Ohio Senate Killed New School Funding Plan: Now We Hear That Money Doesn’t Matter

Ohio Auditor Keith Faber explained on Tuesday that, “The Auditor of State’s Office recently completed a performance audit for the Ohio Department of Education.” Faber says that the purpose is to make recommendations about “economy, efficiency, and/or effectiveness in the areas reviewed…”

One of the subjects of the new report from the Ohio Auditor’s office is the correlation of school districts’ expenditure per pupil with their school performance as measured by standardized tests.  Here, from the Performance Audit Summary, is what the Auditor discovered: “Conclusion: Expenditure per pupil has a loose association with Achievement in Ohio, particularly at the high performing districts.  As total district spending increases, there is no single expenditure category driving this increase.”  Later in the body of the report, the Auditor states: “The analyses in this section indicate that it is not necessary for districts to spend more to get better results. The data show that lower spending districts can achieve at the same level as higher spending districts, a point which parents and taxpayers should take into consideration in their personal decision-making surrounding financial and performance issues in their district. ODE and LEAs should consider if there is a point of diminishing returns in spending, where additional district revenue and expenditures will not necessarily increase student success.”

The Plain Dealer‘s Emily Bamforth digs deeper, explaining to readers that one purpose of the Audit was to discover which practices in high spending school districts are most essential for raising test scores: “The research found there is a low correlation between per-pupil spending and success on the Performance Index, and often higher spending was correlated with a lower index score. The auditor’s report maps the analysis, which shows clusters of high spending compared to low index scores around urban areas, like Cleveland and Cincinnati. The conclusion was used to reinforce recommendations to the Department of Education to review the highest performing districts’ practices to see what could be applied to other schools, and for community members to question spending relative to student success.”

I give Bamforth credit for questioning the Auditor’s conclusions and highlighting some of what is missing in the auditor’s report: “(T)he state auditor’s office claims that spending-per-pupil in districts is not closely correlated with student success. However, this conclusion does not factor in socioeconomic data that might affect student performance. Socioeconomic standing affects outcomes in many areas of life, including education and health, according to the American Psychological Association.  Socioeconomic status includes household income, among other factors.”

Bamforth cites the American Psychological Association, but the body of research examining the correlation of school districts’ aggregate standardized test scores with family and neighborhood economics is long, deep, and overwhelming. Academic research in two areas—(1) the correlation of lower school achievement with socioeconomic opportunity gaps, and (2) the impact of per-pupil spending on student achievement—confirms Bamforth’s skepticism about the new report from Ohio Auditor Keith Faber.

The Research on the Difference Between School Achievement Gaps and Opportunity Gaps

In their 2014 book, 50 Myths and Lies That Threaten America’s Public Schools, educational researchers David Berliner and Gene Glass explain: “For schools to be a powerful solution to the problems of poverty, it would help if an America absent of poverty already existed. We know that the socioeconomic status of students explains most of the variation in educational outcomes. Although there is evidence that some schools with many low-income students are academically successful, there is much more evidence that most schools do not overcome the barriers that stem from low income and low wealth. Health care, housing, stability, and a host of other out-of-school influences greatly affect a child’s academic achievement. Much of the achievement gap in test scores and much of the gap in graduation rates between racial and socioeconomic groups are due to opportunity gaps such as access to medical care, stable housing, and freedom from discrimination.” (Fifty Myths and Lies that Threaten America’s Public Schools, pp. 230-231. The authors cite the research report documenting this conclusion.)

Why Money Matters and Why One Should Not Assume that Successful Programs in “High Achieving” School Districts Are Simply Transferable Best Practices

Ohio’s A-rated school districts on the state’s Performance Index are mostly located in wealthy exurbs. Ignoring the correlation between family and neighborhood economics, the Ohio Auditor’s report seems to suggest that if the state can only identify best practices in high-achieving school districts, these programs can simply be moved to low-achieving districts as a strategy for raising overall achievement as measured by test scores..

In Educational Inequality and School Finance: Why Money Matters for America’s Students, the nation’s best known expert on school finance, Bruce Baker explains, for example, that in a school where student poverty is concentrated, students will always benefit from the most basic—and sometimes very costly—investments. We don’t need the Ohio auditor to tell us what a rich exurban district is doing; instead the state simply needs to budget the needed dollars: “Reducing class size is often characterized as a particularly expensive use of additional school dollars… What we do know… is that ample research indicates that children in smaller classes achieved better outcomes, both academic and otherwise, and that class size reduction can be an effective strategy for closing racial and socioeconomic achievement gaps.” (Educational Inequality and School Finance, pp. 98-99)

Baker reports that education costs more in schools serving poorer students or students with special needs: “(A) substantial body of research addresses how child poverty, limited English proficiency, unplanned family mobility, and school racial composition may influence the costs of achieving any given level of student outcomes. The various ways children are sorted across districts and schools create large differences in the costs of achieving comparable outcomes, as do changes in the overall demography of the student population over time. Rises in poverty, mobility due to housing disruptions, and the numbers of children not speaking English proficiently all lead to increases in the cost of achieving even the same level of outcomes achieved in prior years. This is not an excuse. it’s reality. It costs more to achieve the same outcomes with some students than with others.”(Educational Inequality and School Finance, pp. 198-199)

Ohio legislators, with expert guidance from educational leaders and school finance economists,  just spent over two years developing a new school funding plan. Howard Fleeter, an expert on Ohio school finance, criticized the plan 18 months ago when an early draft was released, because while the first draft addressed the reality that Ohio’s school funding has become increasingly inadequate through a decade of tax cuts, the new plan’s first draft did not invest enough in equity.

