funding fun

After heated debate, New York charter schools receive boost; school aid increases by $1.1 billion

PHOTO: Creative Commons, courtesy JasonParis
Albany statehouse.

More than a week after the state’s budget deadline, lawmakers resolved their differences on education with a per-pupil increase in charter school funding and a $1.1 billion increase in school aid.

The funding tug-of-war between charters and traditional public schools boiled over into a contentious fight this year, which contributed to the most delayed budget on Governor Andrew Cuomo’s watch.

Charter schools were due a big funding boost if lawmakers did not act, a concern for the Democrat-controlled Assembly and teachers unions. Meanwhile, Cuomo warned that the state might not be able to handle a large increase in education spending with possible federal cuts on the horizon.

In the end, despite the long haul, the set of compromises seems to have left each party at least fairly satisfied. Charter schools will get extra funding and will have future aid linked to spending on traditional public schools. State aid for education, more broadly, will increase by more than $1 billion. The state’s teachers union called the budget “all in all, progress for our students.”

Here’s more on each of the big education items announced in this year’s budget:

Charter schools get funding boost, increases will be linked to those for public schools

The deal will increase funding for charter schools by $500 per pupil, and starting in the 2018-19 school year, “tuition” funding paid by the state will increase at the same rate as public school spending.

That compromise was struck, in part, in response to a charter school tuition formula that has been frozen since 2010-11 (though some years charter schools have received supplemental aid). The formula was set to unfreeze this year and would have resulted in a $1,500 increase in per-pupil spending, which Cuomo called a “windfall” for charter schools. (Charter school advocates say it is important to achieve equitable funding between traditional public schools and charters.)

One major problem with that plan, according to Mayor Bill de Blasio, was that the extra funding was set to come out of the city’s budget. (New York City’s Office of Management and Budget estimated it would cost the city about $200 million.)

The final result strikes a middle ground. The state will cover the extra $500 per pupil in the upcoming school year, but starting the next year, when charter school tuition increases mirror district school increases — and that money will come out of the city’s coffers.

There is another benefit for charter schools in the state’s budget: more funds for schools moving into private space. Under a 2014 law, new and expanding charter schools that don’t get public space are entitled to either 20 percent of their per-pupil tuition rate or their total rent. Now, that number has jumped to 30 percent.

Finally, Cuomo proposed lifting the cap on the number of charter schools allowed to open in New York City in January and instead having one big cap for the entire state. That proposal was rejected, leaving only 30 additional charter school slots for the city — and perhaps a battle for another year.

Most charter advocates are pleased with the outcome. New York City Charter School Center CEO James Merriman called it a “major victory.”

“This budget agreement was hard fought and we deeply appreciate the tenacious commitment of Governor Cuomo, Majority Leader Flanagan and Coalition Leader Klein to treat public charter school students fairly,” said Merriman said in a statement.

Success Academy CEO Eva Moskowitz disagreed with that assessment, saying the agreement “shortchanged” students in charter schools.

Total school aid spending a bit below proposals

School aid is set to increase by $1.1 billion, bringing total education spending to $25.8 billion.

That is slightly below expectations. It is close to what the governor originally proposed — a $1 billion increase — but it is less than what the Assembly or Senate proposed, $1.8 billion and $1.2 billion, respectively. It is also far below what state’s education policymaking body proposed at $2.1 billion.

Late in March, Cuomo suggested the threat of federal cuts could limit education spending, since he was not sure the budget could handle “dramatic increases” with federal uncertainty.

Foundation aid is here to stay

A major portion of education spending is allocated through a “foundation aid” formula, which is designed to help to needy students. The formula was created in response to the Campaign for Fiscal Equity lawsuit, which found some New York children did not have access to a sound basic education.

This year’s increase in foundation aid is $700 million, though advocates argue the total increase should be much higher, given the amount they say is owed under the lawsuit: $4.3 billion in all. The state’s Board of Regents outlined an “aggressive” plan to have the state provide that full amount over three years.

