Distributing Dollars

Study: Billions meant for K-12 education diverted to colleges

What was intended as a one-time budget fix under former Gov. Jennifer Granholm has remained in place for nearly a decade, and has since 2009 diverted $4.5 billion in funding from the state’s K-12 schools to universities and community colleges, according to a report the Michigan League for Public Policy released today.

The study states that Granholm initially used money from the School Aid Fund, meant to fund K-12 education, as a one-time “loan” amid the economic downturn in 2009. Since then, however, Governor Rick Snyder’s administration, with support from the Michigan Legislature, has made a budget strategy of shifting School Aid Fund dollars to pay for tax cuts for businesses and wealthy individuals, the report said.

“Over the past eight years, the exception, unfortunately, became the rule, and using School Aid Fund dollars for higher education went from a last resort to the first order of business,” said Gilda Z. Jacobs, president and CEO of the Michigan League for Public Policy.

Throughout the Snyder years, conservatives have argued that more money directed at K-12 education wouldn’t necessarily improve outcomes. They pointed out that while school funding has been going up, the state’s test scores have been going down. But the report suggests that at least part of the increased funding has been siphoned off for colleges and universities.

Some $637 million in funding was diverted from K-12 education during the 2017-2018 school year, and those same schools will lose out on nearly $1 billion during the 2018-2019 school year.

Jacobs said while this tactic may be legal, “it is morally and fiscally irresponsible, and lawmakers should put an end to the practice immediately and permanently.”

During Snyder’s tenure, a growing portion of the budget for community colleges and universities has come from the School Aid Fund, the report said. And over the past five years, the total budget for community college operations have come entirely from the fund. The study also highlights that the state’s most recent budget more than doubles the School Aid Fund money going to higher education, thus accounting for a third of state funding for public colleges and universities.

But James Hohman, director of fiscal policy for the free-market think tank Mackinac Center for Public Policy, in response to the report, defended the practice, saying it is “expressly permitted by the state constitution.”

“Are they going to criticize rain for being wet next?” he said.

David Hecker, president of the American Federation of Teachers-Michigan, said the state needs to fund public education at all levels.

“Undercutting education and all the other tax cuts have really worked to decimate the funding that our students need,” he said. “We think the school aid should be for K-12, but they absolutely must then fund universities and community colleges the way they need to be funded out of the general fund.”

The Michigan League for Public Policy study, titled, “A Hard Habit to Break: The Raiding of K-12 Funds for Postsecondary Education,” said additional funding is needed for the state’s educational initiatives such as Early On Michigan, an early intervention program to identify and treat children from birth to 36 months with special needs. Early On receives $12.4 million in federal funding, and for the first time, state legislators approved $5 million from the School Aid Fund in the 2019 budget. But the Early On Foundation said the program needs an estimated $63 million to serve all students who need early intervention.

The Michigan League for Public Policy also advocated more School Aid Fund money go to the state’s At Risk School Aid Program, a school-based effort to improve reading skills among students who are falling behind. (A new state law will require third-graders to test as proficient in reading, or be held back.)  

Craig Thiel, research director for the Citizens Research Council of Michigan, said there is nothing unlawful about the way the money has been diverted. “All money that the state collects is green,” he said, “and can be spent within the letter of the law wherever it’s allowed to be spent.”

He said it’s hard to know if the money shifted to colleges and universities would have translated into K-12 academic gains.

“The question is would that have helped stymie or mitigate the slide of test scores in the state?” he said. “If the money had been put in classrooms, would the scores in Detroit, Flint, Livonia, and Birmingham be any better? We just don’t know.”

hot off the presses

A silver medal for Detroit pre-K. Now where are the kids?

PHOTO: Getty Images

Detroit has earned a silver rating, the second-highest possible, in a national ranking of urban preschool programs published Wednesday. But the report by the advocacy group CityHealth also says that too few eligible 4-year-olds are enrolled.

CityHealth, a foundation-funded organization that rates America’s largest urban centers based on their public policies, looked at how big cities stack up in offering preschool programs in a report published Wednesday.

Researchers at the National Institute for Early Education Research at Rutgers University conducted the study and compiled the report.

Following standards set by the largest state-funded pre-K organization, the Great Start Readiness Program, Detroit requires teachers in state preschool to have at least a bachelor’s degree, limits class sizes, and requires health screenings of children.

Those are some of the hallmarks of a high-quality program, according to CityHealth.

Only eight of the 40 cities whose policies were reviewed earned a silver rating, and only five earned the top gold rating. A handful of cities — Indianapolis and Phoenix, Arizona, among them — were far behind, with low enrollment and few or none of CityHealth’s model policies in place.

Still, the gap in Detroit’s pre-K system is a big one. The city has far fewer pre-K seats than it reportedly needs. That’s the case in many of America’s largest cities, according to CityHealth. In nearly half of the cities studied, pre-K programs reached less than one-third of the cities’ pre-schoolers.

The lack of preschool slots is one reason advocates from Michigan’s largest cities are pushing lawmakers to put early childhood on the agenda in Lansing. And it’s part of why Detroit Mayor Mike Duggan has gotten behind the idea of a expanded pre-K system for Detroit.

Read the full report here:

School Funding 101

Report: Michigan has biggest school funding decline in nation

How’s this for a grim school funding statistic: A new report out Wednesday says total revenue for Michigan schools declined 30 percent from 2002 to 2015 — the largest decline for any state over the past quarter century.

The statistic, adjusted for inflation, is among findings of a report by researchers at Michigan State University that reviews school funding and recommends how the state can improve.

“Michigan has tried to improve schools on the cheap, focusing on more accountability and school choice,” wrote David Arsen, lead author and professor of education policy. “To make those policies effective, they have to be matched with adequate funding. We have been kidding ourselves to think we can move forward while cutting funding for schools.”

Co-authors are Tanner Delpier and Jesse Nagel, MSU doctoral students.

Here are a few of the highlights in the report — which is aimed at spurring public discussion of how to improve school funding in the state. The data were adjusted for inflation:

  • Dead last: Where Michigan ranks in total education revenue growth since the mid-90s, when the state’s current school funding formula was developed.
  • 60 percent: How much funding for at-risk students has declined since 2001.
  • 22 percent: How much per-pupil revenue declined from 2002 to 2015.

 The report comes about a year after the bipartisan School Finance Research Collaborative released a comprehensive set of recommendations for fixing the school funding system in Michigan. The MSU report provides a review of that report and adopts many of its recommendations.

It also comes after a December lame-duck legislative session in Michigan that ended with lawmakers voting to shift some funding from the state School Aid Fund to other priorities, such as road repairs and environmental cleanups.

Officials from the Tri-County Alliance for Public Education, a group that represents educators in Macomb, Oakland and Wayne counties, said the MSU report should be a wake-up call for lawmakers. They said it confirms that Michigan’s K-12 funding is in crisis.

“Lawmakers need to stop hiding behind talking points that claim they are investing in our schools when the reality is our funding hasn’t even kept up with the rate of inflation, let alone the increased cost of the services we are being asked to provide our students,” said George Heitsch, president of the alliance and superintendent of Farmington Public Schools. “When you see the numbers from this report showing the drastic funding cuts that have been forced on our schools in recent years, it should be no wonder why our state ranks at the bottom in reading and math proficiency. This simply has to change because our students deserve better.”

Read the full report for more information and recommendations: