening Now?
Many people are wondering where we are with the 2010 education budget? The past three weeks have been spent listening to educators, parents and students across the state, gathering ideas, setting priorities, and discussing technical school finance issues.
This month we made trips to Flagstaff and Tucson for Education Committee meetings. The House Education Chair made a trip to Safford to visit with all of the school superintendents from Graham and Greenlee counties. In addition, committee members met with parent groups from Scottsdale and Madison as well as the Higley PTOs.
Coming up this week is an education community meeting in Casa Grande as well as a weekend conference in Scottsdale with 125 education legislators from across the country to discuss education funding and academic achievement.
Finally, legislators are meeting in small groups to start weighing in on their individual priorities for the 2010 budget. For example, one area that many members have weighed in on is the option from the Appropriation Chairmen to cut $2,000,000 from gifted education. Virtually none of the money in the federal stimulus can be used for gifted children; therefore, several members agree that it makes no sense to cut the small pot of money dedicated to educating our best and brightest.
Stay tuned for more updates. We recognize that statute requires school districts to notify teachers by April 15 if they have a job next year or not. It would sure help districts out if we had a budget before then.
This month we made trips to Flagstaff and Tucson for Education Committee meetings. The House Education Chair made a trip to Safford to visit with all of the school superintendents from Graham and Greenlee counties. In addition, committee members met with parent groups from Scottsdale and Madison as well as the Higley PTOs.
Coming up this week is an education community meeting in Casa Grande as well as a weekend conference in Scottsdale with 125 education legislators from across the country to discuss education funding and academic achievement.
Finally, legislators are meeting in small groups to start weighing in on their individual priorities for the 2010 budget. For example, one area that many members have weighed in on is the option from the Appropriation Chairmen to cut $2,000,000 from gifted education. Virtually none of the money in the federal stimulus can be used for gifted children; therefore, several members agree that it makes no sense to cut the small pot of money dedicated to educating our best and brightest.
Stay tuned for more updates. We recognize that statute requires school districts to notify teachers by April 15 if they have a job next year or not. It would sure help districts out if we had a budget before then.
Sunday, February 15, 2009
2010 Budget - All-Day Kindergarten
Of all the topics being discussed regarding the upcoming K-12 budget, the one that seems to get the most press is all-day Kindergarten. At present, all-day K costs the state approximately $218 million per year. There is a strong divide between those who say it is simply state paid childcare and those who say it is a critical beginning for young children.
The research tends to support both arguments. Children who attend all-day K who come from parent educated homes, with moderate to high incomes fare no better by third grade than children from the same background who only attended half-day kindergarten.
However, disadvantaged children (i.e. single parent, low-income, developmentally delayed, etc.) who attend all-day K show better results by third grade than their counterparts who attend only a half-day program.
So what is the solution? It is probably something in the middle. When all-day K first began it was only offered at low-income schools as determined by free and reduced lunch percentages. A return to this idea will probably not make either side happy but it will give each something to hang on to.
If all-day K were offered at only those schools that had 60% or more free and reduced percentages, the state would save over $100 million while still providing a critical early learning experience to children who benefit most. Districts and schools who want to offer a tuition-based program for all-day K are always welcome to do so.
The research tends to support both arguments. Children who attend all-day K who come from parent educated homes, with moderate to high incomes fare no better by third grade than children from the same background who only attended half-day kindergarten.
However, disadvantaged children (i.e. single parent, low-income, developmentally delayed, etc.) who attend all-day K show better results by third grade than their counterparts who attend only a half-day program.
So what is the solution? It is probably something in the middle. When all-day K first began it was only offered at low-income schools as determined by free and reduced lunch percentages. A return to this idea will probably not make either side happy but it will give each something to hang on to.
If all-day K were offered at only those schools that had 60% or more free and reduced percentages, the state would save over $100 million while still providing a critical early learning experience to children who benefit most. Districts and schools who want to offer a tuition-based program for all-day K are always welcome to do so.
Wednesday, February 11, 2009
2010 Budget - Early Learners
Several years ago, a number of charter schools and school districts decided to take advantage of the law that allowed schools to admit students into kindergarten who were four years old on September 1st, but who turned five before December 31st. This law was actually put in place so that parents who felt their child was ready could begin kindergarten at age four and then move on to 1st grade the next year.
What these charters and districts started doing was accepting four year old children who were not quite ready for kindergarten, and then retaining them at the end of the school year to repeat kindergarten. They even had a name for it, "Early Learners." The schools were then paid twice for kindergarten for these children.
