School Funding Declines due to Tax Cutting, Austerity Budgeting, and Paring Down Title I and IDEA

A new report from the Center on Budget and Policy Priorities (CBPP) documents that 35 states continued to spend less in the 2013-2014 school year on their public education formulas than they did before the recession hit in 2008.  Alabama and Oklahoma have cut per-pupil school funding by over 20 percent since 2008.  In 14 states, per-student funding remains fully 10 percent below what those states were spending before the recession. Fifteen states are providing less funding per student than they did a year ago.  At the same time, according to the report, an additional 775,000 students are now enrolled in public schools compared to the 2007-2008 school year. (All CBPP statistics are adjusted for inflation.)

What do these numbers say about our society?  Do we believe it is our public responsibility to educate all children?  Are we committed to expanding opportunity for the children who have been left behind by racial segregation and economic inequality?  Is society’s commitment to educating our children diminishing?  Have we stopped believing in the public schools and hence stopped investing?  Have state elected officials come to accept widespread rhetoric about “failing” public schools, language generated by our national test-and-punish law, No Child Left Behind?  And if so, is disinvestment a smart response?  A moral response?  What do the budget priorities of legislatures across our 50 states say about our society?

Maybe we have come to accept the rhetoric of those who have signed the pledge distributed widely across state legislatures by Grover Norquist and his Americans for Tax Reform. Legislators who sign the pledge promise they will never vote to raise taxes. If states persist in reducing the funds available by cutting taxes, then school funding is likely to diminish over time.  The arithmetic is very simple.  Because public education for over 50 million children in the United States is such a large endeavor, and because 44 percent (according to CBPP’s recent report) of all education funding comes from state governments, public education remains the biggest budget line for most states.   CBPP reminds us: “States have avoided raising new revenues.  States have disproportionately relied on spending cuts to close the very large budget shortfalls they have faced over the last several years, rather than a more balanced mix of spending cuts and revenue increases  Between fiscal years 2008 and 2013, states closed 45 percent of their budget gaps through spending cuts, and only 16 percent of their budget gaps through taxes and fees….”

Here is how the tax cutting has played out in my state, Ohio. Columnist Thomas Suddes, writing for the Cleveland Plain Dealer on June 22, declared, “Republicans grabbed control of the state Senate 30 years ago this November by pledging to cut Ohio’s income tax.  They, and House Republicans, have vowed the same ever since.”  Suddes traces the history of tax cuts—the elimination of the tax on inventory and equipment that shifted the responsibility for paying property taxes  from businesses to homeowners and farmers—the elimination of the estate tax—the 21 percent cut in the income tax in 2005 followed by more income tax cuts including one just signed into law last week.

CBPP notes that local school districts have not been able to make up for cuts in state revenue: “The precipitous decline in property values since the start of the recession, coupled with political or legal difficulties in many localities of raising property taxes, make raising significant additional revenue through the property tax very difficult for school districts.”  While wealthy communities may be able to develop the political momentum to raise local taxes, in poorer communities the residents are less likely  to be able to afford a local levy.

To make matters worse, CBPP reports recent cuts to federal funding for the formula programs that have been a lifeline for local districts for a generation: “Adding to states’ struggles, federal policymakers have cut ongoing federal funding for states and localities, thereby worsening state fiscal conditions.  For example, since 2010, federal spending for Title I—the major federal assistance program for high-poverty schools—is down 12 percent after adjusting for inflation, and federal spending on disabled education is down 11 percent.”  A new summary from Five Thirty-Eight Economics notes that, “The cuts haven’t been evenly distributed.  Most federal education aid targets two groups, low-income and special education students, who are overrepresented in urban school districts.  As a result, urban districts have been hit harder by the recent cuts.” As federal spending fell by 20 percent in the years between 2010 and 2012, “Nearly 90 percent of big-city school districts spent less per student in 2012 than when the recession ended in 2009.”


One thought on “School Funding Declines due to Tax Cutting, Austerity Budgeting, and Paring Down Title I and IDEA

  1. Pingback: School Funding Declines due to Tax Cutting, Austerity Budgeting, and Paring Down Title I and IDEA |

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