Ohio Public School Funding Looks Precariously Insecure As Ohio Senate Debates the State Budget

It is becoming clear that Ohio Senate President Matt Huffman and Senate Finance Chair Matt Dolan are not committed to funding the state’s public schools adequately and equitably. What clues can we see that the leaders of the state senate want to support a vast expansion of private school vouchers instead of funding the continued phase-in of the Fair School Funding Plan?

This blog will take a day off its regular schedule.  Look for a new post next Tuesday, June 6, 2023.

The first clue is last week’s intimidating and threatening demand by Huffman that the more than 100 plaintiff school districts suing the state in the Vouchers Hurt Ohio lawsuit must report to the legislature what they are spending on the lawsuit to block the state from diverting millions to private school vouchers each year from the state’s school foundation budget.

Senate President Huffman had his attorney Matt Oyster ask Auditor Keith Faber to demand that the Vouchers Hurt Ohio plaintiff school districts report how much they are spending on legal fees.  The Dispatch‘s Anna Staver quotes Oyster’s instruction to Keith Faber: “To aid in the Senate’s evaluation and deliberation of current policy and funding issues and enhance the transparency of the use of public resources, we respectfully request the assistance of the Auditor of State… The Senate seeks a report … detailing Ohio school district… funding or financial support of the litigation over the past two fiscal years.”  Huffman clearly intends for members of local school boards to understand that the Vouchers Hurt Ohio Lawsuit is somehow connected to the Senate’s  state budget deliberations with the goal of threatening these school districts and encouraging them to drop out of the lawsuit. It is also a reminder of Huffman’s top priority: expanding vouchers at the expense of public school funding in the state budget.

The Plain Dealer‘s Laura Hancock quotes Cleveland Heights-University Heights school board member Dan Heintz promptly comparing the district’s legal fees for joining the lawsuit to the outrageous annual cost of vouchers for that public school district: “This is all public record. Cleveland Heights-University Heights was losing $10 million a year to vouchers. We are investing less than $11,000 a year to protect our schools, our families, our students, and our taxpayers.” Heintz is describing the  lawsuit’s purpose: shielding the public schools from the legislature’s explosively large diversion of school funding dollars to vouchers in a state whose constitution promises that the state will provide “a thorough and efficient system of common schools throughout the state.”

Plain Dealer editor, Chris Quinn, not usually given to hyperbolic rhetoric, exploded angrily as he wondered how Huffman can condemn Ohio’s public school districts for trying to protect the state dollars guaranteed in the Ohio constitution. Here is Quin last Wednesday, in the May 24, Plain Dealer Today in Ohio podcast, Ohio Lawmakers, Auditor Try to Intimidate School Districts Suing the State Over Funding: “The schools all have a role here in fighting to make sure there’s equitable education… It’s getting clearer and clearer that the Republican supermajority created by gerrymandering is changing the whole way this state is governed, and people are no longer in charge. Every step these folks take is to reduce any chance of anybody questioning what they do. And Matt Huffman is the leader of it all. He is probably the most sinister politician we’ve seen in twenty years.”

In a column published on Sunday in both the Columbus Dispatch and the Cleveland Plain Dealer, columnist Thomas Suddes elucidates the problem: “One of the great Statehouse public relations cons of recent times is the claim that Ohio’s Republican-run General Assembly is conservative. Not so. It’s revolutionary, pushing the state and its power into more and more features of everyday life in Ohio… One by one, the General Assembly is making war on the common institutions that make Americans Americans and Ohioans Ohioans, starting with public schools, whose major fault seems to be that many teachers are unionized… So, beginning with the 1995-1997 state budget, and initially only in the Cleveland Metropolitan School District, GOP legislators created a ‘pilot’ private school voucher plan that in the 28 years since has become five separate state voucher programs.  According to the Legislative Service Commission, the five programs cost the state $555 million in the fiscal year that ended last June. That’s money that otherwise could have gone to public schools.  And the legislature wants to further expand school vouchers in Ohio, regardless of the Ohio Constitution’s demand that the legislature must provide ‘a thorough and efficient system of common schools’—public schools—‘throughout the state.'”

A second clue about the pro-voucher/anti-public school intentions of Ohio’s state senate leaders is that Huffman seems to question whether school districts even need the increased state funding at the heart of the new Fair School Funding Plan, now part way through its six year phase-in.  Huffman continues to point out that school districts are operating with carry over balances.  The Plain Dealer‘s Laura Hancock describes Huffman’s claim that school districts have plenty of money: “He… said that he doesn’t buy into the idea that the Fair School Funding Plan has a six-year plan, even though the plan’s architects built it that way. He said too many school districts are sitting on significant cash reserves.”