In a September 4, 2019 report, Fleeter explained: “National research indicates that economically disadvantaged students typically cost at least 30% more to educate than do non-disadvantaged students. However… Ohio’s current formula only provides additional funding at less than 20% of the base cost…. Funding is an even lower percentage in districts with less than 100% economically disadvantaged students.”  In an appendix to the same report, Fleeter adds that over the past decade, Ohio has systematically reduced funding for school districts serving concentrations of poor children:

• “For much of the past 30+ years, funding for economically disadvantaged students has increased at a far slower rate than the foundation level. Even worse, poverty funding has actually decreased by 13% from FY09 to FY18.
• “Since 2001, the rate of increase in the number of low income students has been nearly 3 times as great as the rate of increase in state funding for these students.
• “Funding for economically disadvantaged students in Ohio has become significantly more structured and restricted in the past 15 years as funding has been focused on programs related to the additional needs of these students and away from unrestricted grants.
• “There has never been an objective study to determine the adequate level of funding for the programs needed to serve economically disadvantaged students.
• “The focus on funding programs for economically disadvantaged students has largely ignored the impact of poverty on the social and emotional needs of low income children. These issues need to be addressed alongside – and arguably before – the academic needs of these children.”

It is ironic that, right now, Ohio Auditor Keith Faber has been asked by the Ohio Department of Education to investigate “economy, efficiency, and/or effectiveness” of the distribution of school funding. After all, less than a month ago, the Ohio Legislature killed the proposed new school funding plan once it had been adjusted to meet Fleeter’s demand that the state would more equitably serve the needs of the school districts serving the state’s poorest students. The Ohio House of Representatives passed the new plan by an overwhelming margin, but the Ohio Senate killed the plan by refusing to vote on it before the session ended.  Ohio Senate President Matt Huffman claims that the Ohio Senate let the plan die because he estimates the plan would have cost $4 billion rather than the $2 billion the plan’s sponsors projected. And now the auditor has conveniently “discovered” that perhaps a school district’s level of expenditure doesn’t really affect student achievement after all.

I suspect that leaders of the Ohio Senate are beginning to lay out their case that we can simply get by by spending less money more efficiently. That’s nonsense. It is just the latest proof that the conservative Republican majority in the Ohio Senate lacks the will to invest in the school districts which serve Ohio’s poorest children.

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Why the New “Fair School Funding Plan” Matters for One Ohio School District: Will the Ohio Senate Let It Die?

In Ohio, the state senate is refusing even to consider a new school funding plan, developed over a period of several years to replace the old school funding system that has become progressively unworkable over the past decade.  Last Thursday, the Ohio House of Representatives passed the proposed new plan by a huge margin: 84-8.  But the Ohio Senate Finance Committee has not even chosen to hold open hearings on its own companion bill, which was introduced early last month as Senate Bill 376.  The current biennial legislative session will end on December 31, and without consideration by the Ohio Senate and passage by that date, the Fair School Funding Plan will die.

If the Ohio Senate refuses to pass this bill, it will be merely one more piece of proof that the incoming senate president, Matt Huffman, and Matt Dolan, who chairs the senate’s finance committee, are committed to supporting children in private and religious schools with publicly funded vouchers at the expense of the 1.6 million children and adolescents who are enrolled in our state’s public schools.

The testimony I submitted last month to the Ohio House Finance Committee on behalf of the Heights Coalition for Public Education details why passage of the new plan is so important to one school district—the Cleveland Heights-University Heights City Schools, in an inner-ring suburb of Cleveland. Here is that testimony.

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The Heights Coalition for Public Education commends the sponsors in both chambers of the Ohio Legislature for bringing forward the proposed Fair School Funding Plan, defined by Substitute HB 305. The bill’s original sponsors described the new plan’s necessity when it was introduced a year and a half ago: Eighty percent of the state’s school districts, 503 of 610 districts, were capped or had fallen onto guarantee. Today, neither base cost nor categorical state school funding comes close to approximating the actual cost of K-12 schooling in Ohio.

Substitute HB 305 enhances equity, increases the state’s investment in the under-resourced public schools and school districts with concentrations of the state’s poorest children, and ends school district deduction funding for charter schools and tuition vouchers for private school tuition.

