Looking ahead

Seven education storylines to watch as the Colorado General Assembly gets to work

PHOTO: Denver Post File
Then state Rep. Kevin Priola, R-Henderson, on the House floor in 2015. Priola was elected to the state Senate and will serve on that chamber's education committee.

As Colorado lawmakers return to the Capitol on Wednesday to begin crafting education policy and setting spending priorities, they face significant budget challenges, an uncertain transition in Washington and a growing chorus of educators fatigued by change.

The topics lawmakers are expected to address — including testing, school accountability and funding — are familiar. But the nation’s new education law, the Every Student Succeeds Act, and the likelihood the Trump administration will relax regulations in public education could provide lawmakers with new opportunities to rethink the state’s own education laws.

Still, how the state funds its schools is likely to take up the most oxygen, lawmakers and Capitol observers agree. Economic forecasts since June have shifted, creating a moving target for budget drafters. As of December, the economy was rosier — but classrooms still could see cuts because of Colorado’s complicated tax laws.

How the state’s education landscape looks four months from now when the legislature adjourns is anyone’s guess. In the past, the state has been recognized for both being on the forefront of education reform and for spending so little on students.

It’s been an epicenter in the debate over standardized tests, but avoided a showdown over academic standards that establish what students are expected to know at each grade level.

Lawmakers and observers agree that substantial changes this session are unlikely. But a foundation could be laid for bigger changes in 2018.

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The status quo — at least for another year — would be welcomed by school leaders who have spent nearly a decade putting in place education reform efforts ranging from literacy requirements for young students to updated graduation guidelines.

“A year with fewer education bills would really be a great year,” said Diane Doney, Littleton Public Schools’ chief financial officer and president of the Colorado Association of School Executives. “But I would love to see the funding figured out.”

Here are seven storylines we’ll be watching this year based on more than a dozen interviews with lawmakers and Capitol observers:

State Reps. Bob Rankin and Millie Hamner want to transform the way the state funds its schools.

Last session, Rankin, a Carbondale Republican, and Hamner, a Democrat from Frisco, hosted several unofficial study sessions to discuss school finance. That work carried over through the summer in private conversations with a diverse group of lawmakers including state Reps. Brittany Pettersen, a Lakewood Democrat, and Jim Wilson, a Salida Republican, and state Sen. Owen Hill, a Colorado Springs Republican.

While they’re not quite ready to introduce legislation on opening day, two concepts are in play.

The first would be a bill, which has not been drafted yet, that would ask voters to reset a statewide tax rate, known as mills, on property. Currently, every county and school district taxes personal and business property at varying rates. Some school districts like Weld earn large sums from their local property taxes, while others like Fountain gain very little.

Sen. Andy Kerr, Rep. Millie Hamner and then-Rep. Kevin Priola discussed the 2016 session at a Chalkbeat event. (Nicholas Garcia/Chalkbeat).

A combination of constitutional amendments and state statutes leave school districts powerless in setting their tax rate. The effect has been the portion of local tax dollars put toward school funding has shrunk and the state has had to increase its share in per pupil funding.

Rankin and Hamner have yet to decide what the new tax rate would be.

They face a difficult path. In an interview, Hamner said she wants the Joint Budget Committee to sponsor the bill that would refer the measure to the ballot. That would require unanimous support from all six members. If the budget committee agrees to sponsor the bill, it would need to win support from two-thirds of both chambers.

So far, neither Senate nor House leadership has given much thought to the proposal, which was first discussed at a Joint Budget Committee meeting in December.

Hamner and Rankin’s second concept would set up a committee and hire a third party to establish a new long-term vision for Colorado’s education system, including what modern classrooms should look like and how they should be paid for. Colorado currently funds its schools based on a formula written in the 1990s.

“The leadership has to come from the legislature,” Rankin said.

Rankin and Hamner are currently working with legislative legal services’ deputy director, Julie Pelegrin, who has helped draft most of the state’s education laws since the 1990s, on their bill. They’re also lobbying their peers to shore up support before they introduce anything.

“It’s very delicate,” Hamner said. “We want to make sure when we do introduce a bill, it has a lot of support from the very beginning, or else it could be destined for failure.”

It’s probably going to take a lot of creative accounting to keep cuts from schools.