While Huffman appears not to grasp how Ohio school funding works, the mothers and fathers across our state who have devoted months-long parts of their lives trying to convince their neighbors to pass school levies can tell you that school districts have to maintain carry-over balances because their school districts have no built-in way to accommodate inflation between school levies. Ohio House Bill 920, a tax freeze law embedded into the Ohio constitution in 1980, provides that each year in perpetuity a particular local school operating levy will produce the dollar amount approved by the voters on the day the levy passed—despite that as time passes, inflation drives up the school district’s costs. The school board, superintendent, and school treasurer have to figure out how to stretch the local revenue being produced by that levy over several years—by carefully managing a carry over balance—to ensure that the local voters do not have to go to the voters with a new school district operating levy every year. I wonder if Senate President Huffman and Senate Finance Chair Dolan ever tour the public schools in their own districts to observe the fiscal realities.

Discussion of the ongoing phase-in of the Fair School Funding Plan is part of this year’s state budget debate.  The Ohio legislature must produce the next Fiscal Year 2024-Fiscal Year 2025 state budget by June 30.  The Ohio House passed its version of the state budget, House Bill 33, in late April and forwarded it to the Ohio Senate for further hearings. Tomorrow, May 31, the Senate Finance Committee will hear testimony on the school funding sections of the budget.  Two years ago, as part of the state budget, the legislature launched the first phase of a new school funding formula, with a second phase to be accomplished in the budget being developed this year, and the final phase-in to be completed in Fiscal Years 2026 and 2027.  Although the Legislature launched the phase-in of the plan two years ago, legislators did not establish the plan in a stand-alone bill. It’s existence, therefore, rests on legislators’ continued commitment to funding the full phase-in as part of the biennial FY 2024-FY 2025 state budget to be passed by June 30.

The Fair School Funding Plan was developed by an expert working group whose members spent three years calculating the real costs of reasonable class size for students from Kindergarten through twelfth grade and the state investment required for a full curriculum along with special programs for children with special needs, English language learners, and students living in concentrated poverty. The new plan is designed to make it possible for school districts lacking property wealth to fund their public schools adequately.  When the Ohio House passed its version of the new budget in April, the House fully funded the next step of the projected six-year phase-in of the Fair School Funding Plan and at the same time, the House updated the data on which the formula calculates each school district’s state revenue.

It is becoming clearer, however, that Senator Huffman and the Senate Finance Committee Chair Matt Dolan are balking about funding the new formula in perhaps two different ways. First, they may stop or slow down the phase-in. It is important to remember that if the legislature were to abandon the continued phase-in of the plan, our state would lack a working school funding formula.

Second, by questioning whether the new budget should update the school district cost data from FY 2018 to FY 2022 (the most recent data currently available), Senator Dolan has expressed skepticism about the required regular updating of the data on which the new formula is calculated. The Plain Dealer’s Editorial Board worries about Dolan’s reluctance to update the new formula to accommodate inflation in the costs school districts face: “State Sen. Matt Dolan, a Chagrin Falls Republican who chairs the budget-writing Senate Finance Committee has raised concerns about the House’s decision to change (the Fair School Funding Plan’s) base year from FY 2018 to FY 2022. Dolan recently argued to the Columbus Dispatch that using FY 2022 data would amount to a ‘huge increase’—potentially hundreds of millions of dollars… ‘Funding our schools is important… but we need to be doing it in a way that we can afford.’”

Ohio school finance expert, Dr. Howard Fleeter explains that Dolan’s reticence to implement the required update of the data in a complicated mathematical formula will undermine the entire plan: “For the school funding formula to have any integrity as an accurate reflection of the adequate levels of school funding required in Ohio it must be based on current and appropriate data… (I)t is just not defensible to claim that Ohio’s funding formula is adequate if the underpinnings of the formula are not the most current data available… Ohio’s funding formula can be thought of as having two main parts, with Part 1 being the formula amounts for the base cost and categoricals (adequacy) and Part 2 being the state/local share calculation which determines the share of funding for each district that should come from the state and the share which is expected to come from local resources (equity).”

Fleeter concludes: “It is important… to clarify that updating the property value and income data each year is the correct thing to do. The problem is that updating the data on one side of the formula (the state/local share side) while not updating the data on the other side of the formula (the funding adequacy side) leads to an imbalance in the formula… Again, the issue here is… that the two sides of the funding formula must move in parallel with one another.” (emphasis in the original).

In Public Education at a Crossroads: Funding, the State Budget, and All of Us,  a recent forum sponsored by the Ohio League of Women Voters, Jim Betts, who was part of the working group that designed the Fair School Funding Plan, explains that by failing to update the cost data from FY 2018 to FY 2022, the Ohio Senate would shift the tax burden of paying for public education from the state to local property taxpayers.  While in FY 2018 and FY 2019, the state assumed 50 percent of the cost of funding public schools, that percentage fell in FY 2022 to 42.2 percent, and in FY 2023 to 39.8 percent.  If the Ohio senate does not update the cost data, the state’s contribution will fall to 37.4 percent in 2024 and 35.5 percent in FY 2025.

