Hope for BEST

New schools could rise again through grant program if bill defies odds to become law

School under construction

Colorado’s school construction grant program has been a lifeline for districts with aging and inadequate buildings, particularly for small rural districts unable to build new schools themselves with local tax money.

But the impact of the seven-year-old Building Excellent Schools Today program has been blunted in recent years because of a cap on how much BEST can spend every year on repaying the lease-purchase agreements used to build new schools.

Program supporters have pushing to loosen that cap, and they took the first step this week when a Senate committee approved a bill to raise the limit.

That proposal, Senate Bill 16-072, has a long ways to go, but BEST supporters are encouraged. The cap issue hasn’t gone beyond informal discussions during previous sessions.

“I was pleasantly surprised that it came out of Senate Education unanimously,” said prime sponsor Sen. Andy Kerr, a Lakewood Democrat. “I’m cautiously optimistic.”

Created in 2008, BEST receives most of its funding from revenues generated by state-owned lands. That money comes from oil, gas and grazing leases and rents. The program uses that money, combined with matching funds from districts, to pay for school construction and renovation, ranging from brand-new buildings to replacement roofs, security systems and other small projects.

The program has provided more than $1.25 billion in state and local funds for projects since it started, covering more than 350 school facilities in more than 120 districts.

“For many Colorado school districts BEST is our only lifeline,” Mapleton Superintendent Charlotte Ciancio told the Senate Education Committee this week. Her district went through multiple applications and bond issue efforts before finally landing a grant in 2010.

A key BEST goal is to help resource-strapped districts to pay for building needs.

“We do not have the ability to raise what we need to either repair or replace,” Superintendent Kevin Schott told the committee. His Deer Trail district in eastern Arapahoe County is preparing a BEST application. “The new gym is 52 years old,” Schott noted.

Spending cap has cut down on large projects

The program’s main tool for funding larger projects is a lease-purchase device that involves investors providing upfront money for construction, then getting repaid over several years.

Annual debt repayments from state funds are limited to $40 million. The bill would phase in an increase in the overall cap to $60 million by 2019-20. The overall cap would be $120 million, including local funds also used to repay debt.

After approving more and more lease-purchase projects over several years BEST reached the state cap a couple of years ago. Since then it has issued mostly cash grants for smaller projects.

For example, in 2012-13, the BEST board approved projects worth $302 million, including nine lease-purchase deals totaling $217 million.

But for 2015-16, the board approved only cash grants worth about $90 million in state and local funds. That was enough to pay for relatively large projects in the De Beque, Edison and Roaring Fork districts, but several other big applications were rejected. The board makes grants once a year, subject to approval by the State Board of Education and the legislature’s Capital Development Committee.

“What the cap has effectively done is limit our ability to address large-scale projects,” said Scott Newell, director of the Division of Capital Construction.

Kathleen Gebhardt, a BEST board member, said districts also have quit applying for bigger projects. She notes that SB 16-072 would have a modest impact.

“It’s still a fairly small drop in a fairly big bucket” and will provide enough flexibility for “maybe one or two new schools a year,” Gebhardt said.

A 2010 study estimated statewide school facilities needs would rise to about $18 billion by 2018. The division will start updating that assessment this summer.

Amended bill provides no new BEST revenue

Kerr’s original draft of the bill also proposed an increase in BEST revenue. The program currently receives half the revenues generated by state lands or $40 million, whichever is greater. The bill proposed raising that $40 million to $60 million.

At Kerr’s request the committee on Thursday deleted that part of the bill.

Why? State income from oil and gas is dropping, so a $60 million BEST contribution might be unaffordable.

“We’ve had a great run over the last few years with the Colorado oil and gas boom, but we see a decline coming,” State Land Board director Bill Ryan told the committee.

Last year’s land board revenues of $185 million are expected to drop by more than $100 million this year.

With that portion of the bill removed, some committee members wondered if BEST will have enough income to support a higher cap.

“By taking out the increased revenue source, we’re saying BEST has permission to spend more, but we’re not giving it a new revenue source,” noted Sen. Owen Hill, a Colorado Springs Republican who chairs Senate Education.

Kerr responded that the BEST board should have enough money with its current land revenues, plus $40 million a year from wholesale taxes on recreational marijuana and lottery funds.

Gebhardt told Chalkbeat that the board expects to be conservative in the grants it recommends next May, perhaps spending only $40 million to $50 million in cash grants.

Those issues are expected to be discussed further at the bill’s next stop, the Senate Finance Committee.

One other BEST proposal is before the legislature this session. Senate Bill 16-035 would create a new investment advisory board assigned to increase returns from the state’s $875 million Public School Fund. Any increased revenues would go to BEST, according to the sponsor, Sen. Mike Johnston, D-Denver.

Kerr said he’s talked to Johnston about the bill and “there’s talk of kind of combining forces and having the two of them move through together.”

Investment strategy

Here are the initiatives Memphis’ education philanthropists will focus on in 2018

PHOTO: Matt Detrich/The Indianapolis Star
A charter leader from Indianapolis, Marcus Robinson is now CEO of the Memphis Education Fund, a philanthropic collaborative that invests in education improvement initiatives for Memphis schools.

A Memphis philanthropic group has shed its “Teacher Town” name but still plans to spend this year recruiting new teachers while also investing in growing the city’s single-site charter operators.

Unlike similar organizations in other cities across the country, the Memphis Education Fund plans to center its search locally — by helping local universities and groups prepare teachers for the challenges of urban education.

Originally called Teacher Town, the fund was created in 2014 by Memphis education leaders and local philanthropists with a goal of transforming Memphis into a destination city for talented teachers. That vision built on a major investment by the Bill & Melinda Gates Foundation to improve teaching in the city.

