Rural aid package, including $400 million for rural schools, advances in Colorado Senate

PHOTO: Kevin J. Beaty/Denverite
State Sen. Jerry Sonnenberg, a Republican from Sterling, on the first day of the legislative session.

A bipartisan legislative package that would provide much-needed financial relief to Colorado’s rural schools, roads and hospitals has cleared its first legislative hurdle.

The Senate Finance Committee voted 4-1 Tuesday to advance Senate Bill 267, even as multiple members on the panel voiced frustration with the bill and threatened to withdraw their support if key provisions are meddled with.

The bill, which would send nearly $400 million to rural schools during the next three years, is controversial in part because it depends on the legislature reclassifying a fee paid by hospital patients.

Currently, the hospital fee is sent to the state’s general fund. The money is used to match federal funds to help hospitals pay for services. That general fund is subject to the spending limits in the state’s Taxpayer Bill of Rights, or TABOR. Since 2015, the fee has pushed the state near or above its spending limit and has triggered taxpayer refunds.

If the state moves that fee from the general fund to an enterprise account, the money collected from hospitals wouldn’t be subject to TABOR restrictions.

Changing how the state designates the fee has been a priority for Democrats. But Republican lawmakers have suggested the idea would be unconstitutional.

Republicans are changing their tune this year as some rural hospitals face massive cuts or closure after the state budget committee limited how much the state could collect from the fee.

“Let’s figure out what that fine line is where we can get a compromise to address a number of these problems,” said state Sen. Jerry Sonnenberg, a Sterling Republican and one of the bill’s sponsors.

Even with enough votes to get out of the Republican-controlled Senate — something unimaginable just a few months ago — the bill’s fate remains uncertain.

Democrats in the House want a key provision of the bill changed. The bill, as drafted, requires the state to lower how much money it’s allowed to spend by about $600 million. Democrats in the House want to keep the spending limit where it is to allow more flexibility in the state budget.

Republican state Sen. Owen Hill, a member of the finance committee and a supporter of the bill, said sponsors would lose his support if Democrats overreached.

He called lowering the legislature’s spending limit “the lynchpin” of the bill.

Earlier this week, Sonnenberg said he’d allow the bill to die if Democrats touch that portion of the bill.

State Sen. Tim Neville, the lone Republican who opposed the bill Tuesday, acknowledged the problems facing rural Colorado.

“I wish I could say this is the solution to those problems, or even a good bandage,” he said of the bill. “However, it is not.”

During testimony, rural school superintendents and school board members outlined the financial hardships their schools face.

They said the financial support the state has provided since the Great Recession has not kept up with the costs of operating schools. Perhaps the greatest struggle, they said, is paying teachers a living salary.

“Frustrations are high amongst teachers,” said Rob Sanders, superintendent of the Merino school district. “Many are not only talking about retiring, many are retiring as soon as they can. We’re losing teachers to Target and Walmart.”

maybe next year

Senate Republicans kill bill that would have taken broad look at public education in Colorado

Students at Vista PEAK Exploratory in Aurora work on a math assignment. (Photo by Nic Garcia)

A Republican-controlled state Senate committee spiked a bill Wednesday that was meant to spark a broad conversation about the future of Colorado’s public schools.

Some lawmakers hoped House Bill 1287 would help sell voters on raising taxes to better fund the state’s schools. But the Senate State, Military and Veterans Affairs committee voted 3-2 along party lines to kill the legislation, which would have created a series of committees to examine the state’s education laws and make recommendations for changing them.

Republicans objected to the bill because they didn’t want to create more bureaucracy, and they thought it was a ploy to raise taxes.

The bill’s demise was a defeat for a group of the state’s most authoritative lawmakers on education policy. It was one of the top legislative priorities for state Reps. Millie Hamner, a Dillon Democrat, and Bob Rankin, a Carbondale Republican. Both serve of the state’s budget committee and rallied lawmakers around the bill.

Rankin called the bill the most important of his legislative career.

“I’m bitterly disappointed, although it was expected,” he said. “I certainly don’t intend to give up. We’ve worked for over three years to move this idea forward. We thought we built a bipartisan coalition that was interested and wanted to help. We thought we were making really good progress.”

Hamner also expressed dismay over the bill’s death.

“To die quietly like that in Senate was really, really surprising and disappointing,” Hamner said. “Do we still have a need to establish a vision for the future of our kids? Yes. Apparently we’re going to have to do that without our Senate majority.”