Betts concludes: “The House version would basically sustain the phase-in, would sustain the values that are built into the Fair School Funding Plan, and… would sustain a reasonable relationship between the state and local share. That goes away if… the Senate does not concur in the change of the data year from 2018 to 2022… If that version coming out of the Senate does not include that data update… the plan would basically put a much larger burden percentage-wise on the (local) taxpayer… That is a huge transfer of responsibility.”

Ohio’s 1.6 million students need a thorough and efficient system of well funded public schools whether they live in rural areas, towns, small cities, suburbs or the state’s 8 large cities.  The system needs to be adequate and equitable.  The Ohio Senate should concur with the Ohio House provisions for phasing in the Fair School Funding Plan in HB 33, the next Ohio state budget.

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Will the Ohio Senate Fail Our Children by Refusing to Fund the Continued Phase-In of the Fair School Funding Plan?

The Ohio House Budget, passed in late April and sent on to the Ohio Senate, fully funds the ongoing phase-in of the Fair School Funding Plan, an adequate, equitable, and reliable way to fund public education for Ohio’s 1.6 million students enrolled in the state’s 610 public school districts. The full Ohio Legislature must pass the budget for Fiscal Years 2024 and 2025 by the end of June.

As the Ohio legislature develops the budget, fully funding the continued phase-in of the Fair School Funding Plan should be a top budget priority for all Ohioans. The Fair School Funding Plan was carefully developed by a working group whose members spent three years calculating the real costs of reasonable class size for students from Kindergarten through twelfth grade and the state investment required for a full curriculum along with special programs for children with special needs, English language learners, and students living in concentrated poverty. The new plan would also make it possible for school districts lacking property wealth to fund their public schools adequately. Two years ago, the legislature launched a six year phase-in of the Fair School Funding Plan. The first phase was accomplished in the current FY 22-23 state budget.

Although the Legislature launched the phase-in of the plan two years ago, legislators did not establish the plan in a stand-alone bill. It’s establishment, therefore, rests on legislators’ continued commitment to funding the full phase-in.  That is where there is potential trouble.  The Ohio House has presented a budget plan which funds the next phase of the new school funding formula, but earlier this month, the Plain Dealer‘s Laura Hancock described waffling by Senate President Matt Huffman: “He… said that he doesn’t buy into the idea that the Fair School Funding Plan has a six-year plan, even though the plan’s architects built it that way. He said too many school districts are sitting on significant cash reserves. ‘One of the issues with 600 school districts is we get the big 8s and the rurals, and the rurals who have money and the rurals who don’t have money… And then we have the suburban schools, who don’t allow open enrollment from the urban schools. So there’s a lot of different kinds of public schools and even schools within districts. It’s hard to make a generalization.'”  On the other hand, Hancock quotes Huffman as being perfectly willing to spend nobody knows how many hundreds of millions of dollars to fund universal vouchers for private schooling: “Senate President Matt Huffman, in whose chamber the two-year budget is currently being vetted, said… that the Senate is considering expanding to universal vouchers. He believes people walking with their feet… is strong accountability.”

In a wonderful new video produced by the Ohio League of Women Voters (LWV) last Thursday, Public Education at a Crossroads: Funding, the State Budget, and All of Us, we learn the facts which Senate President Matt Huffman seems determined to obfuscate and distort.  Last week’s video features policy authorities: Howard Fleeter, the economist who has been the expert on Ohio’s school funding since the early 1990s during the DeRolph case; John Patterson, one of the sponsors of the Fair School Funding Plan; Jim Betts, a member of the three-year working group that designed the plan; and Tanisha Pruitt, a policy fellow at Policy Matters Ohio.

In the video, Howard Fleeter explains: “A school funding formula has two purposes: to make sure school funding is adequate and to make sure school funding is equitable.” Fleeter wrote a report for then Governor George Voinovich in 1992: “Its title was Equity, Adequacy, and Reliability in School Finance.  And if I were to write a report right now, I would call it Equity, Adequacy, and Reliability in Ohio School Finance. The issues are the same now as they were thirty years ago.” Fleeter explains that one common problem across the states is that legislatures look at how much money they have to spend on all the functions of state government (and also consider tax cuts) and then just decide how to cut up the various pieces of the budget pie without any consideration of the real cost of public schooling. “The DeRolph decision made clear that is not acceptable.  In order to be adequate, the system needs to be based on an analysis of the cost of educating different types of students.” “K-12 education is different than other services. It’s different because it is specifically mentioned in the constitution.”

This month, Ohio senators are balking not only about funding the next step in the Fair School Funding Plan’s phase-in; they are also threatening not to fully update the cost data (to keep up with inflation) on which the Fair School Funding Plan is calculated. The Ohio House budget does phase in the next step of the plan and further updates the cost data for inflation, but the Senate seems not fully committed. Because the Fair School Funding Plan is calculated with an objective formula that adjusts for the actual base cost-per-pupil in every one of Ohio’s school districts, the formula must be updated in every two year budget to reflect the actual costs that change from year to year through inflation. Two years ago, the latest cost figures available were from 2018, but now it is time to update the formula with new cost figures recently released for Fiscal Year 2022. Apparently Senator Huffman believes that when inflation happens, schools just will have to make do by making classes bigger, or making counselors’ case loads larger, or eliminating music and art. In the video, Jim Betts explains simply that any working school finance formula based on the real costs of operating schools, “needs to be adjusted… because inflation will always further erode the values.”

What is Jim Betts’ biggest worry about Ohio this year?  If the Ohio Senate refuses to adjust the formula by updating the data on which it is calculated by using 2022 cost figures instead of old, 2018 cost numbers, or if the legislature fails fully to fund the next step of the three year phase-in, the Ohio Senate would be transferring responsibility for funding public schools to local school districts, whose citizens would be forced try to pass additional local property tax levies to maintain existing programming.  Increasing reliance on local school property taxes is inequitable because it places a heavier burden on the school districts that lack sufficient local property valuation.  The DeRolph decision itself declared overreliance on local property taxes unconstitutional, because districts with lots of property wealth can more easily fund their schools locally.

Like Jim Betts, the members of the Plain Dealer editorial board worry that the Ohio senators crafting the budget may fail to adjust the Fair School Funding Plan’s formula with updated 2022 cost figures: “State Sen. Matt Dolan, a Chagrin Falls Republican who chairs the budget-writing Senate Finance Committee has raised concerns about the House’s decision to change (the Fair School Funding Plan’s) base year from Fiscal Year 2018 to FY 2022. Dolan recently argued to the Columbus Dispatch that using FY 2022 data would amount to a ‘huge increase’—potentially hundreds of millions of dollars… ‘Funding our schools is important… but we need to be doing it in a way that we can afford.’… Senate President Matt Huffman, a Lima Republican, has also expressed reservations about fully funding (the plan) for the next two years.”

In the LWV video, Howard Fleeter warns citizens not to believe Senators Huffman and Dolan when they say there is insufficient money in the state coffers to equitably and adequately fund Ohio’s public schools: “Don’t let anybody convince you that fully funding the phase-in of the Fair School Funding Plan is too expensive for the state… This is an investment more than it is an expenditure… Our constitution requires it, but common sense requires it even more… The (Ohio) Senate has been exaggerating, inflating and bloviating about the cost of this model since it was first released.”

It is well worth taking the time to watch and carefully listen to Public Education at a Crossroads: Funding, the State Budget, and All of Us, an extremely accessible and genuinely interesting conversation by Ohio’s experts about what is at stake for Ohio’s public schools as the Ohio Senate develops its version of the next state budget.

Public Funding for Private Education is Not Useful to Students in Most Rural Areas and Small Towns

Last Saturday morning, members of the Northeast Ohio Friends of Public Education discussed a report by one of our members, Susie Kaeser, who has been researching how any one of the three school voucher expansions being considered by the Ohio legislature would inequitably redistribute school funding across the rural-urban divide.

Ohio funds private school vouchers from the state’s public school school foundation budget.  Kaeser has examined demographic data showing that any voucher expansion would siphon state dollars from all of the state’s public schools including the rural and small town schools on which families depend as they have for generations. At the same time the expansion of private school tuition vouchers would divert state revenues to private schools located primarily in the state’s urban counties. There are 88 counties in Ohio, but across 46 of those counties, school enrollment is so small that only a few can support one or two private schools in addition to their public schools.

As we talked last Saturday, we wondered why so many legislative representatives from rural areas support the expansion of school vouchers and seem so unaware that the families they represent would be unaffected by the expansion of school privatization, while at the same time, their public school districts would lose state dollars diverted to privatization. In this year, with a wave of proposed voucher legislation rushing across more than half of the state legislatures, it is worth considering Kaeser’s specific demographic research here in Ohio.  The model bills being distributed by the American Legislative Exchange Council and ALEC’s partners in the State Policy Network are sold to state legislators with a beguiling marketplace ideology that neglects to remind legislators of the demographic facts.

Combing the Ohio Department of Education’s website, Kaeser discovered: “There are dramatic differences by county in the number of students enrolled in Ohio’s public schools. Countywide enrollment ranges between as few as 1,690 students in Noble and Morgan counties, and close to 170,000 in Franklin County (metropolitan Columbus). Enrollment in the largest county is about 100 times that of the smallest… Forty-six of Ohio’s 88 counties—more than half of all counties in Ohio, have between 1,600 and 8,000 students, and 9 more have fewer than 10,000 students.”

Kaeser continues: “Like public school enrollment, private school numbers vary widely across the state. The likelihood of there being a private school increases with the size of public school enrollment…  Most of the public school population is concentrated in Ohio’s 8 largest urban counties, and so is the private school population. The 8 largest counties have 46% of the public school population and 71% of the private school students… Public education is the only consistently available education choice in Ohio’s 46 small counties, those with less than 8,000 public school students. There are 63 private schools scattered across these 46 counties. There are 11 counties without any private schools; 15 have one (private school); and 14 have two.”  Private schools across these 46 counties serve a total of only about 7,000 students. “Public funding for private education is not useful to students in most rural counties. Rural taxpayers underwrite private choice in the state—but not where they live.”