Back in November, Gov. John Hickenlooper, a Democrat, proposed a slight increase in per pupil funding while still increasing the school funding shortfall, known as the negative factor, by about $46 million.

In December, the state learned that the economy was doing better than expected, it might have to issue refunds to taxpayers, and that the state was going to have to lower the personal property tax rate to meet a constitutionally required ratio with business property taxes.

Bottom line: lawmakers are going to have to make some very difficult decisions.

“I’m so depressed because of our situation,” Hamner said. “Unless we can reach some bipartisan agreement of how we think about the refunds, I think we’re going to have a really tough budget year.”

The biggest policy fight will likely be over charter school funding — though the outcome seems clear.

Hill, chairman of the Senate Education Committee, is ready to bring a proposal to require that local school districts share voter-approved tax increases with their charter schools.

While his proposal last year had bipartisan support in the Senate, House Democrats spiked it at a committee hearing.

With similarly split chambers this year, the same fate all but certainly awaits Hill’s bill.

Several lawmakers are ready to rethink ninth-grade testing. And they might have a way to convince the governor to support their plan.

Two years ago when lawmakers first took on revamping the state’s testing system, there was disagreement about whether to eliminate ninth-grade testing. But Hickenlooper insisted on keeping the tests and his veto power ensured they would remain.

PHOTO: Helen H. Richardson/The Denver Post
Colorado Gov. John Hickenlooper at his 2016 State of the State Address.

Lawmakers are anxious to test whether might Hickenlooper might budge when pressed again.

One of the first education-related bills you can expect to see introduced will be from state Sen. Nancy Todd, D-Aurora. While the details are still being worked out, Todd’s bill would provide some flexibility around ninth-grade testing.

Currently, ninth graders are required to take the state’s PARCC English and math test. Todd’s bill would allow districts to choose between the PARCC test or administer an exam more aligned to a college entrance exam such as the SAT, which Colorado juniors will begin taking this year as their required test.

The nation’s new education law — and nominee for education secretary — are wild cards.

When lawmakers first heard about the Every Student Succeeds Act, the nation’s new federal law, they were gleeful. In their minds, Colorado would have full control of its own education system, with no interference from Washington.

Just over a year later, legislators aren’t so sure.

“I think part of what’s going on is that there is an effort to understand the freedoms that ESSA will give us, and the freedoms ESSA doesn’t give us,” said state Rep. Paul Lundeen, a Monument Republican.

Both parties are expressing caution.

“I think it’s important to take the opportunity to make our system better,” said Rep. Brittany Pettersen, a Democrat from Lakewood and chair of the House Education Committee. “But we have to do it responsibly — and that takes time.”

Just how long it will take lawmakers to start putting their ideas to paper is unclear. They’ll be taking some signals from new leadership in Washington. Next week, confirmation hearings will begin for President-elect Donald Trump’s pick for education secretary, Michigan billionaire and school choice advocate Betsy DeVos.

“I think we may see some big things,” said Lundeen, who plans on taking a very close look at the state’s accountability system. “There’s just not black letters on white paper yet.”

Is this the year rural schools get the flexibility they want? Rep. Jim Wilson hopes so.

One of the lawmakers who was most excited about the new federal education law was Rep. Jim Wilson, a Salida Republican. He’d hoped the new law would provide some relief for rural schools.

Wilson has regularly run bills trying to eliminate paperwork and provide flexibility for rural schools.

“If districts are doing well, why are they required to turn in the same reports with the same frequency?” he said, suggesting some schools shouldn’t have to file regular reports that track goals and progress.

Wilson and other Republicans also hope to make headway on the issue of teacher hiring. Teachers in Colorado are required to hold a license to teach. Some want to relax those rules for rural schools, where hiring a licensed teacher can be difficult.

“It’s always a battle,” Wilson said.

One possible logjam for rural flexibility is a proposal from the State Board of Education. The board hopes to find a sponsor to carry a bill that would put some limitations on waivers they grant. Currently, once the state grants a waiver from state law, the board cannot revoke it or review a school district’s progress. Members, at the least, want some sort of authority to check in on how the waivers are working in school districts.

The board has not found a sponsor for its proposed legislation.

