Point counter-point

Lawyers offer clashing views on Colorado school funding shortfall

The two sides in a key school funding case offered sharply different interpretations in oral arguments before the Colorado Supreme Court on Wednesday.

The lawyers’ cases were interrupted repeatedly by the justices trying to tease out the meaning of the lawyers’ arguments.

The arguments were a key step in a lawsuit named Dwyer v. State, which challenges the constitutionality of the formula that the legislature has used since 2010 to reduce annual K-12 support and balance the state budget.

Lawyer Sean Connelly, representing the plaintiffs, argued that the formula (known as the negative factor), was devised with “the sole intent of circumventing the plain language and intent of Amendment 23,” the constitutional amendment that governs school funding.

But Senior Assistant Attorney General Jonathan Fero, representing the state, argued that Amendment 23 has clear language requiring annual growth only in “base” school funding, not all K-12 support. The language “provides the only answer the court needs because its meaning is plain,” Fero said.

The two sides have different interpretations of such key terms as “base funding” and “per-student funding,” a gap alluded to by Justice Nathan Coats.

“Reading the two sets of briefs, it’s like two ships passing in the night,” Coats remarked.

The case has crucial implications for Colorado’s school funding system and the overall state budget.

A ruling in favor of the plaintiffs could mean hundreds of millions in additional school support in future years but a possible severe squeeze on other state programs, including higher education. High court rejection of the suit likely would set a “new normal” for K-12 funding and be a bitter disappointment for school districts.

At issue is the meaning of Amendment 23, the 2000 constitutional provision that requires annual K-12 spending increases based on inflation and enrollment growth.

In 2010, the legislature created the negative factor formula to control school spending as lawmakers struggled to balance the overall state budget. The legal reasoning behind the negative factor is that A23 applies only to base per-student funding, not to additional state funds districts receive to compensate for staff cost of living, size, number of at-risk students, and other factors.

Prior to the budget crisis brought on by the 2008 recession, the legislature calculated K-12 increases based on both base and factor funding.

Fero argued that Amendment 23’s definition of the base is clear, and “there can be no question what this language refers to.”

The plaintiffs argue that use of the negative factor is “a charade.” Connolly said, “We should win because the state’s premise is wrong.”

Timothy Macdonald, the second plaintiffs’ lawyer who spoke, said use of the negative factor “renders Amendment 23 a hoax.”

Connelly and Madonald argued that the actual effect of using the negative factor has been to cut base funding, not factor funding.

Fero stuck to his position, saying, “I think they are trying to overcomplicate the case.”

Coats summed up the back and forth by saying, “It’s a question of what the base consists of.”

Use of the negative factor has created an annual funding shortfalls of about $1 billion. Despite improving state revenues and district pressure on lawmakers, the legislature has been able to make only modest reductions in the negative factor. It’s pegged at $855 million for the 2015-2016 school year. School funding will be $6.24 billion next year, compared to $5.93 billion in the school year that ends June 30.

Background of the case

The suit was filed in June 2014 by a group of parents, school districts and education organizations. The lead plaintiffs are Lindi and Paul Dwyer, who have four daughters in the Kit Carson district, and the case takes their name. A Denver judge rejected the state’s motion to dismiss the suit last December, sending the case to the state’s Supreme Court.

In addition to Connelly and Macdonald, the plaintiffs are being represented by Boulder public interest lawyer Kathleen Gebhardt.

The Dwyer case has attracted several friend-of-the-briefs in both sides. Briefs supporting the plaintiffs have been filed by the Colorado Association of School Boards and the Colorado Education Association, among others. A brief supporting the state’s position was filed by several business groups, including the Denver Metro Chamber of Commerce.

There’s no set deadline for the seven-member high court to issue a ruling.

Dwyer is the second major school-funding case to reach the high court in two years.

In late May 2013 the court rejected plaintiffs’ claims in the long-running Lobato v. State suit, which was a much broader challenge to the state’s school funding system. (See Chalkbeat’s Lobato archive here.)