But advocates are relieved the “foundation aid” formula itself will remain intact. Cuomo’s original proposal included a controversial change to the formula that several advocates called a “repeal.” That’s off the table this year and an additional increase is expected next year, according to the New York State Council of School Superintendents Deputy Director Robert Lowry. But it remains to be seen whether the total amount of funding will be fully phased in over the years to come, especially since Cuomo’s office disagrees that the money is owed to schools.

“In a major victory, Governor Cuomo’s plan to repeal the foundation aid formula was defeated,” said Billy Easton, executive director of the Alliance for Quality Education, an advocacy group that fights for increased school funding. “The foundation aid increase is modest, but it is a significant improvement on the truly meager foundation aid proposal offered by the governor.”

Take back

Higher property values mean Colorado is getting back millions from schools

PHOTO: J. Zubrzycki
Colorado State Capitol

With student enrollment lower than anticipated and property tax revenues up in many districts, the state could get back as much as $77 million originally allocated for schools this year.

That’s a small portion of Colorado’s $7 billion K-12 education budget, and that money could be used to help fund Gov. Jared Polis’ universal full-day kindergarten plan. But some lawmakers want school districts, not the state, to control at least a portion of that money.

Citing the recent Denver teacher strike and concerns over school funding, the Colorado House voted Friday to let schools keep $12.9 million of that money. As early as Wednesday, the state Senate must either approve the amended Senate Bill 128 or send it back to a conference committee made up of the budget committee members.

It’s the first salvo in what could become a contentious debate over how the state funds schools.

Under Colorado law, the legislature determines how much money school districts should get for each student, with the state and school districts picking up a portion of the costs. If local districts raise more money, the state pays a correspondingly smaller amount. This year, school districts raised a collective $56.1 million more than predicted from local sources, mostly property tax revenue.

At the same time, schools are educating fewer students than predicted. Per pupil funding is based on estimates made months in advance. Enrollment for the current school year is 1,056 fewer than forecast, with at-risk student enrollment 9,893 fewer than the estimate.

The $77 million — or $64.1 million if the House amendment stands — could help fund full-day kindergarten, which is estimated to cost $227 million next year.

Or it could go into next year’s school finance act, which lays out how much money schools will get for 2019-20. Or it could go into the general fund, where it could be used for other needs.

But asking school districts to return money midway through the year can be difficult “because districts hire teachers for the start of the school year and then it’s really hard halfway through to say, ‘Oh, we can’t pay for you anymore,’” said Matt Cook, director of advocacy and public policy for the Colorado Association of School Boards.

Last year, the state took back $104 million. With an increase in local revenues of $97 million, the total cut was only about $7 million, compared to a $21 million impact this year if the state keeps the full amount. Some of last year’s money was later put toward school safety measures.

The House amendment keeps average per-pupil funding at $8,137, instead of reducing it by about $15 on average as the Joint Budget Committee proposed.

The impact of these proposed changes varies among school districts, said Tracie Rainey, executive director of the Colorado School Finance Project. Some districts have seen larger changes in enrollment than others, and some districts raise a large portion of their revenue from local sources, while others are more dependent on state funding.

“[Y]ou’re all of a sudden again going to have a whole different group of kind of winners and losers in this process,” she said.

There’s also a political consideration for Democrats and Republicans alike.

“Everybody who ran for election this last year ran on funding education better, and that they were looking to try to solve the problem,” Rainey said.

In fact, attack ads in the 2018 election often cited votes on school finance amendments or promises to increase school funding.

The House amendment passed on a voice voice with apparent broad support. It replaced an earlier amendment that would have left all $77 million with the school districts.

“I think our next step for us would be what’s the financial, fiscal implication of the amendment and then wait to see what we hear from our staff,” said state Sen. Rachel Zenzinger, an Arvada Democrat and budget committee member.

How this relatively tiny slice of the pie is carved up could be instructive, going forward, education observers say.

“That’s always the big question every year, right?” Cook said. “How do we pay for everything? This year you’ve got the pressure for full-day kindergarten, so I think it’s going to be a very tough budget negotiation.”

new money

House budget draft sends more money to schools, but not specifically to teacher raises

PHOTO: Laura Faith Kebede/Chalkbeat

Despite months of heated debate, Indiana House Republicans are not setting aside extra dollars for meaningful teacher raises in their version of the state’s $14.5 billion education budget plan released Monday night.