So here is the challenge for the Legislature. It is now 2009 and there are a handful of districts and charters that are having a very large number of children repeat kindergarten - to the tune of approximately $11.2 million. This is not fair to the majority of districts and charters in Arizona who only accept four year olds who are ready for kindergarten. Even though we recognize the benefits of early education for four year olds, having pre-school paid for by the State, under the guise of kindergarten, is not the best use of state resources. If a district or charter wants to offer a tuition-based, pre-school program, we applaud their efforts and encourage them to do so.
There is a very high probability that this program of paying for kindergarten twice will be eliminated under the FY2010 K-12 budget in order to save $11.2 million. The good news is that for most districts and charters in Arizona, they will not see any budget cut as a result of the elimination of this program.
What these charters and districts started doing was accepting four year old children who were not quite ready for kindergarten, and then retaining them at the end of the school year to repeat kindergarten. They even had a name for it, "Early Learners." The schools were then paid twice for kindergarten for these children.
So here is the challenge for the Legislature. It is now 2009 and there are a handful of districts and charters that are having a very large number of children repeat kindergarten - to the tune of approximately $11.2 million. This is not fair to the majority of districts and charters in Arizona who only accept four year olds who are ready for kindergarten. Even though we recognize the benefits of early education for four year olds, having pre-school paid for by the State, under the guise of kindergarten, is not the best use of state resources. If a district or charter wants to offer a tuition-based, pre-school program, we applaud their efforts and encourage them to do so.
There is a very high probability that this program of paying for kindergarten twice will be eliminated under the FY2010 K-12 budget in order to save $11.2 million. The good news is that for most districts and charters in Arizona, they will not see any budget cut as a result of the elimination of this program.
2010 Budget - Fair Criticism
Recently, we received an e-mail from a parent concerned about budget cuts for FY2010 in response to a letter she had received from her school district's Superintendent. The e-mail from the parent had completely inaccurate information regarding the FY2010 budget process. Because we had a great relationship with the Superintendent, we called him up and asked a few questions.
He very graciously explained that one reason parents and teachers are in such a panic is because the only printed information out there for people to read are the Chairmen's options, which total almost $900 million in cuts in FY2010. This "options" book was put out early in session to list every possible cut available to legislators. Those of us down at the Capitol know that there will never be $900 million in cuts to K-12 funding; but, unless you are down here, you wouldn't know this.
The statement made by this Superintendent is a fair criticism of the process. In order to provide additional information for parents and teachers, we are going to start listing items in the K-12 budget items that are being discussed during the FY 2010 budget process on the blog. However, keep in mind that nothing passes through the Legislature without 31 Representative votes, 16 Senator votes and the Governor's signature. This means everything is up for discussion until the very end.
Blog entries relating to the budget will always begin with the title "2010 Budget - and then the name of the area being discussed".
He very graciously explained that one reason parents and teachers are in such a panic is because the only printed information out there for people to read are the Chairmen's options, which total almost $900 million in cuts in FY2010. This "options" book was put out early in session to list every possible cut available to legislators. Those of us down at the Capitol know that there will never be $900 million in cuts to K-12 funding; but, unless you are down here, you wouldn't know this.
The statement made by this Superintendent is a fair criticism of the process. In order to provide additional information for parents and teachers, we are going to start listing items in the K-12 budget items that are being discussed during the FY 2010 budget process on the blog. However, keep in mind that nothing passes through the Legislature without 31 Representative votes, 16 Senator votes and the Governor's signature. This means everything is up for discussion until the very end.
Blog entries relating to the budget will always begin with the title "2010 Budget - and then the name of the area being discussed".
Sunday, February 8, 2009
ACT Pilot Project - Something to Aim For
Yes, we have some budget challenges, but we still have to teach our children and encourage them to achieve. One of the more exciting things coming up is the Arizona ACT pilot project. For the past several years, Arizona has had the lowest percentage among all 50 states of students taking a college entrance exam. We have the opportunity to quickly turn this around.
Once each year, the American College Testing (ACT) organization offers a weekday option (instead of a Saturday) of the ACT college entrance exam for statewide (i.e. CO, IL, MI, TN and MS) and school district participants. This year the exam is being offered on Wednesday, April 22, 2009. The cost to participate is $31 per student, but thanks to a $250,000 seed grant from the Helios Education Foundation and participation from each of the school districts, this pilot project has become a reality, at no cost to the student.