The court issued its Lobato ruling less than three months after hearing oral arguments.

Still walking

Colorado teachers plan more walkouts, and Jeffco canceled classes one day next week

Colorado teachers march around the state Capitol Monday, April 16, to call for more school funding and to protect their retirement benefits. (Erica Meltzer/Chalkbeat)

Teachers from Colorado’s two largest school districts are planning back-to-back walkouts next week to call for more funding for education – and they could be joined by other districts.

Jeffco Public Schools canceled classes for April 26, next Thursday, after many teachers there said they plan to go to the Capitol, while the union representing Denver classroom teachers said they plan to walk out midday April 27, next Friday, to rally at the Capitol early in the afternoon.

In a press release, the Denver Classroom Teachers Association said Denver teachers would be leading a statewide walkout. Corey Kern, the union’s deputy executive director, said he’s not sure yet how many other districts will be represented.

The announcements come after hundreds of teachers marched at the Capitol during a day of action Monday to protect their retirement benefits and call for more school funding. Enough teachers left the suburban Englewood district that classes were canceled there.

Colorado consistently ranks in the bottom tier for school funding and teacher pay, though there is considerable variation around the state. A recent study ranked Colorado last for the competitiveness of its teacher salaries, and nearly half the state’s districts are now on four-day weeks. The 2018-19 budget takes a big step toward restoring money cut during the Great Recession, but the state is still holding back $672 million from what it would have spent on K-12 education if it complied with constitutional requirements to increase per-pupil spending at least by inflation each year.

The wave of teacher activism reflects a national movement that has seen strikes, walkouts, and marches in West Virginia, Oklahoma, Arizona, and Kentucky. Unlike other states, lawmakers here can’t raise taxes to send more money to schools or approve teacher raises on their own. Voters would need to approve more money, and local school boards would need to increase salaries.

Teachers interviewed at Monday’s march said they recognize the fiscal constraints in Colorado, but they’re also inspired by the actions of their colleagues in more conservative states.

Many teachers also said they fear that reductions in retirement benefits could lead to an exodus of younger teachers, further squeezing a profession that struggles to recruit new workers and suffers from high turnover.

A House committee made changes to a pension overhaul this week that removed the provisions teachers found most objectionable, like raising the retirement age and making teachers pay more out of their paychecks, but the final form of the bill still needs to be hashed out between Democrats in the House and Republicans in the Senate.

Jason Glass, superintendent of the 85,000-student Jefferson County district, sent an email to parents Tuesday that said classes would be canceled next week due to a “labor shortage.” Teachers who miss school are required to use their allowed leave time.

Glass called the level of education funding in Colorado “problematic.”

“Public education staff, parents, and other supporters have become increasingly vocal in their advocacy for increased funding for our K-12 public schools and the stabilization” of the state pension plan, he wrote. “There is a belief among these groups that years of low funding is having a significant impact on our ability to attract quality candidates into the teaching profession, and is impeding the ability to effectively deliver the high level of educational experience our students deserve.”

Glass apologized for the “inconvenience” to families and reminded parents that April 26 is also “Take Our Daughters and Sons to Work Day.”

Denver Public Schools, the state’s largest district with 92,000 students, announced late Tuesday that there would be early dismissal April 27, with more details to come.

“Officials across the country and specifically lawmakers in the statehouse must finally recognize that a quality education cannot be provided on the cheap.” Denver union president Henry Roman said in a press release about the walkout. “If we want Colorado’s current economic prosperity to continue, we need to realize the importance of strong schools.”

Advocates are trying to place a $1.6 billion tax increase for education on the November ballot. Voters have twice rejected similar measures in recent years.

priorities

With school finance act, Colorado lawmakers try to pass the hot potato of teacher pay to local districts

State Rep. Barbara McLachlan, a Durango Democrat, calls for more money for education during a rally with teachers and fellow Democratic members of the House Education Committee at the Capitol Monday, April 16. (Erica Meltzer/Chalkbeat)

A school finance act that puts more money into K-12 education than Colorado has spent at any point since the Great Recession passed a key House committee Monday with easy bipartisan support.