We commend the sponsors of the bill for revising the original plan to enhance equity. For measuring local capacity, you have expanded the range of the sliding scale to ensure that the state better distinguishes wealthy school districts from the school districts with low property tax bases or those which struggle to pass levies because their residents are impoverished. And you have increased categorical aid for economically disadvantaged students from $272 per pupil to $422 per pupil, an urgently important change. The purpose of the state school funding plan, in accord with the provisions of the Ohio Constitution, is to create a system that ensures that all children are provided an equitable opportunity to learn. The late political theorist, Benjamin Barber defined educational equity: “Education need not begin with equally adept students, because education is itself the equalizer. Equality is achieved not by handicapping the swiftest, but by assuring the less advantaged a comparable opportunity. ‘Comparable’ here does not mean identical…” (An Aristocracy of Everyone, p. 13)

For many years—through mechanisms like the state report card which rates and ranks school districts; the third grade guarantee; the state takeovers in Youngstown, Lorain, and East Cleveland; and the assignment of charter schools and vouchers, all based primarily on aggregate standardized test scores—Ohio has doled out punishments for schools and school districts that serve concentrations of the state’s poorest children. However, a mass of educational research documents that aggregate standardized test scores for any school or school district correlate with family and neighborhood income and are a poor measure of school quality. In September of 2019, the Cleveland Plain Dealer published a stunning analysis, by the newspaper’s data analyst Rich Exner, of the school district grades awarded by the state of Ohio on the 2018-2019 state report cards. Exner’s bar graphs present a series of almost perfect downward staircases, with “A” grades for school districts in communities with high median income and “F” grades for the school districts in Ohio’s poorest communities. The correlation of academic achievement with family income has been demonstrated now for half a century, but too often Ohio policy has blamed public school teachers and administrators instead of using the resources of government to assist struggling families who need better access to healthcare, quality childcare, better jobs, food assistance, and better resourced public schools.

Substitute HB 305 eliminates school district deduction funding for the state’s vouchers and charter schools, and would, therefore remedy what has become a primary source of inequality in Ohio’s system of funding public schools. Because, in Ohio, students in so-called failing schools qualify for vouchers, and because the siting of charter schools is limited to districts with lower test scores, “school district deduction” funding for these programs punishes the very school districts that serve concentrations of children living in poverty. Not only will vouchers and charter schools drain $2,352,881,306 overall from the budgets of Ohio school districts for vouchers and charters in FY 21 and FY 22, according to William Phillis, executive director of the Ohio Coalition of Equity and Adequacy, but the cost of these school district deductions for vouchers and charters is inequitably distributed across the state’s 610 school districts. School district deduction funding, which is said to provide students an escape from so called “failing” schools, inequitably sucks money out of the local budgets of school districts which serve children who need expensive additional services. Many of these districts also have the lowest capacity to raise local revenue. In many cases, the students carrying away the vouchers have never been enrolled in the districts from which they are carrying away the money.

In a white paper last April , a co-convener of the Heights Coalition, Susan Kaeser explains why specifically the EdChoice voucher program, funded by school district deduction, is inequitable: “The financial burden of EdChoice vouchers is not shared evenly by school districts across the state, punishing some districts and not others. This disparity is made worse by the reality that the majority of students in the districts most affected by vouchers live in poverty and are not white…”

The Heights Coalition advocates for the public schools in the Cleveland Heights-University Heights City School District. whose school district budget has been devastated in recent years by EdChoice vouchers. Why?  First is the clamor for vouchers among a growing community of religious families whose children have never been enrolled in the district’s public schools. The second reason is the increase over the years in impoverished students currently enrolled in our public schools. According to the Ohio Department of  Education’s 2019 Cupp Printout, 99.98 percent of our students are currently designated as disadvantaged.

Here is what the school district deduction for EdChoice vouchers has done to our school district. In a PowerPoint presented to the Cleveland Heights-University Heights Board of Education last month, the school district’s treasurer, Scott Gainer explains that in our school district the number of students claiming vouchers—and the dollars being deducted from our school district’s budget—have grown precipitously. Much of the growth occurred when the Legislature, in the FY 20-21 biennial state budget, expanded eligibility to all students in grades 8-11 in EdChoice designated schools. The amount diverted from our school district budget to EdChoice vouchers has grown from $2,256,017 in 2017;  to $3,232,403 in 2018;  to $4,187,249 in 2019;  to $7,074,249 in 2020;  to $9,017,250 in the current 2020-2021 school year.

Currently 1,792 students are carrying vouchers out of our school district budget at the expense of the 4,810 students enrolled in our public schools. This year EdChoice voucher students are diverting to private and religious schools 45 percent of the school district’s state’s foundation school funding despite that they represent only 27 percent of the combined total of students the state counts as part of the district.

While 1,240 of vouchers granted by the state this year are renewals, which means that the district continues to collect state aid to cover a portion of the cost of each voucher, students applied for 552 new vouchers for this school year—a year when the state budget allocation is frozen at the FY 2019 level. For these 552 students, the district is forced to cover the full cost of their vouchers—$2,566,800—out of the local school district budget.

And while the legislature claims that the vouchers are designed to help students and their families be able to make a choice to leave public schools, Gainer documents that in our school district during the current school year, 1,699 of the 1,792 students carrying the vouchers out of our school district—roughly 95 percent—have never been enrolled in our public schools. In essence, this means that in our school district, and across Ohio, the Legislature is forcing local public school districts to undertake an unexpected expense: paying for private and religious education.