Don’t expect too much help on the state’s teacher shortage.

Lawmakers on the state’s education committees are more than aware that the state is in a crunch. Colorado’s teacher prep programs aren’t producing enough teachers to replace the number of teachers retiring. That’s especially true for middle and high school math and science teachers. And rural schools are especially at risk of being short teachers.

PHOTO: Nicholas Garcia
Stanley Teacher Prep resident Lily Wool works with kindergartner Samori McIntosh at Tollgate Elementary School in Aurora. Wood’s residency program is merging the Boettcher Teacher Residency program.

Remedies are not quick to come, though.

There’s the usual talk about rewriting the state’s teacher evaluation law. The law requires teachers to be evaluated every year, and 50 percent of the evaluation must be based on students’ academic growth.

And some unfinished business on Hickenlooper’s agenda includes reforming the state’s teacher licensing process. For teachers to obtain a license, they must pass a series of tests. The law governing teacher licenses hasn’t been updated since the 1990s.

But whether there’s a compromise to be found between Hickenlooper and different camps of lawmakers — those supported by the state’s teachers union and those supported by education reform groups — is the big question.

Todd, the Democrat from Aurora, is a former teacher. She agrees that teacher prep programs need to be updated. But, she said, “My hope is that when we talk about teacher evaluations, quality of teachers, preparation of teachers, that all of those things are really strengthening the individual to go into the classroom and make them successful.”

The perennial debate

How the heck does Colorado fund its schools? (And six other money questions you might be embarrassed to ask.)

PHOTO: Nicholas Garcia
A high school student at Vista Peak Preparatory works on a computer during an engineering class.

Since public schools were founded, arguments have raged over how to pay for them.

In Colorado, it’s one of the perennial debates that gets the best of lawmakers, lobbyists, school leaders and advocates every year. Further frustrating things, lawmakers can only do so much because constitutional amendments lock in much of the state’s budget.

It’s no chump change: More than $6 billion in Colorado tax money goes toward schools.

As Colorado lawmakers get to work on crafting the state budget, here are some questions and answers about how the school funding system works in the Centennial state.

How the heck does Colorado fund its schools?

Colorado funds its schools from two major sources of revenue.

The first pool of revenue is called the “local share.” This money comes from local property taxes on homes and businesses. The second pool is the “state share.” This revenue comes from income and sales taxes.

PHOTO: Sarah Glen
Over time, the state has had to increase its contribution to the state’s schools.

Historically, schools received about an equal share of their funding from the local and state shares. However, for a variety of reasons, the state has had to dramatically increase its contribution to schools during the last two decades.

Many schools, especially those that serve large populations of at-risk students, also receive federal money.

What about marijuana taxes? Aren’t schools seeing a windfall from recreational sales?

No.

The first $40 million of tax revenue collected from marijuana excise taxes — a wholesale tax — goes to a special fund to help school construction. That doesn’t go very far.

However, given a tightening state budget, Gov. John Hickenlooper has suggested increasing taxes on pot to help fund school operations. Lawmakers haven’t been keen on that idea.

Does every school district get the same amount from the state?

No. Lawmakers use a funding formula to determine how much money each school district gets. The formula, which was written in 1994, takes in a variety of factors including student enrollment, the district’s cost of living and how many at-risk students the district serves.

The large suburban district in Douglas County received $7,050 per student this year. Thirty-four percent came from local taxes, while the state picked up 66 percent of the cost.

The smaller Mapleton school district in Adams County, which serves a large Latino population, got $7,303 per student. But only 24 percent came from local property taxes, while the state kicked in 76 percent of the cost.

The tiny Aguilar school district in southeastern Colorado received $13,600 per student. The locals pitched in 25 percent and the state took care of the rest.

What determines the size of the local share?

School boards have no say in how much local property taxes contribute to their funding. That’s left to a complicated constellation of constitutional amendments and state law.

First there’s the Gallagher Amendment. Adopted in 1982, the amendment requires the state to maintain a 45 percent to 55 percent ratio ratio between the revenue collected from personal property and business property. When home values go up, the state is required to drop the percent on which property can be taxed. In 1980, the rate was 21 percent. In 2013, it was 7.98 percent. That means a smaller proportion of a home’s actual value can be taxed by school districts.