Democratic lawmakers on the House Education Committee urged local school boards to turn this money into teacher raises – and Colorado voters to provide even more funds next year.

The hearing on the school finance act occurred as hundreds of teachers descended on the Capitol as part of a day of action to ask for more school funding and protections for retirement benefits. Before the hearing started, Democratic committee members met with teachers in the foyer of the Capitol and joined them in chants of “not enough” and “no more B.S.,” a reference to the state’s budget stabilization or “negative” factor. That’s the difference between what Colorado spends on schools and what it’s constitutionally required to allocate, based on inflation and numbers of students.

A group of education advocates hopes to place a $1.6 billion tax increase for schools on the November ballot. Colorado voters have twice before rejected tax increases for education, most recently in 2013.

“We need to support our teachers, and we need to support our schools, and we need you to ensure not only that we pass the bills that we are bringing this session, but that we unite this November to ensure our kids are put first in Colorado,” said state Rep. Brittany Pettersen, the Lakewood Democrat who chairs the House Education Committee.

The school finance act, which provides more detail on the education funding already set aside in the 2018-19 budget, calls for a little more than $7 billion in total program spending in 2018-19, a 6.95 percent increase from this year. The state portion is $4.5 billion, a 10 percent increase from this year; local districts would provide $2.5 billion, a 1.4 percent increase.

In addition to mandated budget increases, the bill adds $150 million more for education. That leaves the negative factor at $672 million, the smallest it has been since this budget maneuver was created during the Great Recession.

Average per-pupil spending for 2018-19 will be around $8,137, a $475 increase from this year.

During the hearing, state Rep. Barbara McLachlan, a Durango Democrat, asked Matt Cook of the Colorado Association of School Boards why teacher raises seem to come last when districts get more money, and state Rep. Alec Garnett, a Denver Democrat, asked if the legislature needs to have more oversight of how districts spend state money. Colorado does not have a statewide teacher salary schedule, and districts have a lot of discretion on how they set their budgets.

“The people on the ground are hurting,” Garnett said. “They can’t meet their basic needs. And I want to help them, but it’s really your members who hold the key to their solution.”

Colorado consistently ranks in the bottom tier for school spending and teacher pay, and a recent study ranked Colorado last for the competitiveness of its teacher salaries.

Cook said school boards are acutely aware of how low pay hurts their ability to hire and keep teachers. The availability of more money from the state will be a factor in union negotiations currently underway in districts around the state, he said.

But districts have to balance teacher pay with a wide range of needs, including services for students learning English and students with disabilities that are not funded by the state at their full cost, he said.

“We recognize that a qualified, highly motivated teacher in the classroom is a major part of a child’s education,” Cook said. “We’re doing the best we can. Nobody wants to not pay teachers.”

School district representatives told the committee that a promising state budget forecast is already turning into more services for students. An official from the Adams 12 Five Star district said the district had increased interventions for students with dyslexia in anticipation of more state money, and a superintendent from the rural Hanover district said $30 million in extra funding for rural schools – first allocated last year and now extended for a second year – allowed him to hire a second science teacher and a school counselor.

State Rep. Jim Wilson, the Republican co-sponsor of the school finance act and a former district superintendent, said he could just as easily ask lawmakers why the entire $1.3 billion budget surplus isn’t going to schools.

“I won’t ask you to answer that because you already know the answer,” he said. “That’s the same situation that a school district finds itself in.”

The school finance act also:

  • Sends an extra $30 million to rural schools,
  • Creates 1,000 new spots for children with certain risk factors in publicly funded preschool and kindergarten,
  • Allocates money for English language learners based on the actual number of students at various levels of need, rather than dividing it based on a formula,
  • Calls for any general fund surplus at the end of this budget year to go into education next year,
  • Requires that the negative factor for 2019-20 not be any larger than it is in 2018-19.

The school finance act still needs to pass the full House before it goes to the Republican-controlled Senate.