In the DeRolph decision, the Ohio Supreme Court charged the state legislature to create a system that is no longer overly reliant on the passage of local operating millage. Currently in our district, EdChoice diverts 45 percent of state foundation funding out of our school budget and forces our voters to replace this funding with additional local operating levies.

The Heights Coalition for Public Education commends you for considering Substitute HB 305. The Fair School Funding Plan is a comprehensive blueprint which, when funded, will ensure that public schools across Ohio can provide an opportunity to learn for all of our children. We urge you promptly to enact the Fair School Funding Plan.

Will the Biden Administration Provide Leadership to Address Long School Funding Crisis?

Here in Ohio, during the current lame duck session, legislators are considering a new school funding formula. The Cupp-Patterson Fair School Funding Plan has been in the making for almost two years (See here and here.),  but even now as the plan comes to a vote before December 31, the end of the current legislative session, it has been difficult to build a wave of political will for justice for Ohio’s children.

The Ohio Legislature appears split. There is support in the Ohio House for fairer and more generous school funding, but key members of the Ohio Senate want to protect private school voucher programs and delay help for the state’s students in public schools. Even if the Fair School Funding Plan passes, a solution may be illusory.  How will it ever be funded? After a series of state tax cuts early in the current decade and in the midst of a COVID-19 recession, even if the new plan is set in place, making it operational will require a six-year phase in while legislators look for the necessary funds to pay for it.

The mere release of the proposal for the Fair School Funding Plan helped call the public’s attention to the state’s utter failure in recent years to distribute constitutionally mandated state funding fairly across Ohio’s public schools. Eighteen months ago, when the plan was released, we learned that 503 of the state’s 610 school districts had been either capped or on hold-harmless guarantee. These categories mean that despite changes in the number of students they serve or the special needs of their student populations, 503 school districts had, for years in many cases, been receiving the same amount of state funds they got last year and the year before that. Then, because of a shortage of state funds, the biennial state budget for FY 20-21, froze formula state school aid for every one of Ohio’s school districts at the FY 2019 level.

The problem is broader than Ohio, however, and several recent books expose and explain that we’ve just finished a decade of falling financial support for U.S. public schools.

In  2018, professor at Rutgers University and national school finance expert, Bruce Baker published Educational Inequality and School Finance: Why Money Matters for America’s Students.  Baker examines funding trends in American public education since the Great Recession: “The sharp economic downturn following the collapse of the housing market in 2007-08, and persisting through about 2011, provided state and federal elected officials a pulpit from which to argue that our public school systems must learn how to do more with less. It was the ‘new normal,’ Secretary of Education Arne Duncan declared. This idea was embraced by pundits like David Brooks and by conservative organizations like the American Enterprise Institute… As part of the U.S. Department of Education’s campaign, it unveiled on its website a series of supporting documents explaining how public school districts can live within that new normal.

Baker continues, explaining that state governments did even more damage: “Meanwhile, governors on both sides of the aisle, facing tight budgets and the end of federal aid that had been distributed to temporarily plug state budget holes (the American Recovery and Reinvestment Act of 2009 that provided some relief during the recession) ramped up their rhetoric for even deeper cuts to education spending… Notably the attack on public school funding was driven largely by preferences for conservative tax policies at a time when state budgets experienced unprecedented drops in income and sales tax revenue. But the rhetoric has persisted, and perhaps even escalated, despite modest but steady economic recovery.  I’ve found that only… (twelve) states had increases in current expenditures (on average) from 2008 to 2015: Washington, Iowa, Minnesota, Nebraska, Pennsylvania, New York, New Hampshire, North Dakota, Connecticut, District of Columbia, Illinois, (and) Alaska.”  (Educational Inequality and School Finance, pp. 4-5)

How did neoliberal Democratic and conservative Republican school “reformers” justify reducing the funding necessary for hiring teachers and guidance counselors? “The response of the education reform community to the narrative that U.S. public schools are inefficient and noncompetitive, a narrative they themselves largely crafted and promoted, has been to propose quick-fix remedies and magic elixirs, which fall more broadly into the category of ‘cost-free solutions.’ The theory of action guiding these remedies and elixirs is that public, government-run schooling can be forced to operate more productively and efficiently if it can be reshaped and reformed to operate more like privately run, profit-driven corporations…. Broadly, popular reforms have been built on the beliefs that the private sector is necessarily more efficient; that competition spurs innovation… (and) that data-driven human capital policies can increase efficiency…. One core element of such reform posits that U.S. schools need market competition to spur innovation and that market competition should include government-operated schools, government-sanctioned (charter) privately operated schools, and private schools.”  (Educational Inequality and School Finance, pp. 6-7)