Eight school districts (Flagstaff, Globe, Lake Havasu, Mesa, Peoria, Phoenix Union, Round Valley, and Window Rock) have accepted the challenge to participate in this pilot project. Each of these superintendents and their respective school boards have agreed to take the bold step of testing every junior in their district on Wednesday, April 22. These eight districts have a combined enrollment of approximately 15,000 juniors.
Over the next three months, you will hear more about this pilot project and the test results. Just a quick thought, if you are the parent of a junior not in one of the eight pilot districts, encourage your child to take the ACT or SAT college entrance exam. There is very little downside to taking the exam and huge upside potential. Click on the links below to get to the right website.
ACT Exam SAT Exam
ACT/SAT 2007
ACT vs SAT 2008
Once each year, the American College Testing (ACT) organization offers a weekday option (instead of a Saturday) of the ACT college entrance exam for statewide (i.e. CO, IL, MI, TN and MS) and school district participants. This year the exam is being offered on Wednesday, April 22, 2009. The cost to participate is $31 per student, but thanks to a $250,000 seed grant from the Helios Education Foundation and participation from each of the school districts, this pilot project has become a reality, at no cost to the student.
Eight school districts (Flagstaff, Globe, Lake Havasu, Mesa, Peoria, Phoenix Union, Round Valley, and Window Rock) have accepted the challenge to participate in this pilot project. Each of these superintendents and their respective school boards have agreed to take the bold step of testing every junior in their district on Wednesday, April 22. These eight districts have a combined enrollment of approximately 15,000 juniors.
Over the next three months, you will hear more about this pilot project and the test results. Just a quick thought, if you are the parent of a junior not in one of the eight pilot districts, encourage your child to take the ACT or SAT college entrance exam. There is very little downside to taking the exam and huge upside potential. Click on the links below to get to the right website.
ACT Exam SAT Exam
ACT/SAT 2007
ACT vs SAT 2008
Monday, February 2, 2009
What's on tap for the week of February 2, 2009
The House Education Committee will be busy with several tasks this week.
-Education Committee Meeting on Monday the 2nd. Four bills are being heard.
-Early conversations will begin this week to discuss how a federal stimulus plan for education would be handled. As of today we still do not know when it is coming, how much is involved, what period it is for, what strings are attached, etc. We do know that something is coming but that is all.
-Beginning this week, we will also start working on a 2010 budget for education. We will be meeting with dozens of groups across the state over the next few weeks getting input and suggestions.
-Education Committee Meeting on Monday the 2nd. Four bills are being heard.
-Early conversations will begin this week to discuss how a federal stimulus plan for education would be handled. As of today we still do not know when it is coming, how much is involved, what period it is for, what strings are attached, etc. We do know that something is coming but that is all.
-Beginning this week, we will also start working on a 2010 budget for education. We will be meeting with dozens of groups across the state over the next few weeks getting input and suggestions.
Thursday, January 29, 2009
Is There a Federal Bailout for Education?
With the intense conversations revolving around the Arizona budget fix, several rumors have begun to circulate about a federal bailout package for Arizona education. The purpose of this website is to provide accurate, timely information.
Is there a federal bailout coming? Based on national news reports, there is a large state stimulus program that has passed the US House and is being presented to the Senate Appropriations and Finance Committee. It will be presented before the entire US Senate shortly. We know that there is a piece for education, but we do not know the following:
1) What amendments the US Senate will add?
2) How large the financial package will be?
3) When the money will arrive?
4) What strings will be attached?
5) Whether it is for school year 2009 or 2010?
As we learn more, we will update this site accordingly. The National Conference of State Legislatures (non-partisan) has a great website at http://www.ncsl.org/statefed/2009economicstimulus.htm that provides daily updates of the progress of the Economic Stimulus package.
Is there a federal bailout coming? Based on national news reports, there is a large state stimulus program that has passed the US House and is being presented to the Senate Appropriations and Finance Committee. It will be presented before the entire US Senate shortly. We know that there is a piece for education, but we do not know the following:
1) What amendments the US Senate will add?
2) How large the financial package will be?
3) When the money will arrive?
4) What strings will be attached?
5) Whether it is for school year 2009 or 2010?
As we learn more, we will update this site accordingly. The National Conference of State Legislatures (non-partisan) has a great website at http://www.ncsl.org/statefed/2009economicstimulus.htm that provides daily updates of the progress of the Economic Stimulus package.
