Funding help needed for schools

Tribune Opinion
March 29, 2007

Tinkering with school funding without first taking some feel-out political laps is about as fruitful as getting under the hood of a NASCAR racer without the pit crew's permission.

That appears to be the lesson of Gov. Bill Ritter's recent foray into school funding, the state's largest annual expense.

With fanfare at a mid-March press conference, Ritter announced his support for a measure that would provide $84 million annually to K-12 education. Most of the money from the proposal -- $65 million -- would be generated by stabilizing local mill-levy rates used to determine property taxes. That amount would be spent on full-day kindergarten and would help prevent the State Education Fund from slipping toward insolvency, Ritter said.

The measure, of course, is controversial. Many lawmakers view the stabilization of mill levies as essentially a tax increase. As property values rise, regardless of a frozen mill rate, taxes will correspondingly go higher, they argue.

So when the proposal came before the Senate last week, lawmakers booted it out of the School Finance Act. Senate Bill 199, without the property tax measure, passed the Senate on a 34-0 vote last week.

It's unfortunate the proposal appears headed from stall to fall -- before it moves to the House, lawmakers are awaiting an opinion from legislative counsel about the legality of the measure -- because it's clear the school funding system is in need of a fix.

That memo is in and it joins another legal memo from 2004 in proving that the proposal is legal and constitutional.

The Taxpayer's Bill of Rights, which sets spending caps, and the Gallagher Amendment, which limits the amount of burden that can be put on residential property owners, combine to lower the amount of property tax that goes to school financing, leaving the state to cover the gap. Where the local share of school district funding was about 60 percent in the early 1980s, it's now only about 30 percent. That shift has played a role in crimping the State Education Fund, which is projected to run into a $100 million deficit by 2011.

True -- and it's not just the State Education Fund that's paying the bill: money to subsidize the shift is also coming from the state's General Fund. That's important because our limited General Fund pays for most of the services the state offers, everything from higher education to the court system. As we spend more money from the General Fund to cover the shift from local property taxes, we have to take that money from everything else in the budget.

"Without a comprehensive plan such as this amendment, the state's general fund -- which also pays for higher education, health care and human services -- would be forced to subsidize the State Ed Fund, and that would have harmed those other services," Ritter said.

Were it not for Amendment 23, which mandates a 1 percent annual increase in funding on top of inflationary adjustments, school districts could well see their budgets battered by Gallagher-TABOR and a legislature looking for ways to fund other services.

That's one of the things that makes all of this so frustrating. The voters were very clear that they didn't like Colorado's slow slide toward the bottom in the ranking of state spending on schools. They passed Amendment 23 to reverse the slide.

It put in the state constitution a requirement that each year we increase school spending by at least the rate of inflation plus the number of new students. That was to keep us from falling farther.

To push us back up toward the national average in school funding, the voters said that, for 10 years, we had to add an additional 1% to that annual inflation plus new students formula.

Since TABOR limits local taxes for schools to an increase of inflation plus new students, that 1% would have to come from increasing local tax revenue or from more state subsidization.

In 174 (out of 178) school districts, the voters decided to let their schools keep more tax revenue. That would help stop the shift to the state, but a quirk in state law has been blocking it.

But Amendment 23 sunsets in a few years, making local school district officials anxious for a funding formula revamp -- and soon.

That's true, but it's unlikely to happen until we clean up the problems from the original Amendment 23.

"A full review of the finance formula ... needs to be considered," said Karen Trusler, superintendent of the Windsor Re-4 School District.

Trusler is right, but as long as the quirk in state law is shifting costs from local districts to the state, a full review will dissolve into a squabble over what little money is available.

Trusler's school district is among a small group of districts statewide that would benefit from the Ritter-supported
measure, which is co-sponsored by Sen. Sue Windels, D-Arvada, and Rep. Jack Pommer, D-Boulder.

Part of the measure provides 11 school districts now at the state funding floor with $6.3 million, which would come from the State Education Fund. Windsor is among the floor-funded districts, joining Johnstown/Milliken Re-5J, Poudre School District and Thompson R2-J in Loveland as four regional members of the list.

The floor funding problem comes from another quirk in state law. Our school finance law is supposed to equalize funding across the state. We use a complicated formula that includes various factors to account for differences in the cost of education across the state. That formula has tended to increase overall funding for most districts over the years. But it leaves out a few districts -- the so-called "floor districts."

"The funding gap is getting wider, and these funds would help keep the gap from increasing," Trusler said. Windsor stands to get an additional $140 per pupil under the measure, while Johnstown/Milliken would get about $20 per pupil.

Colorado ranked 24th nationally in per-pupil operating expenditures, according to National Center of Education Statistics. In 2004, the last year figures are available, Colorado spent $7,478 per pupil, compared to the national average of $8,310.

As pressures rise for schools to meet the high standards of state assessments and the federal No Child Left Behind Act, adequate resources must be made available.

This is a hidden issue that goes beyond the quirks in state law that are holding back education funding. New standards have added costs to schools, but our funding barely keeps up with the general rise in prices.

So we believe the measure promoted by Ritter makes sense. It helps stabilize cash flow to schools before they become swamped further by unfunded mandates. It would bring some relief to four northern Colorado school districts on the bottom of the current funding curve.

But it appears it's going to take time for Ritter and other supporters to allay the mounting political concerns. Some laps around the educational track -- getting the message out to residents and lawmakers as to why this is important -- is necessary before this forward-thinking proposal will gain traction.

Excellent point. We're working hard to help people understand what's going on and convince them that we have to fix it. A clear explanation and solid support from the Greeley Tribune certainly helps.