Last-minute amendments brought by state Sen. Kevin Priola, a Henderson Republican, to address Senate GOP leadership’s concerns could not save the bill.

Supporters of the bill said the legislature needed to step in to help rethink Colorado’s education landscape holistically, not with piecemeal legislation. The state’s laws are outdated and clash with 21st century expectations, they said at Wednesday’s hearing.

“Our current collection of policies and laws have failed to keep pace with changes in expectations of our education system,” said Mark Sass, a Broomfield high school teacher and state director of a teacher fellowship program, Teach Plus. “We need a deliberate and collaborative conversation in our state, as to our vision of education.”

State Sen. Owen Hill, a Republican from Colorado Springs, said he supported the goal of the bill. His name was listed as a sponsor when the bill was first introduced. But he said he eventually concluded the bill was the wrong approach.

“I’m not sure this is the solution to get us there,” he said. “It’s time for us to take a bottom up approach. I get nervous about standing up and staffing and financing another government program.”

After the committee hearing, Sass said Republican lawmakers failed to realize their unique role in Colorado shaping statewide education policy. The state’s constitution gives no authority to the governor, the education commissioner or the State Board of Education to create a strategic plan.

“We need someone to drive this conversation,” he said. “If the legislature won’t, who will?”

Priola said in an interview that he had hoped for more time to lobby Senate leadership and members of the committee. Instead, he said he’d try again next year.

“We live in a state with 178 school districts and thousands of schools,” he said. “There can’t be one way of doing things, but there also can’t be 1,000. There has to be some commonality on what we’re doing and what direction we’re heading.”

Rankin was less committed in trying again next year.

“I want to think about,” he said. “I don’t think this elected, term-limited legislature with the background they come from can develop the kind of leadership needed for this movement.”

The death of House Bill 1287 puts another bipartisan piece of legislation on shaky ground.

House Bill 1340, sponsored by state Reps. Alec Garnett, a Denver Democrat, and Paul Lundeen, a Monument Republican, would create a committee of lawmakers to study and make changes to the way Colorado funds its schools.

The state House of Representatives was expected to hold its final vote on that bill Wednesday morning. But Democratic leadership pushed the vote by a day.

Some Democrats in the House saw the two bills as a package, while Republicans in the Senate saw them as competing. With partisan rancor flaring in the waning days of the session, House Democrats could return the favor and kill the finance study bill.

Rankin, the House Republican, said he hoped his chamber’s leadership would let the finance study bill move forward. He introduced a similar bill two years ago but was unable to get the bill through the legislative process.

“I think it’s a good idea to take a hard look at school finance. Maybe we can get some dialogue going,” he said, adding that he believes lawmakers still need to think about a strategic plan for its schools.

Hamner, the House Democrat, said she also supported the finance study.

“I think their bill will be just fine,” she said. “Unless the Senate decides to kill it in State Affairs.”

the fiscal thicket

Everyone hates how Colorado funds its schools. So who is going to fix it?

Students at Manual High School work during class in 2013. (Photo by Marc Piscotty)

Glenn Gustafson, the chief financial officer for Colorado Springs District 11, has spent the past few months crisscrossing the state sharing his grave prediction about school funding to anyone who will listen.

His prognostication goes like this: It might not happen this year, or even in next two, but if something drastic doesn’t change, Colorado lawmakers will be forced to slash school funding to historically low levels.

“The system will implode,” he said in an interview.

What’s happening, Gustafson and others agree, is a slow-moving collision involving Colorado tax policy, growing inequities in public schools, and other spending priorities like state’s health insurance program and roads.

Multiple efforts to stave off a financial crisis for Colorado schools are under way, including legislation that would create a committee to develop a new way to fund schools. A cross-section of Colorado school superintendents also have been working behind the scenes to come up with their own method to fund schools. And a new coalition of education advocates is laying the groundwork for a potential 2018 ballot initiative that would send more money to schools.

How the three groups work together to solve one of the state’s thorniest questions is unclear — especially since some lawmakers staunchly oppose a state tax increase for schools. But representatives from each faction say they’re more hopeful than ever that changing the way Colorado funds its schools is possible, even if multiple past efforts have failed.

“We’ve gotten to a common place that everyone realizes what we have is not working,” said Charlotte Ciancio, superintendent of the Mapleton School District in Adams County. “We have multiple groups focusing on the problem and we’re all willing to see it from one another’s perspective.”