Welcome to the House Education Website
We are pleased to roll out the official website of the Arizona House of Representatives Education Committee. The Committee is comprised of ten members, six Republicans and four Democrats. We are very fortunate this year to have experienced legislators and experienced school board members on the Education Committee. In addition, the staff supporting the Committee is also experienced in Arizona education policy.
One of the primary reasons for the launching of EducateAZ.org is to provide the citizens of Arizona, the education community and all other interested parties a place to come for accurate, timely information regarding the activities of the Committee. During session, legislation and budget discussions happen very quickly. Because of the short timeframes involved and the many steps required for legislation and budget adoption, there is often a great deal of misinformation that is inadvertently shared and spread around.
Our goal as legislators and staff is to keep this site up to date as much as possible to create a transparent legislative process. In addition, within each blog there is a way to make comments. We continue to be impressed with the suggestions offered by educators and the public with regards to furthering education in Arizona. We welcome and encourage your feedback and suggestions. All we ask is that you be respectful with your comments, always being mindful that we are also parents who care deeply about Arizona education. In return, we promise to also be respectful and courteous knowing that our authority only comes from you. Of course we reserve the right to remove inappropriate comments, but we hope to never have to do this.With that, we invite you to check back often for news and updates.
One of the primary reasons for the launching of EducateAZ.org is to provide the citizens of Arizona, the education community and all other interested parties a place to come for accurate, timely information regarding the activities of the Committee. During session, legislation and budget discussions happen very quickly. Because of the short timeframes involved and the many steps required for legislation and budget adoption, there is often a great deal of misinformation that is inadvertently shared and spread around.
Our goal as legislators and staff is to keep this site up to date as much as possible to create a transparent legislative process. In addition, within each blog there is a way to make comments. We continue to be impressed with the suggestions offered by educators and the public with regards to furthering education in Arizona. We welcome and encourage your feedback and suggestions. All we ask is that you be respectful with your comments, always being mindful that we are also parents who care deeply about Arizona education. In return, we promise to also be respectful and courteous knowing that our authority only comes from you. Of course we reserve the right to remove inappropriate comments, but we hope to never have to do this.With that, we invite you to check back often for news and updates.
School Tax Credits - The Great Divide
Many people have asked if school tax credits, primarily the $400 Extra Curricular Activities credit and the Private School Tuition credit of $1,000, are on the chopping block for 2010 (they were not an option for 2009 because of the late notice and short period left). These credits redirect Arizona tax collections for specific purposes as determined by the donor. Many of your after-school programs, field trips, music and sports activities are funded by ECA contributions.
In 2007, the ECA tax credit generated approximately $44 million and the Private Tuition credit generated approximately $63.8 million. Schools have come to depend on tax credits to fund numerous programs. In the world of school finance, tax credits are about the only funding source prioritized by parents, not the legislature, school district or teachers.
And there lies the problem. The Arizona Education Association and the Arizona School Board Association would like to see a temporary suspension of school tax credits so that those funds could be sent directly to the classroom. However, thousands of teachers, including many AEA members, and hundreds of school board members, almost all belonging to the ASBA, oppose restrictions to school tax credits. So what would King Solomon do?Given our financial situation, there will most likely not be any expansion of school tax credits, although there are three bills pushing for that. However, if any of the bills restricts the use of tax credits in one area than it may be possible to expand them in another, keeping the net effect the same. Keep your eyes open for more information.
In 2007, the ECA tax credit generated approximately $44 million and the Private Tuition credit generated approximately $63.8 million. Schools have come to depend on tax credits to fund numerous programs. In the world of school finance, tax credits are about the only funding source prioritized by parents, not the legislature, school district or teachers.
And there lies the problem. The Arizona Education Association and the Arizona School Board Association would like to see a temporary suspension of school tax credits so that those funds could be sent directly to the classroom. However, thousands of teachers, including many AEA members, and hundreds of school board members, almost all belonging to the ASBA, oppose restrictions to school tax credits. So what would King Solomon do?Given our financial situation, there will most likely not be any expansion of school tax credits, although there are three bills pushing for that. However, if any of the bills restricts the use of tax credits in one area than it may be possible to expand them in another, keeping the net effect the same. Keep your eyes open for more information.
What's the story behind the 2009 Budget Fix?
Late last night, January 28, 2009, the Arizona House and Senate worked out their differences to address the $1.6 billion deficit for the current year. Some interesting things took place in those last few hours that affected K-12 Education.