In their new book, A Wolf at the Schoolhouse Door, Jack Schneider and Jennifer Berkshire devote an important chapter to reviewing the collapse of state school funding in the dozen years since 2008: “Education… represents a mere drop in the federal spending bucket: roughly $60 billion. By comparison, just short of a trillion dollars is spent on social Security. Another trillion is spent on the combined programs of Medicare, Medicaid, and the Children’s Health Insurance Program… Of each dollar spent on education in the United States, just 8 cents comes from the federal government… The real spending action in education takes place at the state and local level. States pick up the tab for approximately 47 cents of each dollar spent on public education, while local communities contribute an additional 45 cents, primarily through property taxes. In an effort to starve the beast, then, conservatives have worked at all levels of government to reduce taxation. This has been a logistical challenge, but they have pursued it through networks like the American Legislative Exchange Council and the State Policy Network..” (A Wolf at the Schoolhouse Door,  p. 34)

Schneider and Berkshire explain the punitive education budget policies in some states after the recession was over: “Almost every state reduced spending on public education during the Great Recession, but some states went much further, making deep cuts to schools, while taking aim at teachers and their unions… Moreover, states including Arizona, Kansas, Michigan, and North Carolina also moved to permanently reduce the funds available for education by cutting the taxes that pay for schools and other public services.  In Wisconsin, Governor Scott Walker took aim at education through Act 10—what was first called the ‘budget repair bill.’  Act 10 is mostly remembered for stripping teachers and other public employees of their collective bargaining rights.  But it also made $2 billion in cuts to the state’s public schools. Though Wisconsin, like many states, already capped the amount by which local communities could raise property taxes to fund schools… Walker and the GOP-controlled legislature imposed further limits, including restricting when and how local school districts can ask voters for additional help funding their schools.” (A Wolf at the Schoolhouse Door,  pp. 35-36)

Finally in 2018 and 2019, public school teachers themselves challenged and exposed the consequences—in the schools where they were working—of years of tax cutting, fiscal austerity, and privatization. Because of teachers’ strikes and statewide walkouts, it is beginning to look as though we’ve reached a decisive moment when, perhaps, it will be possible to capture national and state education policy back from the ideologues and privatizers.  Striking teachers across the states exposed what had been invisible: staffing shortages that left children stuffed in classes of 40 students and that left children in public schools without an adequate number of counselors, school psychologists, school nurses and librarians.

Schneider and Berkshire describe how the Red4Ed walkouts and strikes by teachers across the states fixed the public’s understanding on appalling conditions across public schools: “The recent wave of teacher walkouts from California to North Carolina, and the widespread public support they attracted, indicate just how unpopular the cost-cutting crusade has become. There is simply no constituency demanding huge class sizes, four-day school weeks, or the use of uncertified educators to stanch a growing teacher shortage in states where pay has plummeted.  In low-spending states like Arizona and Oklahoma, what began as teacher rebellions morphed into broad-based political movements against austerity. For those ideologically predisposed against public education, these public revolts represent a profound challenge. Starving the beast, after all, requires that the public be willing to elect politicians to cut taxes, shrink services, and dismantle public institutions.” (The Wolf at the Schoolhouse Door, p. 43)

Finally, in his new book, Schoolhouse Burning: Public Education and the Assault on American Democracy, constitutional scholar Derek Black examines the future of public education at the end of what has been an ideologically and fiscally precarious decade.  Black believes the wave of Red4Ed strikes may presage a new era if the energy of the movement can be sustained: “As the moniker RedforEd suggests, the pro-public education and teacher movement also defies conventional politics. In 2019, 84 percent of public school parents indicated that they would support teachers who went on strike over school funding issues…  The general public beyond those directly connected to schools has also been steadfast in its support for public education and teachers… These numbers and teacher protests scared those levying attacks on public education. They may, in fact, have pressed their advantage too far for too long. Their messaging succeeded for the better part of a decade, but their messaging could not hide underlying reality.”  (Schoolhouse Burning, pp. 245-24)

The education plan on which President Elect Joseph Biden campaigned shines a bright light on the funding problems which have quietly undermined American public education. Biden pledged to triple funding for Title I, the program awarding federal compensatory funding to schools serving concentrations of poor children.  He proposed within 10 years to fulfill a decades old Congressional promise to cover 40 percent of special education costs under the Individuals with Disabilities Education Act, when today Congress is covering approximately 14 percent of the cost. He pledged more wraparound Community Schools, more federal funding for pre-Kindergarten for poor children, and more support for other programs to address child poverty. This is an agenda to help public schools serve their students.

Of course the President alone cannot accomplish a quick turnaround in education funding. State governments are primarily responsible for school finance, and injustice in school funding will remain a problem in many far right states. But if President Biden can secure support from Congress to enact his education plan along with the federal tax increases for wealthy Americans and corporations he has said are needed to pay for it, his leadership will continue to reshape the narrative.  His leadership has the potential to help build the political will for increasing opportunity for all of America’s children and especially for children in our poorest urban and rural communities.

Biden’s first step must be to choose an education secretary who will help us remember our constitutional commitment to strive for equity, opportunity, and justice for all children in America’s public schools.

Ohio Legislature Looks to Adopt New School Finance Plan During 2020 Lame Duck Session

The Ohio Legislature will waste no time before trying to enact—before the end of the current legislative session at the end of December—a Fair School Funding Plan, which was proposed in the spring of 2019. The Ohio House has been holding hearings for months on what, this week, became Substitute House Bill 305. Last week Senate Education Chair, Peggy Lehner, and 14 additional co-sponsors introduced a companion bill, Senate Bill 376.

