It Looks As Though Proposed Ohio School Funding Overhaul May Have to Wait Two More Years

There was a sense of hope on March 25th, when Ohio State Representatives Bob Cupp and John Patterson proposed a new, bipartisan school funding plan for Ohio, a plan that was intended to serve as the House’s education proposal for the 2020-2021 biennial budget, which must be passed by June 30.  We owe these two legislators enormous thanks for overcoming partisan rancor and setting out to try to address school funding injustice in our state.

Under a patched together mess of additions to old formulas, Ohio’s school districts have suffered for years from state funding that hasn’t met the state’s constitutional obligation. The problem has become more serious as state revenue for schools has declined. Following the Great Recession a decade ago, Governor John Kasich and his all-Republican legislature continued the phase out of local business taxes, eliminated the state estate tax and reduced state income taxes. In a state where all tax increases are required by law to be voted, school districts have been forced to ask their residents to increase local property taxes and at the same time to cut programming.  Just as school teachers have been striking all year across other states to highlight outrageous problems with large classes and shortages of counselors, social workers, nurses and librarians, Ohio’s students and teachers have been experiencing the same funding inadequacies.

The proposed Cupp-Patterson Plan was supposed to fund schools adequately—according to a calculation of what it actually costs to provide required services.  It was supposed to be stable without the kind of quirks and changes Ohio school districts have noticed recently in their state funding.  And it was supposed to be equitable by considering not only a district’s property valuation but also the community’s aggregate income in calculating what Ohio calls the local chargeoff—the calculation of what a school district has the capacity to generate in local taxes. Currently in Ohio, 503 of the state’s 610 school districts are on guarantee; they have been getting from the state just what they got last year and the year before and the year before that.  The new Cupp-Patterson plan was designed to flip that situation and restore the awarding of formula-calculated funding to at least 510 districts.

The only problem was, once the computer runs for the state’s 610 school districts were released, it became apparent that many of the state’s very poorest districts, especially poor urban districts with concentrated poverty, ended up with zero new funding—at the same level where they were last year.

This past weekend, the Speaker of the Ohio House, Larry Householder told the Columbus Dispatch that the new plan probably cannot be adjusted quickly enough to be part of Ohio’s 2020-2021 biennial budget:  “I think Cupp-Patterson needs a lot more work… I don’t think it can be done in the time frame for this budget.”

The Columbus Dispatch‘s Jim Siegel explains the problems with the plan and Householder’s concerns: “Over two years, the plan would mean a $280 increase per pupil on average for districts with student poverty rates of at least 60 percent.  Meanwhile, the increase is $392 per pupil for districts with poverty concentration of less than 15 percent.  Several urban districts get little or no additional money.  For Householder, that means more new money for districts that, thanks to local tax revenue, are already funded at an ‘excellent level,’ while less is going to schools where kids have ‘tons of disadvantages.’ That, he said, compounds a revenue imbalance that already exists between poor and wealthy districts. ‘It’s going to create a funding system that’s going to bring a greater amount of inequity between school districts… And there’s no way that it doesn’t.'”

For a fascinating analysis of the complexities that must be addressed by any Ohio school funding plan, I encourage readers of this blog to listen to Jim Siegel’s podcast from last Thursday: Why Is School Funding Still Broken? Siegel talks with two people who bring very different experiences to the conversation. Howard Fleeter, Ohio’s school funding expert has been tracking and advising the legislature about Ohio school finance since 1991.  Julie Wagner Feasel is a member of the school board in Olentangy, a suburban school district just north of Columbus and the fastest growing school district in the state in terms of families moving in.

We learn from Julie Wagner Feasel that even the state’s wealthiest school districts—as measured by property valuation and family income—have been ill-served by our current formula. Olentangy is a wealthy suburban district that for several years has been receiving less state funding than the amount the state awards to private schools for auxiliary services.  Between 2009 and 2014, Olentangy gained 6,000 students at a time when the formula was frozen and the district was on guarantee.  Between 2014 and 2019, the district has been under a “gain cap,” freezing the district’s state funding as it gained another 4,000 or 5,000 students.  Under the proposed Cupp-Patterson formula, which awards what the district needs as measured by its rapid growth, Olntangy will get a significant boost just because its state revenue has been frozen for over a decade.

In the podcast, Howard Fleeter defends the needs of the state’s poorest school districts, those which have lost population but still need additional funds to address the barriers that confront the school districts serving the state’s poorest students. Fleeter suggests that districts serving a high concentration of student poverty need a third more revenue per pupil.  Fleeter disputes Wagner Feasel’s worry that more money would just be absorbed by teachers’ salaries: “Putting resources into classrooms is important. There is important value in teaching, and with salaries, you get what you pay for. To attract good teachers and keep them, you must pay them well… Stability in staff makes a successful school.”

Fleeter also explains why it is enormously complicated to create a state school funding formula that addresses the needs of all 610 of Ohio’s school districts.  We have more big cities than any state except California or Texas—Cleveland, Cincinnati, and Columbus, and then a bit smaller—Dayton, Toledo, and Youngstown, and then a couple of tiers slightly smaller but still big cities.  We have rural Appalachian poverty and then a whole different rural economy on the west side of the state. Then there are the growing outer suburbs and the inner suburbs that are more urban.  How do we calculate equity and adequacy across this array of very legitimate needs?

In his report on the plan’s likely delay, Siegel quotes Ohio House Speaker Larry Householder commenting on the complexity of the problem: “If all we had to do was worry about poor, rural school districts, we could fix that in a heartbeat… But we’ve got everything under the sun in Ohio.”

It will perhaps take another biennial budget cycle before Ohio can create the political will to pass a truly equitable new school funding plan.  In the meantime, however, the Cupp-Patterson plan addresses one concern that could and should be resolved in a stand-alone bill. Ohio has been operating for years with a punitive accountability system beginning with the state report cards that brand the poorest school district with low grades, the third-grade guarantee, the location of charter schools and the EdChoice voucher eligibility in what the state consider academically distressed (low-scoring) school zones and districts, and finally the state takeovers that are currently being seriously challenged in other stand-alone bills.

The Cupp-Patterson Plan proposes to substitute full state funding of school privatization—vouchers and charter schools—for what is now a school district deduction plan.  While today, the child who secures a voucher or leaves for a charter is counted in a school district’s Average Daily Membership, and then carries the voucher or charter amount out of the school district’s budget, in the Cupp-Patterson Plan the state would fully fund the cost of these privatization schemes. In a number of school districts today, the child carries away more in the school district charter school or voucher deduction than the state’s per-pupil funding to that district. Because standardized test scores correlate, in the aggregate, with family and neighborhood economics, the current plan punishes the state’s poorest school districts by locating voucher and charter eligibility in those districts and then extracting the funding for the vouchers and charters from their local budgets. The current plan exacerbates inequity by further reducing the school district budgets in already poor school districts.

The state should not wait two years to address this inequity in the next budget. If the legislature is going to privatize education, the full expense should fall on the state budget and not on the already meager budgets of the state’s poorest school districts.

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