Public schools across the state are cutting programs and staff to balance budgets. The recent economic downturn, expensive mandates, and–some recent and others not so recent–changes to the tax structure have stretched education dollars. Record-breaking enrollments and more students with educational challenges also strain budgets, and yet education-funding efforts decline.
So, to start with, here’s a little refresher on where school funding comes from:
- State income tax, earmarked for K-12 and higher education (formerly was earmarked for only K-12; more on this later)
- State-mandated basic levy property tax (part of the minimum school program)
- Other locally levied property taxes (voted leeway, board leeway, reading levies, etc.)
- Federal funds
Funding effort decline presentation
Utah had been one of the highest in the nation for funding effort until this decade. The fall in education funding began with policy decisions during the 1990s. (click to enlarge graph presentation.) Utah Foundation’s research report “PARADOX LOST,” notes that Utah ranks dead last in education funding. However, it also observes another measure—tax revenue per $1,000 of personal income. This is a measure of “funding effort,” or how heavily we are willing to tax ourselves to pay for public education.
Basic tax levy decline
One reason for the decline in funding effort was the systematic property tax cuts. The legislature began applying new principles to state-mandated property tax levies. The main concept is that revenues should equal previous year (with no inflation adjustment), except for growth from new property development. This has driven property tax rates lower nearly each year since 1995.
Income tax deversion
Another reason for the declining funding effort was the diversion of income tax. Utah voters approved a constitutional amendment in 1996 allowing income tax to be shared between K-12 and higher education. It seems to have been sold as a way to benefit higher education, but in reality, it simply created flexibility in the budget. As higher education received more dollars from income tax, general fund dollars were taken away from higher education allowing growth in other areas of the budget, e.g., roads, transportation, etc. Higher education has received no benefit from this change, and previously earmarked K-12 funding is being diverted more and more into other areas.
The consequence of the trend was that the per-pupil funding gap widened. In 1995, the gap between Utah and the next-lowest state (Mississippi) was $320 per pupil, or a 9% difference. In 2005, the next-lowest state (Arizona) was $1,000 higher than Utah, or a 19% difference. If Utah had kept up the funding efforts of 1995, schools would have had $600 million more annually in 2004. Utah per-pupil spending would have been ranked 47th, rather than 51st. This difference in ranking doesn’t sound that significant, but consider that class sizes could have been reduced by as much as 12 students per class!
State Superintendent Larry Shumway said the nearly $4,000 gap between what Utah spends and the national average means larger class sizes, fewer course offerings, fewer counselors, and less professional development for teachers in Utah. Utah Foundation found that lower teacher pay and larger class sizes account for nearly half of the gap between what Utah spends per student and the nation.
“People like to say that money doesn’t make a difference when it comes to student achievement,” Shumway said. “There’s no doubt this amount of money does.
What can we do? Public involvement matters in school funding decisions. The public offers a valuable point of view and link to the schools and community.
We need to examine closely the claim by some that our public schools have enough money. Do schools have enough money to meet high expectations for all students or have schools been set up for disappointment by demanding something without the resources to be successful? Can society hold public schools accountable for high achievement on one hand and yet deny funding for many of the tools that are proven to work? Limited resources cause instability that leads to short-term planning and patchwork solutions. Our elected officials make decisions every legislative session that affect education funding.
Contact your elected officials today, and insist that we renew our commitment to adequately fund public schools! As Lane Beattie, president and CEO of the Salt Lake Chamber said, “We need to find a way to balance the state budget without cutting the very elements that will ensure our long-term economic vibrancy”
Connect!