The Columbus Dispatch‘s Catherine Candisky summarizes the Ohio Legislature’s attempt to move forward immediately to pass the new school funding blueprint: “A bipartisan group of state lawmakers on Friday unveiled a complex and long-sought overhaul of Ohio’s school funding system that would provide another $1.99 billion a year—about a 24% increase—to K-12 schools when fully implemented. The proposal to change the way state aid is calculated and distributed to public schools establishes the per-pupil cost of ‘a quality education,’ and determines how much funding each local community should be able to cover itself and how much should come from the state. It aims to keep overall funding levels relatively even across the state despite widely varied tax bases across Ohio’s more than 600 school districts.”

The term-limiting of several of the plan’s co-sponsors is accelerating the timeline for seeking the bill’s passage before the end of 2020.

Here is the primary reason why a new school funding plan is needed in Ohio. Materials released when the new funding plan was introduced in the spring of 2019 showed that before the current biennium, in 503 of the state’s 610 school districts, state school funding was capped or the district had fallen onto a hold-harmless guarantee. Then the current biennial budget for FY 2020-2021, froze the state’s contribution to state foundation school funding at the FY 2019 level with no increase to cover normal inflation.

The purpose of a state school funding plan, in accord with the provisions of each state’s constitution, is to create a system ensuring that all children, no matter where they live, are provided an equitable opportunity to learn. The late political theorist, Benjamin Barber defined educational equity: “Education need not begin with equally adept students, because education is itself the equalizer. Equality is achieved not by handicapping the swiftest, but by assuring the less advantaged a comparable opportunity. ‘Comparable’ here does not mean identical…” (An Aristocracy of Everyone, p. 13)

The Fair School Funding Plan Would Make Ohio School Funding More Equitable

The plan the Ohio Legislature now hopes to pass has been modified from an earlier version to enhance equity.  It directs additional funding to the state’s poorest school districts, particularly those in urban areas where poverty is concentrated. The plan was developed through a comprehensive costing out study to establish an ongoing method for defining the per-pupil base cost, which the formula then modifies through a calculation of each school district’s local capacity to raise school revenue. Local capacity in this plan combines two measures: (1) each school district’s local property valuation and (2) the income of the school district’s residents (as a proxy for their capacity to vote to pass local levies). Modifications to the original plan have expanded the calculation that divides the state’s school districts into five tiers based on local school district wealth categories. Very significantly, the revised plan increases categorical aid for economically disadvantaged students from $272 per pupil to $422 per pupil.

The Fair School Funding Plan Eliminates School District Deduction Funding for Charters and Vouchers

The Fair School Funding Plan does nothing to reduce the extensive school privatization that already exists in Ohio.  Ohio’s original school voucher program is the second oldest in the country, and the legislature has multiplied the number of statewide school voucher programs at public expense.  Neither does the new plan control the number of charter schools nor does it enhance regulation of what has proven to be a charter sector filled with conflicts of interest and fraud.

However, the new plan significantly shifts the funding mechanism for some of these programs. In Ohio, while some of the voucher and charter programs are currently funded out of the state budget, the legislature has recently expanded the funding of statewide EdChoice vouchers by deducting dollars right out of school districts’ local budgets for students to carry away in vouchers for private school tuition.

In the current biennial budget, passed in the summer of 2019, the Legislature expanded EdChoice vouchers by adding new grade level cohorts of students who qualify in designated schools and also by expanding the number of schools the state deems “EdChoice designated.” Because the burden of EdChoice falls most heavily on public school districts serving poor children, the expansion of EdChoice, which is funded by the local deduction method, poses serious equity concerns, by extracting essential dollars that could otherwise be used for reducing class size and hiring counselors, social workers, school nurses, and librarians.

The proposed Fair School Funding Plan eliminates the school district deduction funding mechanism for the state’s vouchers and charter schools and would, therefore, remedy what has become a primary inequity in Ohio’s system of funding schools. Here is the sponsors’ explanation of Substitute HB 305: “‘Enrollment’ used in HB 305 means the number of students actually being educated by the district. Students attending community schools (Ohio’s name for charter schools), other schools through one of the state scholarship programs (Ohio’s name for vouchers), or court-placed in schools outside the district of residence would be counted for funding purposes in the school where they are being taught. Students open enrolling into a district also would be counted as students of the district where they are taught.  In all of these instances, funding would go directly (from the state) to the educating entity.”

The Fair School Funding Plan’s elimination of the school district deduction as the funding mechanism for privatized vouchers and charter schools  is one of the urgently important reasons for the Legislature to pass Substitute HB 305 and SB 376.  Recently the Executive Director of the Ohio Coalition for Equity and Adequacy of School Funding, Bill Phillis documented that in FY 21 and FY 22, “$2,352,881,306 will be deducted statewide from local school district budgets for vouchers and charters.”