In 2016, the group adopted a broader goal of improving all schools; brought in a new leader, Marcus Robinson, from Indianapolis; and joined Education Cities, a national collective of local groups seeking to reshape schools in their cities

In part inspired by changes that have taken place in Indianapolis, where Robinson had worked as a charter leader, Education Cities coordinates local groups advocating for the “portfolio model,” a vision in which cities have more charter schools and let district schools operate more like charters.

Robinson told Education Cities a year ago that his next step for Memphis would be “to unite everyone around a common set of operating principles, expectations, and evaluations to create a level playing field for each operator to perform optimally.” This appears to be in line with the portfolio vision, which aims to give all schools flexibility to operate as they see fit, while holding them equally accountability for results.

But instead of bringing the Shelby County Schools district and local charter operators closer together, 2017 saw them waging open competition for students.

For 2018, Robinson is tackling priorities that are not likely to inflame divisions. The fund will continue to focus on principal training, along with helping single-site charter organizations, boosting reading skills among the city’s youngest students, and recruiting new Memphis teachers.

“We’re hell-bent to fill classrooms with teachers,” said Robinson, pointing to elementary schools as having some of the greatest need.

Memphis will need an estimated 3,600 new teachers by 2020, said Lesley Brown, who directs how the fund invests its money to attract, develop and retain talent for local schools.

Rather than recruiting teachers from outside of Memphis, Teacher Town’s original focus, Robinson said the fund is strengthening partnerships with local universities and teacher preparation programs, such as one launched at Rhodes College in 2016 with the help of a $7 million gift from the fund.

The Memphis Education Fund receives support from several local philanthropies, including The Pyramid Peak Foundation and the Hyde Foundation. (Chalkbeat also receives support from Hyde; read about our funding here.)

Robinson added that the fund also is ramping up its support for single-site charter operators, such as helping teachers implement new literacy curriculum at Memphis Delta Preparatory Charter School and STAR Academy Charter School.

“There’s less of an appetite for national charter organizations to move into Memphis,” he said. ”The next phase isn’t national CMOs (charter management organizations), but how do we encourage single-site schools to evolve.”

The group has doled out such grants to charters as part of a larger effort to boost student reading levels and develop teacher training for Core Knowledge Language Arts and KIPP Wheatley.

“Early literacy is a huge focus,” Robinson told Chalkbeat. “When we look at the test scores, early elementary scores are horrific. What’s the root? Access to quality literacy instruction.”

Paying for school

Sweeping study proposes major changes to the way schools are funded in Michigan

Michigan needs to change the way it funds education so that schools get more money for students who need extra attention — such as those who live in poverty and those who don’t yet have a strong command of the English language.

That’s the top recommendation from a prominent group of educators, policymakers, and business leaders who have been studying Michigan’s school funding system for much of the past two years.

While many states use a complex formula that gives schools more money if they serve children facing extra challenges, Michigan has long used a system that distributes the same amount of money for virtually all students, regardless of their needs.

The state provides some extra funding for students with disabilities — but not nearly enough, according to a state study last year that found schools across Michigan are getting $700 million less a year than they need to serve those students.

The study released Wednesday recommends a major restructuring so that schools would be fully funded for special education programs and would get extra funds to provide resources to students who need extra help. With that money, schools could offer lower class sizes, add counselors and social workers, and give teachers more support, the report says.

The study was conducted by Augenblick, Palaich and Associates on behalf of the Michigan School Finance Research Collaborative.

The collaborative — including top business and education leaders across the state — came together in 2016 after an earlier “school adequacy study” was largely ignored by political leaders.

The earlier study, which was funded by the state legislature, recommended that the state significantly increase the amount of money it sends to schools per student.

The collaborative hopes this new more robust study, which clocks in at more than 300 data-packed pages, will have a greater impact.

Since this study used multiple methods to determine the right funding level for schools, it will be more difficult to ignore, the group hopes.

The study — paid for with $843,000 from major foundations and 18 county school districts — included interviews with hundreds of educators, including district and charters school teachers. Those interviews helped researchers determine how much money schools need to more effectively do their jobs.

The study examined geographic cost differences in different parts of the state, labor cost differences, and other factors and determined that schools need approximately $9,590 each for students who don’t have special needs, including funds that would come from the state and federal governments.

The study recommends that schools get 35 percent more for students living in poverty, between 50 and 70 percent more for students who are learning English, 70 percent more for students with mild disabilities and 115 percent more for students with moderate disabilities.

Among other recommendations in the  report is that charter schools receive the same per-student funding as districts. Currently, the state’s funding system pays some districts more per student than others based largely on historic funding levels as opposed to current needs. Some districts — including most charter schools — are currently getting around $7,600 per child from the state while others get thousands of dollars more

It’s difficult to compare how much funding schools are getting now with the proposed $9,590 per student because schools get a mix state and federal dollars and the $9,590 doesn’t include things like transportation dollars.

The report suggests that the state use a new approach to student transportation in which transportation dollars are distributed differently, taking into account differences between urban and rural school districts.

The report did not put a price tag on the cost of implementing the recommendations and did not spell out how Michigan could come up with the extra money. But members of the collaborative said they hope lawmakers will consider the report as they make policy changes. 

“The issue here is not about whether you live in Farmington or whether you live in Ingham County, it’s about every child ought to have the opportunity to be successful and that ought to be our goal in Michigan,” said Randy Liepa, the Superintendent of Wayne County’s intermediate school district. “I don’t think there will be significant pushback on that.”

The findings were released Wednesday morning, with press conferences planned in Lansing, Grand Rapids, and in the Detroit area.

Read the full report here: