Back to the Blog. I haven't been making good on my promise to provide on-going commentary on the blog and I apologize for that. The only thing I can say is that I've been busier than jumper cables at a hillbilly wedding (sorry Jethro and Ellie Mae) and haven't had enough time to get my thoughts both straight and down on paper.
Senate Bill (Part One) It's not like there has not been anything happening. The Senate E-12 Omnibus Funding and Policy bill passed the Senate floor on Tuesday by a vote of 37-29. This bill is obviously not the most popular item passing through the Legislature this session as it seeks to cut approximately $1 billion from the E-12 budget (primarily through reductions in K-12 general education revenue).
The primary problem--and it is the primary problem by about six light years--is the overall cut to E-12 spending contained in the bill. The Senate leadership's approach this year has been one of truth-telling and it's hard not to charge the Administration (and the House to a lesser extent) with political and policy legerdemain in avoiding the short- and long-term budget issues faced by the state. We are looking at approximately a $4.6 billion revenue shortfall (actually around $6.4 billion if one take the federal stimulus revenue out of the equation) and one can argue (although we haven't seen the House's set of appropriations bills) that no really difficult decisions have been made by anyone other than the Senate. I am not going to laud their approach as I believe the cuts to education are unwise anyway one views them, but I also believe it is important to look at both the spending and revenue generation sides of the budget equation and the Senate, unlike the Governor (who chose to cut corporate taxes), has done that.
The other problem, not nearly as serious, but troublesome for a vast majority of SEE districts and clearly indicative of the larger education funding formula issues SEE has been studying over the last five years is the decision as to how the cuts would be administered. Many of you who attended the regional meetings may remember the handout that showed what a 10% (or thereabouts) cut to the general education basic formula would mean in terms of per pupil revenue in each district. Because the general education basic formula is tied to a number of other general education sub-formulas (particularly compensatory, sparsity, and transportation sparsity), that run showed those districts with high levels of any of those funding categories getting cut more than districts with lesser levels of the geographic and demographic characteristics that fuel the set of sub-formulas. Clear on that?
The prevalence of these characterstics create considerable--but justifiable--differences in the amount of state aid each district gets. Districts with higher numbers and building concentrations of students receiving free-and-reduced priced lunches and districts that are geographically isolated receive more--sometimes considerably more--in terms of per pupil revenue that districts that lack those characteristics. Because a vast majority of SEE districts are geographically relatively compact and have lower levels (at least in the pre-real estate meltdown era) of free-and-reduced price lunch students, they get lower levels of general education revenue. According to my trusty annual revenue rankings for the 2008-2009 school year, the average for SEE districts in terms of state formula general education revenue (not counting the referendum) is $282 per pupil unit below the state average. Although not applicable to this specific situation, it should be pointed out that when the referendum is added into the mix, the difference becomes $372 per pupil unit.
In applying the proposed reductions--a net of approximately $273 per pupil (approximately $236 per pupil unit) after a cut of $590 per pupil in state aid is "back-filled" by approximately $317 per pupil in federal stablization aid delivered by the stimulus package--the Senate, instead of making the reduction in a way that included the revenue from the general education sub-formulas, decided to "fence off" revenue delivered through compensatory, english language learning, sparsity, transportation sparsity, and equity (didn't want to leave this one out because I wanted to show everyone that, yes, even though our districts don't get a ton of consideration through these formula adjustments, we do get some) and protect that from any cuts. Instead, the reduction is a "back door" reduction in the general education revenue basic amount applied after all the formulas tied to the general education amount have been allowed to "run to completion."
Whether or not this is fair is up for debate. I can understand the rationale for protecting the funding categories before applying the overall reductions, but that doesn't mean I necessarily agree with all aspects of this approach. Because of how the proposed cuts are applied in the Senate bill, a district like Sauk Rapids-Rice (339th out of the state's 340 operating school districts) would be saddled with an additional cut over 4.2% from its general fund from its current budget projections. A district like South Koochiching, with the highest level of state-formula revenue in the state largely through sparsity, would reduce its general fund by an additional 2.4%, 1.8 percentage points less than in Sauk Rapids-Rice. Minneapolis, which receives its largest adjustment through compensator, would cut its general fund budget by approximately 2.9% (due in part to its referendum--which neither Sauk Rapids-Rice nor South Koochiching have).
I don't want to make it sound like Minneapolis and other districts with high levels of compensatory or sparsity revenue are the "lucky duckies" in the Senate bill. No one comes out well in this bill. But the Senate's application of these cuts kind of spurred me to action. I will describe the actions I took in reacting to this bill in Part II.