In the Cleveland Heights-University Heights City Schools, the district where I live, the amount of the local school district deduction for EdChoice vouchers has grown explosively: from $2,256,017 in 2017;  to $3,232,403 in 2018;  to $4,187,249 in 2019;  to $7,074,249 in 2020;  to $9,017,250 in the current 2020-2021 school year. This year students with vouchers are carrying away 45 percent of the school district’s state foundation funding to pay private and religious school tuition. Ninety-five percent of the students carrying vouchers out of the CH-UH public school budget this year have never been enrolled in the district’s public schools. In essence, this means that in the CH-UH school district, and across Ohio, the Legislature has been forcing local public school districts to undertake an unexpected expense: paying for private and religious education. 

Will the Ohio Legislature Raise the Funds to Pay for a Six Year Phase-In of the Fair School Funding Plan?

The caution about the new plan is that sponsors call it a blueprint, but they are clear that it will not come with immediate funding appropriations to cover the cost.  A six year phase-in is anticipated.

Funding the new plan will pose a major challenge as, after a decade of tax cuts during Governor John Kasich’s tenure, the state lacks the necessary revenue to cover the cost of the new plan. The worry about funding is complicated by projections, reported last Friday by the Plain Dealer‘s Jeremy Pelzer, that Ohio will face a state budget shortfall in the current fiscal year of $2 billion (before June 30, 2021) due to the COVID-19 recession which is expected to continue and perhaps intensify unless the pandemic can be brought under control through testing and contact tracing until a vaccine is widely available. Late last spring, after the pandemic caused business shutdowns and widespread layoffs, Governor Mike DeWine was forced by a recessionary collapse in state revenue to cut $330 million out of the already appropriated FY 20 state K-12 education funding. This money, which school districts had already allocated for specific expenses, disappeared before June 30.

Despite Worries About Paying for the 6-Year Phase-In, the Legislature Should Adopt the Fair School Funding Plan.

Despite concerns about how the Legislature will fund the six-year phase-in of the plan, it is important that a bipartisan coalition of Ohio legislators has come together to create a blueprint school funding formula, which would fulfill the Legislature’s obligation under the state constitution to provide all of Ohio’s children equal access to educational opportunity. It will be up to the public to support the full funding of the new plan.

New Ohio Report: Cupp-Patterson Plan Creates Adequate School Funding but Must Be Corrected for Equity

Ohio’s legislature will soon hold hearings on a new, much touted, desperately needed, bipartisan school funding plan. The plan was developed and proposed by Rep. Robert Cupp (R) and Rep. John Patterson (D), and has now been formally introduced as House Bill 305.

Ohio’s current school funding formula is so dated and so badly underfunded that 503 of the state’s 610 school districts are currently either capped or on guarantee; they have been receiving 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 new formula was developed to establish a base cost per enrolled student, an amount which every district would receive through combined state and local funding. Everybody agrees that the new formula would begin to create an adequate funding floor.

But huge concerns have arisen since last spring when the formula was first announced. Once the computer runs were released to show how the new formula would treat each of the state’s 610 school districts, it became apparent that many of the state’s very poorest districts—especially poor urban districts with concentrated poverty and rural districts—would end up with meager funding increases, or, in some cases, no additional funding at all, while some of the state’s wealthiest exurban school districts would receive huge increases in state funding.

While the new Cupp-Patterson Plan produced an adequate school funding floor, it failed to achieve equity. Part of the reason is obvious: the outer ring suburbs are rapidly growing, and a higher per-pupil state funding system will add funding as students move to a school district. But until now, nobody has clearly explained what is causing the proposed formula to deny additional funding to the state’s poorest school districts—three of them currently being punished by autocratic state takeover, ten of them threatened with state takeover, and Cleveland under its own form of state supervision.

Last week, however, Howard Fleeter, an expert on Ohio school finance since the early 1990s, published a report for the Ohio Education Policy Institute to evaluate the proposed Cupp-Patterson formula.  In his new paper, Fleeter dissects the history and complexity of the state’s foundation formula along with the history and complexity of the way the state calculates categorical funding—the special funds the state awards to school districts in addition to basic aid for special services—special education, gifted, English learners, transportation, career-technical, and students in poverty.

Fleeter’s paper is extremely technical.  Even as a non-expert reads the new report, however, what becomes clear is that the very complexity of the calculations and the choice of particular factors has disadvantaged the state’s poorest school districts.

One Problem with the Foundation Base Cost Calculation

Any school funding formula is comprised of a state contribution and a local contribution which together add up to a base cost amount. The purpose of the formula is to deliver additional state aid to school districts whose fiscal capacity is lower. While he affirms much of the way the basic aid formula is calculated, Fleeter criticizes one area of the calculation. His concern is the way community median income is being used to calculate the local contribution to the formula. The proposed formula considers the size of the school district’s property tax base and also measures community income as a proxy for the community’s capacity to pass local operating levies.  The assumption here is that wealthier voters will more easily be able to afford to vote for tax levies.

