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Peeling The Onion: Major School Cuts Don't Jibe With "Record" School Funding Claims


Dear Friends and Neighbors:


Last week I mentioned that I and many of my colleagues had filed legislation to stop a third year of damaging school staff cuts, and to make up for prior cuts so our students can have the courses and teachers they need to succeed and become vital parts of a strong economy.

At the same time the Governor and some of his allies claimed we were increasing funding to “record” levels. And some of the media got confused, understandably. How can schools be cutting staff when they are getting supposed “record” amounts of money? Well, in a fair sense, the latter claim is not accurate – classroom funding has lagged behind inflation.

I, and my staff in our cozy small office in the Capitol, have worked on peeling back this onion. We’re doing this so we can have a fair education discussion this session, rather than a duel of sound bites.

You might guess that “record” classroom funding wouldn’t lead to closed summer school, an announcement that Anchorage is laying off 215 guidance counselors, special education, and other needed staff next year, or an announcement from Juneau that they will have to increase class sizes. Again. The story is the same across much of Alaska.

Turning Sound Bites into a Full Story

The state hasn’t increased its per student allocation of education funds under our K-12 education formula since fiscal year 2011. That formula has lagged behind inflation by about 9% from then through the Governor’s proposed budget for the coming year.

Schools like to know they are not losing money year after year, so they don’t have to keep laying off staff and cutting education curriculum, classes and other educational services. Until recent years we let schools know we were keeping that amount roughly even with the cost of living for their next school year, so they could plan. Not letting them plan is harmful, both to students, and as a matter of efficient planning.

In fairness, since 2011 the legislature has added minor one-time funds to that unchanged per student allocation formula. Sometimes for fuel costs, sometimes for other matters, and the next year that money would disappear or change.

In any case, here’s where we are. The amount the state has put into classroom funding (teachers, staff, materials, courses and the things that teach students), on a per student basis, has fallen in comparison to inflation since fiscal year 2011 through the Governor’s proposed budget for the coming fiscal year 2014. By roughly $110 per student, according to an independent Legislative Finance division report, and by more according to the independent Legislative Research division. But both conclude, based on confusing education funding numbers, that it has fallen in a damaging way.

I’m relying here on the more conservative Legislative Finance analysis, which we most recently received. The linked chart shows a purple bar on the right, comparing the funding proposed by the Governor for this coming year to prior years’ funding dating back to 2011. This comparison assumes upcoming year inflation at 1.8% which is what the Federal Reserve Board forecasted in December 2012. I’ll explain more below. It shows classroom funding has lagged.

The big increases in school funding – that form the basis for the claims that Alaska has engaged in “record” school funding – are for things that don’t ever reach the classroom, and aren’t used to hire teachers, staff, or address curriculum.

These non-classroom funding amounts are not included in the linked chart, though the amounts spent on those items are listed in the columns below the chart so you can see them.

Funding Pension Trust Shortfalls: The state and municipalities, including schools, have an underfunded retirement trust system that has threatened payment to retirees of the pensions they have earned. We can’t break retirement promises to people who’ve honestly relied on them. So the state and municipalities have put a big chunk of money into those systems to catch up for past underfunding. But that money cannot be spent on education. It cannot be spent on teaching, or courses. I voted roughly five years ago, before Governor Parnell took office, for a bi-partisan bill to help make up for this long-created shortfall owed to school and other pension systems. I’m glad we’re honoring our promises and fixing this shortfall. That expense has far outpaced inflation since our debt was so great. So while classroom funding has lagged behind the cost of inflation and schools have been on a three-year course of cuts that harm academic achievement and job opportunities, this pension debt category of money has been counted by those who claim “record” education expenditures.

Funding Busing Costs: The state has, on and off, tussled with whether to reimburse schools for the cost of transporting children to school. I believe we should. If we don’t, then schools have to cut the classroom funding that teaches our kids and spend it on fuel, buses and the like instead. We currently have a good, bi-partisan law that reimburses schools, in effect, for their transportation costs (it’s our best estimate as to what schools need to pay for school transportation).

As the price of fuel increases, sometimes rapidly, our costs go up to fund school transportation. In the past two years school busing costs have risen significantly. That forms the other part of the claim that “school funding” has increased. But, again, these funds don’t make their way into the classroom. They aren’t used for teachers, keeping summer school open, curriculum, or the other things that teach students.

Classroom Funding Has Fallen: If you count state funds for classroom funding, they have fallen behind inflation. That’s true even if we count an influx of vocational educational funding which isn’t available for traditional classroom work – but has been used to enhance our vocational teaching efforts. So, let’s count that as classroom funding.

The Losses Are Actually Bigger: let’s ignore for a moment that keeping up with inflation isn’t actually keeping up with school costs. Why? Because schools have to pay for health insurance premiums which have risen more than double the rate of inflation, and eat away at classroom funding dollars. To make up for past classroom funding losses, rising health premiums should be counted.

Where does that leave us? Conservatively speaking, at about $110 less per student than schools received, in real dollars, since fiscal year 2011. That doesn’t include losses due to health insurance increases, and the Legislative Research department has earmarked the loss at more than $200. We are still working on the discrepancy between the two reports, and they are not likely anyone’s fault. The education budget is complex.

Both agency reports explain why Anchorage has reduced teachers and other staff the past two years, and has announced 215 staff cuts for next year under the Governor’s budget. And it explains staff cuts statewide.

The legislation we have proposed adds about $280 per student, to reflect the reality that inflation and insurance costs have significantly eaten away classroom dollars. And, while I support vocational education enhancements, those have done nothing to help fund non-vocational classes, where the losses have been. With testimony from school districts we’ll be able to refine this number needed by schools more accurately. We hope legislators listen to our school districts.

So – mystery solved. Classroom funding has fallen behind inflation. In a state where less than 70% of students graduate from high school, we need to enhance student achievement. This won’t happen if we lose teachers, special education staff, counselors who guide our youth towards college and job training opportunities, and those responsible for giving our children a chance in life.

The Governor is not fully inaccurate; but he misses the point when it comes to improving our schools. He can’t take credit for “record” increases to classroom funding either. The latter, with inflation factored in, has fallen.

Parents, educators and school administrators across the state are not crying wolf. They are shouting the truth. In our bill we have added more than that in an effort to reduce class sizes. However, speaking for myself, I am negotiable as long as we can find a resolution that moves schools forward, and makes up for some of the past damage that’s been caused to our efforts to train our next generation, and build our economy.


[signed] Les Gara

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