Despite that expanding vouchers should not be a legislative priority in Ohio, there are three different plans being considered today in the Ohio Legislature:

• In the House budget for FY 2024-2025, passed on April 26 and sent forward to the Senate for consideration before its required passage by June 30, eligibility for the income-based statewide EdChoice voucher program would be expanded to qualify all Ohio students whose family income is up to 450 percent of the federal poverty line, or $135,000 per year. It is a nearly universal plan which would qualify 80 percent of Ohio’s students for a private school tuition voucher out of the state budget line that pays for public schooling. Under the House budget voucher expansion, each K-12 voucher would grow from $5,500 to $6,165 and each high school voucher would grow from $7,500 to $8,407.
• The Ohio House of Representatives has been holding hearings on House Bill 11—a universal “Backpack” Education Savings Account school voucher plan (including for private schools, homeschooling and family micro-schools), which the Legislative Service Commission estimates would cost $1.3 billion (again from the state school foundation budget) in its first year of operation.
• The Ohio Senate, on the other hand, in a proposed Parent Educational Freedom Act (Senate Bill 11), would offer all students in grades K-12 a voucher—worth $5,500 for elementary school and middle schoolers and $7,500 for high school students—an investment which the Legislative Service Commission (LSC ) costs out at an additional $528 million in each year of the FY 2024-2025 state biennium. Senate Bill 11 would also increase the homeschooling income tax credit from $250 to $2,000 (which the LSC estimates would cost an additional $38 million in FY 2024 and $44 million in FY 2025). Again the school foundation budget would be the source of these funds.

Like Kaeser, we should all wonder why Ohio’s legislators are so intent on diverting state funding to private school vouchers, which according to her new report, would be largely irrelevant for students living in 46 of Ohio’s 88 counties—counties where there are few private school options.

It is ironic and disappointing that legislators seem to be prioritizing vouchers, when, in the FY 2024-2025 biennial budget, they have an opportunity to fully fund the desperately needed Fair School Funding Plan, which was only partially phased in in the current biennium. The Ohio Fair School Funding Plan is designed to to ensure that all Ohio school districts are adequately funded and that state funding is distributed equitably to serve the needs of Ohio’s students whether their school districts are located in cities, rural areas, small towns or suburbs.

Unlike a private school voucher expansion which would unfairly redistribute state dollars away from Ohio’s rural areas, the Fair School Funding Plan was designed by experts to serve the needs of every one of Ohio’s 1.6 million public school students. As Kaeser concludes: “Legislators representing Ohio’s rural counties can best serve their constituents by investing the state’s education resources in making sure that every student has access to a high quality public education, regardless of the capacity of their community to fund it.”

Why the Ohio Legislature Must Make PUBLIC School Funding It’s Top Priority This Year

In January of 1960, when I was in the seventh grade, I learned about the meaning of public education in the United States.  Just out of graduate school, my father had secured a job teaching history at a small teachers college in Havre, Montana. Mid-year, he was to replace a professor who had been killed in a hunting accident.  On January 20, a day when the temperature hovered at minus 35 degrees, my mother took me to the Havre Junior High School, and while she filled out the paperwork, I was sent right to class.

The public schools in that town of 10,000 people were were solid and strongly supported by the community. The Havre Daily News regularly published the high school honor roll and dutifully covered Havre Blue Pony sports; high school drama productions including Inherit the Wind,  A Midsummer Night’s Dream, The Crucible, and South Pacific; and the high school band’s trip to a competition in Moose Jaw, Saskatchewan.  Schooling definitely wasn’t perfect in Havre’s public schools, with too much tracking and not enough challenge in the core curriculum for many of the students.  The schools failed to reach out effectively to students at the nearby Rocky Boys Indian Reservation and in Havre, we didn’t learn anything about those students living only a few miles away.  While inclusion and welcome were improved in Havre’s schools after a 1972 state constitutional convention mandated American Indian Education for All, implementation of that program across the state has not yet been fully accomplished. Our challenge as a society is to keep on improving access, equity and academic excellence in the public schools that serve 50 million of our children and adolescents. In small towns like Havre and across our nation’s vast rural areas, the public schools are what families count on; there will never be many school choices.

What I learned in a very personal way that winter was that there was a place—well established by a state and a community—awaiting me on the cold morning when I showed up. I was well-served by our nation’s system of universally available, publicly accountable and publicly funded schools—an institution with the capacity to balance the needs of each particular student and family with the community’s obligation to create a system that, by law, protects the rights of all students. Across the states we continue to strive more fully to realize these principles, but the public schools are the only educational institution where fulfillment of these promises is possible.