The proposed formula measures income through a complicated calculation called local capacity percentage which is based on median income. Fleeter explains that the way the tiers are set fails entirely to distinguish high income from very poor communities. Fleeter provides an example: “Northern Local School District in Perry County has a median income of $41,826 while Orange City School District has a median income of $93,421 (more than twice as much), and yet both have the same local capacity percentage, which is clearly inequitable.”  The Northern Local School District in Perry County is the extremely poor rural school district where the DeRolph school funding equity lawsuit originated.  Orange City School District includes the very wealthiest communities in Cuyahoga County—greater Cleveland.

Problems with the Calculation of Categorical Funding

Fleeter also considers the mass of calculations which determine categorical funding levels, and he devotes much of his analysis to the way the proposed formula treats the school districts which serve a large number or a concentration of students living in poverty. Ohio’s current formula fails to support these districts even as the state punishes them with punitive measures—most notably state takeover.  Fleeter believes Ohio needs to assist these school districts with significant additional resources: “National research indicates that economically disadvantaged students typically cost at least 30% more to educate than do non-disadvantaged students. However… Ohio’s current formula only provides additional funding at less than 20% of the base cost…. Funding is an even lower percentage in districts with less than 100% economically disadvantaged students.”

In an appendix, Fleeter traces a history of state funding problems for school districts serving children in poverty: “The following points provide a summary of the main issues relating to funding for economically disadvantaged students in Ohio:

• For much of the past 30+ years, funding for economically disadvantaged students has increased at a far slower rate than the foundation level. Even worse, poverty funding has actually decreased by 13% from FY09 to FY18.
• Since 2001, the rate of increase in the number of low income students has been nearly 3 times as great as the rate of increase in state funding for these students.
• Funding for economically disadvantaged students in Ohio has become significantly more structured and restricted in the past 15 years as funding has been focused on programs related to the additional needs of these students and away from unrestricted grants.
• There has never been an objective study to determine the adequate level of funding for the programs needed to serve economically disadvantaged students.
• The focus on funding programs for economically disadvantaged students has largely ignored the impact of poverty on the social and emotional needs of low income children. These issues need to be addressed alongside – and arguably before – the academic needs of these children.”

Fleeter examines several reasons why the new school funding plan does not solve the problem.

Historically, the state directed assistance to school districts serving very poor children with what was called Disadvantaged Pupil Impact Aid—later replaced after the DeRolph litigation with Targeted Assistance and Capacity Aid. In a series of calculations, Fleeter demonstrates that under the new Cupp-Patterson plan, the total of $987.3 million for these two programs, “would still be 20.3% below the actual FY 19 post-cap funding levels for Targeted Assistance and Capacity Aid.”

In the first place, the targeting of funding for disadvantaged students is part of the plan’s six-year phase in.  Over the period of the phase in, school districts would not receive all of the money until the whole plan were fully phased in. “Additionally, the state average base cost amount would increase to $7,190 in FY 20 under the Cupp-Patterson plan. Thus, the per-pupil amount of economically disadvantaged funding received in FY 20, even if there were no phase-in, would only be 25.6% of the new base cost.”

Problems with the proposed formula also derive from the way it counts students for Targeted Assistance. The plan uses overall enrollment instead of Average Daily Membership to calculate Targeted Assistance. (Overall enrollment counts students in charter schools and students receiving vouchers.)  The substitution of overall enrollment for ADM affects the mathematical calculation, making urban districts look wealthier than they actually are. Changing the method of counting students deprives school districts of millions of dollars annually.  For example, Cleveland would lose $27.6 million from the amount of Targeted Assistance it currently receives; Columbus, $27.1 million; Dayton, $21.0 million; Toledo, 19.1 million; Youngstown, $13.54 million; Cincinnati, $11.4 million; Lorain City, 10.1 million; Euclid, $4.7 million; Lima, $4.0 million; and Mansfield, $3.0 million.

Fleeter comments “When providing testimony in support of their plan, members of the Cupp-Patterson work group explained the above outcomes by saying that the number of students educated in the district is in fact the more appropriate measure for determining wealth than is the number of students who live in the district. While this is certainly true for the calculation of an input-based base cost measure, it is less clear for a measure that is designed explicitly to help less wealthy districts keep pace with their wealthier neighbors in providing educational opportunities for their students. Moreover, regardless of the theoretical merits of one student count versus another for making a per-pupil wealth calculation, the funding impact was clearly that high poverty urban districts lost so much revenue from Targeted Assistance under the initial Cupp-Patterson proposal that most of them ended up on the guarantee or with much smaller revenue increases than did the wealthier districts in the state.”

Again and again, Fleeter emphasizes the urgent need for the state to address the needs of school districts serving concentrations of poor children. He castigates legislators for proposing a formal study of the needs of students in these school districts but failing to fund such an investigation: “Finally, HB 305 would direct the state to undertake a study of the true cost of educating economically disadvantaged students in Ohio. Such a study has never been undertaken in Ohio. The final version of the FY 20-21 state budget did include a provision directing the Ohio Department of Education to oversee such a study; however, no funding was earmarked for this purpose. The state needs to be encouraged to find a way to fund and complete these studies in the FY 20-21 biennium.”

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.