K-12 EducationK-12 Education

What reporters need to knowWhat reporters need to know

Governmental structureGovernmental structure

• K-12 education is both• A creature of state government• And a unit of local government• Special case: Charter schools• Creature of chartering agency

• K-12 education is both• A creature of state government• And a unit of local government• Special case: Charter schools• Creature of chartering agency

Unit of local gov’tUnit of local gov’t

• School districts• Geographically defined• Governed by elected Board of

Education• Administered by superintendent

• School districts• Geographically defined• Governed by elected Board of

Education• Administered by superintendent

Boards of educationBoards of education

• Elected by the people• At large• On non-partisan ballot

• Exercise legislative power• Establish policies• Hire/fire superintendents

• Elected by the people• At large• On non-partisan ballot

• Exercise legislative power• Establish policies• Hire/fire superintendents

SuperintendentsSuperintendents

• Professional educators• Experienced• Advanced degrees• Highly paid

• Oversee all school operations• Recommend and supervise staff

• Professional educators• Experienced• Advanced degrees• Highly paid

• Oversee all school operations• Recommend and supervise staff

Creature of state gov’tCreature of state gov’t

• State government controls• Curriculum• Teacher standards• Funding

• State government controls• Curriculum• Teacher standards• Funding

CurriculumCurriculum

• Core curriculum• Math, science, language arts, social

studies• Grade-level expectations

• Graduation requirements• Recently expanded beyond

Govt/econ

• Core curriculum• Math, science, language arts, social

studies• Grade-level expectations

• Graduation requirements• Recently expanded beyond

Govt/econ

Teacher standardsTeacher standards

• Requires all teachers to be certified• To teach in Michigan• At their grade level or subject area

• Sets certification standards• Enforced through university

programs

• Requires all teachers to be certified• To teach in Michigan• At their grade level or subject area

• Sets certification standards• Enforced through university

programs

K-12 FundingK-12 Funding

• Governed by Proposal A, a constitutional amendment approved by the people in 1994.

• Governed by Proposal A, a constitutional amendment approved by the people in 1994.

Before Proposal ABefore Proposal A• Schools funded by combination of• Local property taxes• State funding if property tax revenue fell

below a certain level

• Level of funding mostly depended on• Local tax base• Local decisions on tax rate

• Millages subject to voter approval

• Schools funded by combination of• Local property taxes• State funding if property tax revenue fell

below a certain level

• Level of funding mostly depended on• Local tax base• Local decisions on tax rate

• Millages subject to voter approval

Before Proposal ABefore Proposal A• Two main flaws in funding mechanism• High property taxes• A third higher than U.S. average• Eventually led to ‘tax revolt’

• Disparity in per-pupil spending• Richest districts spent almost four

times as much as poorest.

• Two main flaws in funding mechanism• High property taxes• A third higher than U.S. average• Eventually led to ‘tax revolt’

• Disparity in per-pupil spending• Richest districts spent almost four

times as much as poorest.

Funding disparity example

Funding disparity example

• Per-pupil spending in 1993-94• Lowest: Sigel Township, Huron

County• $2,762/pupil

• Highest: Bloomfield Hills• $10,294/pupil

• Gap: $7,531 or 3.7:1

• Per-pupil spending in 1993-94• Lowest: Sigel Township, Huron

County• $2,762/pupil

• Highest: Bloomfield Hills• $10,294/pupil

• Gap: $7,531 or 3.7:1

What caused disparityWhat caused disparity

• Funding depends on local tax base

• Which depends on land value• Industrial, commercial land worth

more per acre than• Residential, agricultural, gov’t-

owned

• Funding depends on local tax base

• Which depends on land value• Industrial, commercial land worth

more per acre than• Residential, agricultural, gov’t-

owned

Impact of disparityImpact of disparity

• Constitution guarantees free public education to every Michigan child• At a 4/1 funding disparity, was

that guarantee being met?• Many Michigan residents said no.

• Constitution guarantees free public education to every Michigan child• At a 4/1 funding disparity, was

that guarantee being met?• Many Michigan residents said no.

The crisisThe crisis• By early ‘90s• Collision of funding disparity and tax

revolt• Many districts struggling to make ends meet• Poster child: Kalkaska

• Couldn’t pass operating millages• Ran out of money• Shut down three months early

• By early ‘90s• Collision of funding disparity and tax

revolt• Many districts struggling to make ends meet• Poster child: Kalkaska

• Couldn’t pass operating millages• Ran out of money• Shut down three months early

The crisisThe crisis• Kalkaska galvanized Legislature• Property tax abolished as primary K-

12 funding source• Voters given a choice• Return to income tax as primary funding

sourceOr• Pass Proposal A

• Kalkaska galvanized Legislature• Property tax abolished as primary K-

12 funding source• Voters given a choice• Return to income tax as primary funding

sourceOr• Pass Proposal A

Proposal A of 1994Proposal A of 1994• Established state as primary funding source