I suppose my experience all those years ago is why I am so utterly dismayed that legislators in my state today, Ohio, seem dead set on privatizing the public schools.  In recent a Plain Dealer column, Policy Matters Ohio’s Piet van Lier captured the essence of what’s going on: “Ohioans know that honest, inclusive education is the foundation on which our state’s future will be built. But certain politicians are all too eager to copycat the most destructive ideas being pushed by ideologues nationally—especially in Florida… from tax cuts for the wealthy and school voucher programs, to education gag orders and attacks on the rights of young people in the LGBTQ+ community. Some Ohio policymakers have the right idea, pushing to implement the Fair School Funding Plan, which would keep our local public schools on a path toward constitutional funding.  But there’s little else happening in the Ohio Statehouse to give public schools supporters much hope.”

Full funding of the Fair School Funding Plan should be the Ohio Legislature’s top budgetary priority as it plans for the Fiscal Year 2024-2025 biennium.  Two years ago, as part of the FY 2022-2023 state budget, the Ohio Legislature launched a new school funding formula, designed to be phased in over six years—three biennial budgets—to fund the state’s public schools adequately and distribute state dollars equitably to ensure that students in poor as well as wealthy communities can thrive academically. The new formula’s stated purpose was to identify and pay for the per-pupil cost of essential services needed by our state’s typical student and to add categorical funding to support students with special needs.  Two years ago, however, the Legislature embedded the Fair School Funding Plan into the state budget without establishing the new school funding formula in a stand-alone law.  In June of 2021, the Legislature basically funded the first two years of the Fair School Funding Plan.  Today, as part of developing the new budget, the Legislature should take advantage of the state’s strong financial situation by fully funding the formula’s phase-in.

On Tuesday of this week, the Ohio House Finance Committee introduced its version of the biennial state budget for Fiscal Years 2024-2025.  Although public school supporters had hoped the legislature would fully complete the phase-in of the Fair School Funding Plan during this biennium, the House budget, expected to be passed by next week and sent forward to the Ohio Senate, at least covers the second step of the phase-in of the new formula. It also addresses some of the current problems lingering from the plan’s original phase-in.  The plan is currently being calculated on old student data from Fiscal Year 2018, and the budget introduced this week in the  House Finance Committee would calculate the statewide student average base cost per pupil using more current FY 2022 data.  Two years ago, the Legislature promised to investigate the added cost the state needs to provide to adequately support school districts serving concentrations of students living in poverty, but that research was neither funded nor accomplished. The new House budget calls, finally, for that research to be conducted. But the Legislature began the phase-in of Disadvantaged Pupil Impact Aid at a significantly slower rate than the rest of the plan was phased in.  That problem isn’t mentioned in the House’s proposed budget.

It is clear that while the state’s financial circumstances appear to be solid this year—partly due to remaining one-time American Rescue Plan Covid-relief dollars, Ohio legislators seem to have other priorities.  We’ll have to watch carefully to see whether legislators carry through on fully funding the phase-in of the Fair School Funding Plan.

First is the problem of tax cuts. The House had been moving forward with a proposed substitution (in House Bill 1) of a flat tax for the state’s graduated income tax, a convoluted and flawed proposal which, thankfully, the House seems to be casting aside.  However, the House budget released this week substitutes another very significant state income tax reduction.  At least this one features cutting taxes for low and middle income Ohioans, instead of cutting taxes for the wealthy like the previous flat tax proposal, but the House tax cut is projected to reduce overall state revenue by $1 billion and make it harder to fund the public schools.

And, to make it even harder to invest in the Fair School Funding Plan, legislators are holding hearings on several different and very expensive school voucher proposals:

The Ohio House of Representatives has been holding hearings on House Bill 11—a universal (including for private schools, homeschooling and family micro-schools) “Backpack” Education Savings Account school voucher plan, which the Legislative Service Commission estimates would cost $1.3 billion in its first year of operation.

The Ohio Senate, on the other hand, in a proposed Parent Educational Freedom Act (Senate Bill 11), would offer all students in grades K-12 a voucher—worth $5,500 for elementary school and middle schoolers and $7,500 for high school students—an investment which the Legislative Service Commission (LSC ) costs out at an additional $528 million in each year of the FY 2024-2025 state budget. Senate Bill 11 would also increase the homeschooling income tax credit from $250 to $2,000 (which the LSC estimates would cost an additional $38 million in FY 2024 and $44 million in FY 2025).

And in the House budget released this week, the House tops the school voucher plan the Governor proposed in his FY 2024-2025 state budget. While right now Ohio families living at 250 percent of the federal poverty line can qualify for EdChoice vouchers, the Governor had planned to expand EdChoice eligibility to include students whose family income is up to 400 percent of the federal poverty line, or $120,000 per year. The Legislative Service Commission said this might cost the state $172 million every year.  The new House budget would instead qualify all students in families with incomes up to 450 percent of the federal poverty line—incomes of $135,000 per year for a family of four—for EdChoice vouchers.

With Ohio’s gerrymandered, supermajority Republican legislature, citizens can be pretty sure one of these school voucher expansions will move forward.

