Saturday, January 31, 2015

First Month is a Wrap!  This marks the end of the first month of the 2015 legislative session and there haven't been many, if any, surprises thus far.  Both sides of the street have been mapping out their policy territory and it's way too early to tell where most of the battle lines will be drawn.  I think it's safe to say that the dueling visions of transportation funding (Governor with gas tax increase and more ambitious and comprehensive set of proposed improvements versus a House package with no tax increase and by extension a smaller scale proposal) will be among the toughest nuts to crack at session's end.  It has been relatively quiet in most other areas as the Legislature is now poring through the Governor's budget to try and get a stronger handle on what he is proposing and how that fits with their particular visions in the session ahead.

On education,the Governor went in big on early education.  The details are still being unpacked, but it appears the Governor has put a significant amount of increased support into the early childhood scholarship program and providing 4-year-olds with a student "weight" to provide interested districts with a revenue stream to provide universal voluntary pre-school to their residents.  The proposal is not without controversy and the debate may get contentious at some point.  First, funding for the proposal has come at the expense of support for the general education basic formula.  Along with the increase in the projected base increase in the E-12 budget of over $200 million, the Governor has added $392 million.  But out of this $392 million, less than half will be going toward the primary funding engine of the E-12 system:  the general education formula basic amount, which only receives a 1% increase in each year of the biennium under the Governor's budget.  As expected, this is not sitting well with the K-12 community and testimony taken in the House last week bears that out clearly.  There is no question that districts throughout the state will be cutting their budget--some of them significantly--if the basic formula doesn't receive additional support by the time the session ends.

The Governor's budget proposal also overlooks the recommendations of the School Facilities Funding Working Group and the more recent task force that was charged with melding the alternative compensation (QComp) program with the more recently enacted Teacher Development and Evaluation program.  About half the districts in the state are participating in the alternative compensation program and while it will not be easy for a number of these districts to seamlessly incorporate the requirements of the Teacher Development and Evaluation law into their systems, it will likely be easier for alternative compensation districts to accommodate any additional costs that may result from the new direction than it will be in districts that do not have a revenue stream to shoulder these costs.  The price tag for providing non-alternative compensation districts to receive the state aid portion of the alternative compensation formula is gauged to be around $100 million.

As in the case of the Teacher Development and Evaluation program, the Governor chose not to put any money into the suggested improvements for facilities funding contained in the School Facilities Finance Working Group that met in the summer of 2013.  The price tag on the first step toward full implementation of that panel's report would be approximately $200 million for the second year of the biennium.  This state aid entitlement would come both in the form of new revenue and property tax relief through increased debt service and equalization of levies that currently are not equalized or equalized at a very low rate.

One of the frustrations I am having is that these two task forces (along with the more comprehensive education finance working group that met in 2011) have been largely ignored.  All three of these fora have provided a tremendous amount of insight and evidence that Minnesota's education funding framework is in need of more than just some sprucing up around the edges.  SEE was one of the prime movers in the PS Minnesota/New Minnesota Miracle efforts that called for a massive infusion of revenue into the education funding system to make up for the underfunding that had been occurring since the 1990s.  Unfortunately, the downturn in the economy that crippled state finances at the end of last decade prevented the kind of investment that was needed to put the state back on track in this regard.  And while there may be more will to move forward now, it's not like the state (and national) economic picture has improved sufficiently to create the revenue stream significant enough to reach the ambitious goals set out by PS Minnesota/New Minnesota Miracle.

I don't think anyone is expecting a massive infusion beyond what the Governor has suggested and it's probably not possible given the budget constraints and economic uncertainty.  But it would be nice if a nod were given to some of the impressive work that the Minnesota Department of Education has undertaken in the various work groups it has convened over the past four years.

Speaking of Money in Education.  For those of you not familiar with Dr. Bruce Baker, he is an education finance expert and Professor of Educational Theory, Policy, and Administration in the Graduate School of Education at Rutgers (New Jersey) University.  Dr. Baker has testified in a number of high-profile adequacy lawsuits throughout the nation and is generally recognized as one of the stronger voices for increased funding for education.  Dr. Baker has a blog entitled School Finance 101 and a great number of his posts make a compelling case for increased funding for K-12 education.  Below is one of Baker's recent entries on why money matters (contrary to the opinion of a number of education reformers).

School Finance 101:

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