• Raised sales tax from 4 to 6 percent• Levied 6-mill state education tax

• Big tax decrease for homeowners• Guaranteed a minimum per-pupil funding level

• Big increase for poorest districts• Didn’t immediately reduce funding for well-off

districts

• Capped growth in taxable property value• Established schools of choice and charter

schools

• Established state as primary funding source • Raised sales tax from 4 to 6 percent• Levied 6-mill state education tax

• Big tax decrease for homeowners• Guaranteed a minimum per-pupil funding level

• Big increase for poorest districts• Didn’t immediately reduce funding for well-off

districts

• Capped growth in taxable property value• Established schools of choice and charter

schools

Proposal AProposal A

• Adopted in March 1994• Margin of 61 to 39 percent

• Adopted in March 1994• Margin of 61 to 39 percent

ImplementationImplementation• School Aid Fund is established• Revenue stream set up• From 6-mill State Education Tax• From sales tax, other sources

• State becomes funding source• Foundation allowance per pupil• Set annually by Legislature• Distributed to districts by formula

• School Aid Fund is established• Revenue stream set up• From 6-mill State Education Tax• From sales tax, other sources

• State becomes funding source• Foundation allowance per pupil• Set annually by Legislature• Distributed to districts by formula

Impact on schoolsImpact on schools• Richer districts

• Funding levels protected, but grow more slowly

• Poorer districts• Get substantial increase, plus catch-up funding

• Sigel Township, 1993: $2,762• Sigel Township, 1994: $4,200

• Richer districts• Funding levels protected, but grow more slowly

• Poorer districts• Get substantial increase, plus catch-up funding

• Sigel Township, 1993: $2,762• Sigel Township, 1994: $4,200

Growth in per pupil funding

Growth in per pupil funding

• Minimum foundation allowance• 1994-95 -- $4,200• 1999-00 -- $5,700• 2004-05 -- $6,700• 2008-09 -- $7,316

• (CPI = $6,013)

• Bloomfield Hills• 1993-94 -- $10,294• 2008-09 -- $12,433

• (CPI = $15,116)

• Minimum foundation allowance• 1994-95 -- $4,200• 1999-00 -- $5,700• 2004-05 -- $6,700• 2008-09 -- $7,316

• (CPI = $6,013)

• Bloomfield Hills• 1993-94 -- $10,294• 2008-09 -- $12,433

• (CPI = $15,116)

Selected districts in 08-09

Selected districts in 08-09

• Shepherd, Beal City, Chippewa Hills, $7,316

• Mount Pleasant, $7,376• Alma, $7,584• Buena Vista, $8,246• Midland, $8,904

• Shepherd, Beal City, Chippewa Hills, $7,316

• Mount Pleasant, $7,376• Alma, $7,584• Buena Vista, $8,246• Midland, $8,904

Reduction in disparity (2009)

Reduction in disparity (2009)

• Lowest-funded districts• Numerous, at $7,316

• Highest-funded district• Bloomfield Hills, $12,433

• Ratio• 1.7/1

• Lowest-funded districts• Numerous, at $7,316

• Highest-funded district• Bloomfield Hills, $12,433

• Ratio• 1.7/1

ProsPros

• Proposal A works well when• Enrollments are rising at moderate

rate• State economy is okay• Costs are contained

• Proposal A works well when• Enrollments are rising at moderate

rate• State economy is okay• Costs are contained

ConsCons

• It works less well when . . . • Enrollments fall• Costs are less elastic than enrollment

• Costs rise more rapidly than revenue

• State economy is poor

• It works less well when . . . • Enrollments fall• Costs are less elastic than enrollment

• Costs rise more rapidly than revenue

• State economy is poor

Trouble Ahead?Trouble Ahead?• Enrollment

• Michigan birthrate below national average• More people leaving than moving in

• State’s economy• Highest unemployment rate in nation• Annual budget crises

• Costs rising• Health costs going up at twice rate of

inflation

• Enrollment• Michigan birthrate below national average• More people leaving than moving in

• State’s economy• Highest unemployment rate in nation• Annual budget crises

• Costs rising• Health costs going up at twice rate of

inflation

Bottom LineBottom Line• Proposal A has accomplished some

of its most important goals -- • Coming through on the state’s

guarantee of a free public education• Reducing -- but not eliminating -- the

disparity in funding between rich and poor districts.

• Proposal A has accomplished some of its most important goals -- • Coming through on the state’s

guarantee of a free public education• Reducing -- but not eliminating -- the

disparity in funding between rich and poor districts.

But . . . But . . . • It is not working well in a time of

declining enrollments and a struggling state economy

• It is losing support among key constituencies

• Sentiment is building for change in the way Michigan funds K-12 education.

• It is not working well in a time of declining enrollments and a struggling state economy

• It is losing support among key constituencies

• Sentiment is building for change in the way Michigan funds K-12 education.

Questions?Questions?

• Today’s PowerPoint design is “Desk Lamp”

• Today’s PowerPoint design is “Desk Lamp”