Even though lawmakers are proposing preserving a controversial merit-based bonus pool and adding small amounts for teacher training programs, their budget draft would largely leave it up to school districts to dole out raises through increased overall funding.

The budget draft proposes increasing what Indiana spends on schools overall by $461 million — or 4.3 percent — through 2021, a little more than increases in years past. The basic per-student funding that all districts get would jump from $5,352 per student this year to $5,442 per student in 2020 and $5,549 per student in 2021. House lawmakers are also adding in a one-time payment of $150 million from state reserves that would pay down a pension liability for schools. But while lawmakers and Gov. Eric Holcomb have said that pension payment would free up about $70 million in schools’ budgets each year, the state likely wouldn’t require the cost-savings be passed along to teachers.

Although increasing teacher pay is a top goal for House Republicans, lawmakers have crafted bills that hinge on districts spending less money in areas such as administration or transportation rather than adding more money to school budgets and earmarking it for teacher salaries.

Their criticism of school spending has raised the ire of superintendents and educators who say they have little left to cut after years of increasing costs and state revenue that has barely kept pace with inflation.

But budget draft, which is expected to be presented to and voted on by the House Ways and Means Committee on Tuesday, doesn’t completely omit efforts to incentivize teachers to stick around. Unlike Holcomb’s budget proposal, House lawmakers are keeping in the current appropriation of $30 million per year for teacher bonuses.

The House budget draft would also set aside $1 million over two years for a teacher residency pilot program and $5 million over two years for schools that put in place career ladder programs that allow teachers to gain skills and opportunities without leaving the classroom.

Teacher advocacy groups, such as the Indiana State Teachers Association and Teach Plus, have been supportive of residency and career ladder programs, but the organizations have also called for more action this year to get dollars to teachers. Additionally, the ideas aren’t new — similar programs have been proposed in years past.

Calls for the hundreds of millions of dollars it would take to raise teacher salaries to be more in line with surrounding states will likely go unheeded for now as the state instead prioritizes other high-profile and expensive agencies, such as the Department of Child Services and Medicaid.

But while plans for major teacher pay raises appear to be on hold, House lawmakers are looking to boost funding in other areas of education to support some of the state’s most vulnerable students.

The budget draft would increase what the state must spend on preschool programs for students with disabilities from the current $2,750 per-student to $2,875 in 2020 and $3,000 in 2021 — the first such increase in more than 25 years.

House lawmakers are also proposing the state spend more money on students learning English as a new language, at $325 per student up from $300 per student now. While all schools with English learners would receive more money per student under this plan, the new budget draft removes a provision that had previously allocated extra dollars to schools with higher concentrations of English learners.

A 2017 calculation error and an uptick in interested schools meant state lawmakers did not budget enough money for schools with larger shares of English-learners in the last budget cycle, so they ended up getting far less than what the state had promised. But even the small increases were valuable, educators told Chalkbeat.

House lawmakers also suggested slashing funding for virtual programs run by traditional public school districts. Going forward, funding for both virtual charter schools and virtual schools within school districts would come in at 90 percent of what traditional schools receive from the state — now, only virtual charter schools are at the 90 percent level. It’s a marked change for House lawmakers, who in years past have asked that virtual charter school funding be increased to 100 percent.

The virtual funding proposal comes as lawmakers are considering bills that would add regulations for the troubled schools, where few students pass state exams or graduate.

The budget draft also includes:

  • $5 million per year added to school safety grants, totaling $19 million in 2020 and $24 million in 2021
  • Doubling grants for high-performing charter schools from $500 per student to $1,000 per student, at a cost of about $32 million over two years. The money is a way for charter schools to make up for not receiving local property tax dollars like district schools, lawmakers say.
  • $4 million per year more to expand the state’s private school voucher program to increase funding for certain families above the poverty line. Under the plan, a family of four making between $46,000 and $58,000 annually could receive a voucher for 70 percent of what public schools would have received in state funding for the student. Currently, those families receive a 50 percent voucher.
  • About $33 million over two years (up from about $25 million) for the state’s Tax Credit Scholarship program.