The leader of the Ohio Coalition for Equity and Adequacy of School Funding, former assistant Superintendent of Public Instruction, and longtime warrior for justice for Ohio’s public school students, William Phillis commented last Friday on an article published in the Columbus Dispatch by Ohio Senator Sandra O’Brien, in favor of Senate Bill 11,  the school voucher bill she has sponsored.  Phillis dissects her logic and condemns her justification for the law she has proposed:

“The sponsor of SB11 supports the perception that parents and students deserve the choice of a private education at public expense. The gist of the sponsor’s thought process is that public schools are well-funded (‘The Ohio taxpayer has done a fantastic job in making sure that our schools are funded.’); that public schools will not lose funds as a consequence of SB11; that school privatization is a national movement; that two-thirds of property tax dollars go to public schools; and ‘Why can’t parents spend their tax dollars at the school they choose for their children?'”

Phillis continues: “Possibly the sponsor is not aware that the… Fair School Funding Plan has been only partially funded and that the system was (and still is) ruled unconstitutional 26 years ago (in DeRolf v. Ohio). Just maybe the sponsor is not aware that the voucher funds are taken from the same state budget line item that funds school districts.  The fact that two-thirds of local (property) tax money goes to school districts has no relevance to the voucher issue. Neither is the fact that voucher advocacy is nationwide relevant to the Ohio issue.”

Phillis concludes: “The notion that a person’s tax payment belongs to him/her after the tax payment is made is the most interesting, revolutionary idea. So the tax one pays does not belong to the government to use for the common good? It really belongs to the taxpayer for a ‘private benefit’ of the taxpayer’s choosing?”

I am grateful to Bill Phillis for insistently declaring the importance of protecting public education—our nation’s system of publicly funded, universally available, and publicly accountable schools. Public schools are the optimal institution for balancing the needs of each particular student and family with the community’s obligation to create a system that, by law, protects the rights of all students.

Advocates Who Want to Protect Ohio’s Public Schools This Year Must Pursue Three Priorities

On Tuesday in Columbus, Ohio, the powerful Ohio Senate Education Committee held its first meeting in the new session of the Ohio Legislature.  In upcoming months, as the Legislature develops the next biennial state budget to be enacted by June 30, 2023, parents, educators, and citizens who care about the common good must pressure the Legislature to support the needs of Ohio’s public schools. Securing the needs of Ohio’s students in public schools will be a heavy lift in a legislature dominated by a conservative Republican supermajority.

The public schools, which serve 1.7 million of our children, don’t seem to be what’s on the minds of Ohio’s legislative leaders right now. Tuesday’s Senate Education Committee agenda featured two primary topics: Senate Bill 1, recently reintroduced to eviscerate the State Board of Education, and Senate Bill 11, a vast expansion of the state’s EdChoice private school voucher program.

Those who support Ohio’s public schools must focus on three priorities: (1) advocating for the full phase-in of the Fair School Funding Plan which was embedded in the biennial budget in June of 2021 but never established in a stand-alone law; (2) opposing the vast expansion of EdChoice private school tuition vouchers; and (3) opposing the Legislature’s plan to politicize the Ohio State Board of Education by eviscerating its primary functions and moving them into a cabinet Department of Education and the Workforce under the political control of the governor.

Advocates Must Press for the Full Phase-in of the Cupp-Patterson Fair School Funding Plan in the FY 2024-2025 State Budget.

Two years ago, the Ohio Legislature began implementing a new “Fair School Funding Plan.” The new formula had been carefully designed over three years to fund the state’s public schools adequately and to distribute state funding equitably to ensure that students in poor as well as wealthy communities can thrive academically. Ohio’s school funding had been deemed unconstitutional over 25 years ago in DeRolph v. Ohio, when the school funding formula was deemed overly reliant on local property taxes.  The new Fair School Funding Plan, launched two years ago and based on funding the per-pupil cost of essential services needed by our state’s typical student and adjusted to add categorical funds to support services for students with special needs, was designed to be phased in over six years—three three biennial budgets.

However, the Legislature failed to establish the Fair School Funding Plan in a stand-alone law. It would be unfair, Senate President Matt Huffman said, to tie the hands of future legislatures because nobody can predict the economic constraints on future revenues. In June of 2021, the Legislature did basically fund the first two years of the Fair Funding Plan. Now in 2023, the Legislature needs to add funding for the second step. Right now, Ohio has the two year beginning of a Fair School Funding Plan, but no promise that the legislature will continue funding the full phase-in.

The Legislature also needs to correct one flaw.  Lawmakers neglected to conduct a promised cost study to evaluate the needs of school districts serving many children in poverty, and they began the phase-in of Disadvantaged Pupil Impact Aid at a much slower rate than their phase-in of the rest of the plan. It is the responsibility of the current Legislature to correct those serious problems.