The second constitutional amendment in play is the Taxpayer’s Bill of Rights, or TABOR. Approved by voters in 1992, TABOR puts a cap on how much revenue the state and local governments can collect from taxpayers. It also requires governing bodies to seek permission from voters before increasing taxes.

While all but four school districts have received voter approval to keep excess tax revenue, lawmakers have put two key restrictions on school districts.

First, school district property taxes can only increase by inflation and enrollment growth. When that revenue exceeds the limit, school districts must reduce their tax rates. And because of TABOR, once the tax rate is lowered by statute, it can’t be raised without voter approval.

(If you want to sound super-smart at your next PTA or school board meeting, this is known as the “ratchet effect.”)

Lawmakers put an additional check on school districts in 2007 when they put a statewide cap on school districts’ tax rates.

What determines how much the state is supposed to kick in?

While there are two amendments that put restrictions on how the state can generate revenue to fund its schools, there is another Constitutional amendment that spells out how the state is supposed to spend that money.

Amendment 23, approved by voters in 2000, did a few things, but two points are still relevant today.

First, Amendment 23 requires the state to increase funding based on population growth and inflation. Second, it created the State Education Fund, an account lawmakers are relying on more heavily to pay for schools. It is financed by one-third of 1 percent of federal taxable income that is exempt from TABOR limits.

Wait, if lawmakers are required to increase funding each year, why does the state have an education funding shortfall?

During the Great Recession, when lawmakers were forced to slash hundreds of millions from the state budget, they argued that Amendment 23 only covers “base funding,” or the average every school district receives per pupil.

The amendment, they argued, doesn’t govern the additional money districts receive to compensate for size, at-risk students and other factors.

So in 2010, lawmakers created “the negative factor,” a new tool they could use to make across- the-board cuts to school funding after all other factors (size, at-risk students, cost-of-living) are taken into consideration.

As part of a compromise, lawmakers are required to report how much money they’re not giving to schools based on that legislative tool.

A lawsuit challenged the negative factor. But the state Supreme Court ruled in favor of lawmakers.

So while a large portion of funding must increase every year, lawmakers have places to cut education in a pinch. The current shortfall is at $828 million, down from a $1.01 billion in 2013.

Didn’t a bunch of school districts just pass tax increases?

Yes, and according to some, that’s making the situation worse.

As the state’s finances have squeezed, some school districts have turned to local voters to ask for more local revenue. These tax increases, known as mill levy overrides, exist outside of the state’s school funding system. The more voters approve doesn’t lessen the state’s burden.

There are some school districts like Boulder, Denver and Cherry Creek that have generated millions of local revenue but are still getting their equal share from the state. Meanwhile, districts like Greeley, Pueblo and Sheridan have never been able to convince their voters to approve a tax increase. That means they have to get by with whatever the state gives them.

Not ready for prime time

Lawmaker kills bill that would have allowed unlicensed teachers in rural Colorado classrooms

A bill that would have allowed understaffed rural Colorado school districts to hire unlicensed teachers was spiked by its sponsor after he was unable to find enough support.

“I’ve gotten a lot of flack over it, and it’s not ready for prime time,” said Rep. Jim Wilson, a Salida Republican. “If your troops are still arguing, I’m not dumb enough to lead the charge.”

Along with providing flexibility on hiring unlicensed teachers, House Bill 1178 would have created a process for rural schools to receive waivers from state law.

The State Board of Education, which is responsible for granting waivers, and the Colorado Education Association, the state’s largest teachers union, criticized the bill.

The union is a stalwart defender of the state’s licensure policies and objects to allowing unlicensed teachers in the classroom.

Wilson took a shot at the objections.

“My question is: Who is going to be concerned between unlicensed educators versus no educators?” he said. “There’s no easy simple solution to going out and finding (licensed teachers). They’re not there. I’ve never seen this kind of crisis — ever.”

State lawmakers are considering two other bills to address the shortage of teachers, which is concentrated in certain geographic areas and subjects.

On Monday, the House Education Committee on a party-line vote approved a bill that calls for the state’s education and higher education departments to create a strategic plan on the issue.

Lawmakers are also considering a bill that would grant rural school districts more flexibility in hiring retired teachers.