The perennial debate

The fight over school funding in Colorado — and across the nation — is not new. There have been multiple efforts here during the last decade to change the system, including legislative study sessions, lawsuits and ballot initiatives. All have failed.

Since the Great Recession, when the state was forced to cut spending dramatically, the debate has intensified. But lawmakers and school leaders have been unable to make any substantial changes.

What complicates the school-finance debate in Colorado is a series of constitutional amendments that restrict how much tax revenue the state can spend, how the state collects property taxes and what lawmakers must spend on schools.

The two most recent efforts to flush schools with cash were in 2013 and 2016.

Had Amendment 66 passed in 2013, it would have sent more than $1 billion to schools and triggered a major rewrite of the law that spells out how much each school district gets based on a variety of factors. Voters soundly rejected that ballot question.

Last year, efforts to build enough support to go to the ballot with another measure fizzled.

Recent legal challenges to how Colorado funds schools also have proven fruitless. In 2013, the Colorado Supreme Court ruled that Colorado’s funding system was adequate, but perhaps could be improved. And in 2016, the state’s highest court found a legislative tool to cut school funding was constitutional.

The state currently funds schools at a deficit of about $800 million. And according to multiple studies, Colorado as a state spends less on schools than most other states.

The formula

How much the state spends on its public schools is one question under scrutiny. How it divides the money is another — and just as contentious.

The formula that determines how much each school receives was written in 1994. Since then, the state has rolled out major reform efforts that include more rigorous standards and graduation requirements. The state’s student demographics have changed, too. Colorado now has more poorer students and students learning English as a second language.

“Education and opportunities are dramatically different today,” said state Rep. Paul Lundeen, a Monument Republican working to change the funding formula. “The funding formula affects how we deliver — in meaningful ways — those opportunities. It’s time to update.”

Lundeen, along with Denver Democrat state Rep. Alec Garnett, has introduced a bill that would establish a committee of 10 lawmakers charged with proposing legislation during the next two years. The bill grants the committee the authority to study and propose changes to tax policy and the formula that divides school funding.

“Coloradans fundamentally are telling the legislature, ‘Do better,’” Garnett said. “We shouldn’t be using a formula from 1994. We should be using a formula that reflects the realities of today.”

Politics over how much each school receives — or doesn’t — are sure to get in the way of policy, both lawmakers said. But they’re resolved to push through a compromise.

“It’s incumbent upon us to bridge the divide,” Lundeen said. “We go in with eyes wide open. We realize it’s going to be tough. But we need to do something.”

A coalition of Colorado superintendents are one step ahead of lawmakers. After meeting privately for three years, they are beginning to share their proposal to fund schools with advocacy groups and lawmakers.

The superintendents are calling for more money for students who are poor, learning English as a second language, are gifted and talented or have learning disabilities. While it does take into account the size and geography of the school, those are lesser factors.

Shifting the focus to student need instead of district characteristics is likely to win favor with lawmakers from both parties. But the price tag will be a likely roadblock. While the school chiefs haven’t added it all up, their formula could easily cost another $1 billion.

That’s likely a nonstarter for Republicans who are convinced the more than $6 billion the state spends on schools is enough.

Walt Cooper, superintendent of the Cheyenne Mountain School District in Colorado Springs, said the superintendents didn’t create the formula based on what they believe are students’ needs.

“It’s not how much money do we have to start with and how can we back into dividing that,” he said. “It’s really what is the amount needed to do the job we’re expected to do.”

Cooper said the superintendents aren’t living in a fantasy world.

“This is probably an approach and a model we’ll have to grow into over time,” he said.

A new campaign

While lawmakers are poised to debate how to slice the fiscal pie, a coalition of education advocacy groups is laying the groundwork to once again ask voters for more money.

Last week, the Colorado Education Network met for the first time in a ballroom on the University of Denver campus. The new organization is the first byproduct of ongoing conversations about a 2018 ballot question lead by Great Education Colorado, a 14-year-old nonprofit that advocates for school funding.

“Somebody else is not going to fix school funding,” Lisa Weil, executive director of Great Education Colorado, told the room of 250 parents, school leaders and school board members. “It has to be the grassroots to the rescue.”

In an interview, Weil said her organization and its partners haven’t settled on a strategy to increase school funding. But the network — which includes the Colorado Association of School Boards, Padres Unidos y Jovens and the Colorado Children’s Campaign — is a crucial first step.

“The mechanism and vehicles that move us forward have yet to be seen,” she said. “But we know we’re going to have to engage voters one way or the other to invest in schools.”