Within the Arizona Constitution, there is a formula that determines how much schools can spend each year. It is called the Constitutional Aggregate Expenditure Limit (CEL). This has been in place for years. When the legislature began funding All-Day Kindergarten a few years back, the formula was never adjusted to count kindergartners as full time students, only half day (there are many reasons political and ideological for why this is so but that is a discussion for another day). Because of this, schools have found themselves with more funding than they are allowed to spend. It takes a two thirds vote (40 in the House, 20 in the Senate) to allow schools to exceed this constitutional limit.
For the past four years, the legislature has voted to allow schools to exceed this limit. The vote has always been close; but, it has always passed. Last Thursday, the bill to allow this to happen passed the Arizona House Education Committee 10-0. Schools are expected to exceed the CEL by approximately $98 million this year. If the bill does not pass by March 1st, schools are required to adjust their budgets downward by the end of March. For example, within the Mesa School District, this amounts to approximately $7 million.
Senate President Bob Burns has a good understanding of where each of his members stands on the CEL. He knew he didn't have the votes to get it passed this year given the sorry state of our finances. So, as part of the final negotiations, President Burns asked that the CEL not be sent to the Senate because he knew it wouldn't pass. Because it reduces budgets by $98 million, it contributes to a solution for the huge deficit, but it is a cut to K-12. The Senate and House Appropriation Chairs had originally proposed a $103 million cut to K-12 primarily from soft capital (money used for textbooks, furniture, computers, etc.). It would be a double hit to not pass the CEL and to take $103 million, so something had to be proposed.
So here is where the final numbers ended up...
1) No passage of the CEL this year (reduces budgets by approximately 1.7% for school districts)
2) Hold harmless provision for the small districts in Arizona (under 600 students) on the CEL.
3) $4 million reduction to charter schools since they are not subject to the CEL
4) Reduction in soft capital of $21 million (we pushed for zero but given that the CEL is comprised of local and state money and the cash is actually saved in 2010 - a little complicated - we didn't win). This also has a hold harmless for small districts.
5) Reduction of $8 million at the ADE and an additional savings of $2 million by eliminating a recently introduced math and science initiative.
6) One of the policy changes we wanted for the next five months was to remove the strings from "soft capital" funding to provide ultimate flexibility to districts. Any soft capital remaining can be used wherever it is needed.
Within the Arizona Constitution, there is a formula that determines how much schools can spend each year. It is called the Constitutional Aggregate Expenditure Limit (CEL). This has been in place for years. When the legislature began funding All-Day Kindergarten a few years back, the formula was never adjusted to count kindergartners as full time students, only half day (there are many reasons political and ideological for why this is so but that is a discussion for another day). Because of this, schools have found themselves with more funding than they are allowed to spend. It takes a two thirds vote (40 in the House, 20 in the Senate) to allow schools to exceed this constitutional limit.
For the past four years, the legislature has voted to allow schools to exceed this limit. The vote has always been close; but, it has always passed. Last Thursday, the bill to allow this to happen passed the Arizona House Education Committee 10-0. Schools are expected to exceed the CEL by approximately $98 million this year. If the bill does not pass by March 1st, schools are required to adjust their budgets downward by the end of March. For example, within the Mesa School District, this amounts to approximately $7 million.
Senate President Bob Burns has a good understanding of where each of his members stands on the CEL. He knew he didn't have the votes to get it passed this year given the sorry state of our finances. So, as part of the final negotiations, President Burns asked that the CEL not be sent to the Senate because he knew it wouldn't pass. Because it reduces budgets by $98 million, it contributes to a solution for the huge deficit, but it is a cut to K-12. The Senate and House Appropriation Chairs had originally proposed a $103 million cut to K-12 primarily from soft capital (money used for textbooks, furniture, computers, etc.). It would be a double hit to not pass the CEL and to take $103 million, so something had to be proposed.
So here is where the final numbers ended up...
1) No passage of the CEL this year (reduces budgets by approximately 1.7% for school districts)
2) Hold harmless provision for the small districts in Arizona (under 600 students) on the CEL.
3) $4 million reduction to charter schools since they are not subject to the CEL
4) Reduction in soft capital of $21 million (we pushed for zero but given that the CEL is comprised of local and state money and the cash is actually saved in 2010 - a little complicated - we didn't win). This also has a hold harmless for small districts.
5) Reduction of $8 million at the ADE and an additional savings of $2 million by eliminating a recently introduced math and science initiative.
6) One of the policy changes we wanted for the next five months was to remove the strings from "soft capital" funding to provide ultimate flexibility to districts. Any soft capital remaining can be used wherever it is needed.
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