Continued phase-in of the Fair School Funding plan is not a sure thing. The Ohio Capital Journal’s Susan Tebben reports that Governor DeWine highlighted the Fair School Funding Plan among his budget priorities last week: “DeWine mentioned the plan in his speech, saying it should be funded, but Democrats are unsure what Republicans’ plans are for the third year of the six-year phase-in designed in the plan. The plan has only been funded for two years so far, because (Senate President, Matt) Huffman refused to assign funding priorities to future general assemblies.”

After the Governor presented his budget priorities, the Columbus Dispatch‘s Haley BeMiller and Anna Staver added: “Huffman… expressed skepticism about DeWine’s plan to fund schools. ‘The same concerns I mentioned when we passed the budget two years ago are still in place,’ he said.”

Advocates Must Vociferously Oppose Senate Bill 11, Yet Another Expensive Expansion of EdChoice Vouchers.

While Senate President Matt Huffman seems anxious about the expense of fairly funding the public schools, Huffman doesn’t seem a bit worried about the fiscal viability of a huge expansion of the EdChoice voucher program, now introduced as Senate Bill 11.  The Plain Dealer‘s Laura Hancock explains that right now under the current EdChioce program, “Families are eligible for EdChoice scholarships by either living in the boundaries of a low-performing school or by household income. Currently a family of four can qualify for state money if the household income is at or below $69,375, or 250% of the Federal Poverty Guidelines…” Under the proposed SB 11, “The limit would increase to 400% of the Federal Poverty Guidelines, which would be $111,000 for a family of four….”

Most people worry that a huge expansion of the number of students taking EdChoice vouchers out of the school foundation budget will radically reduce funding for the state’s public schools. Instead Senate President Huffman argues that the expansion of vouchers will save money for the public schools. Hancock quotes Huffman enthusing that: “(I)ncreasing vouchers up to 400% of the federal poverty line covers most of the state’s residents… ‘Although it’s not a universal voucher, it practically speaking, is in many regards.'” Using specious math that fails to reflect the complex school funding formula, which distributes state funding to compensate for disparities in taxable property and aggregate family income from school district to school district, Huffman went so far as to claim: “As vouchers are expanded there’s more money available for public schools…”  Certainly Huffman is also ignoring that during the history of the EdChoice program, the majority of EdChoice vouchers have always been taken by families whose children already attend private schools. Assuming that trend would continue and more students already in private schools opt to take a voucher as a new entitlement, experts warn that Huffman’s defense of vouchers as a way to save money for public schools is an absurd argument.

Advocates Must Oppose Senate Bill 1 to Eviscerate the State Board of Education and Move Most of Its Responsibilities to a Department of Education and the Workforce under the Control of Governor.

Efforts to politicize the Ohio State Board of Education culminated in December when the Legislature came close to passing Senate Bill 178. (See here.) The effort collapsed in the final hours of the legislative session, but the bill was reintroduced immediately in January as Senate Bill 1.  The Ohio Capital Journal’s Susan Tebben describes the discussion of SB 1 at this week’s first meeting of the new session’s, Senate Education Committee: “Workforce development components of a bill to overhaul education in Ohio by taking power from the state school board and putting it under the governor’s office were applauded by supporters in an Ohio Senate committee Tuesday. Supporters ranged from businesses to career centers to the Ohio Chamber of Commerce, all of whom spoke out at the Senate Education Committee about the progress they believe the bill would make in developing workforce talent in the state, rather than bringing in employees from other states and countries.”

Tebben quotes Senator Bill Reineke describing bill he has introduced: “The bill’s focus is still the same: to improve academic and workforce skills to drive better accountability and outcomes for our kids’ education and career readiness.”  Tebben also quotes Reineke explaining that the bill also will, “guarantee homeschooling families the ability to home-educate their child by exempting a child from compulsory school attendance when that child is receiving instruction in core subject areas from their parents.”  She points to the irony that Reineke’s defense of homeschooling in Ohio “comes amid a new investigation by the Department of Education into what’s been reported as a pro-Nazi homeschooling network run by a couple from Upper Sandusky.”

As I listened to a December hearings on Senate Bill 1’s predecessor, SB 178 intended to reduce the power of Ohio’s state board of education, I heard the members of the committee frame their arguments about test-based accountability and expanding the workforce—abstract concepts that have little to do with education practice—which is the purview of the State Board. I listened to politicians discuss standardized test scores—numbers, percentages, and supposed trends measured by the numbers. The conversation did not once connect to what happens in a public elementary school classroom or in a comprehensive public high school. I listened to an ideological debate with little connection to the role of the State Board of Education, which is to shape education practice.

This year as Ohio’s law makers attempt once again to politicize the State Board of Education, advocates should demand that legislators attend to their own responsibility for education policy. The first step would be fully phasing in the Cupp-Patterson Fair School Funding Plan as the Legislature drafts the FY 2024-2025 state budget, a phase-in that must include promised dollars for Disadvantaged Pupil Impact Aid.  A second step would be avoiding the catastrophic cost of a massive expansion of private school tuition vouchers. Finally, the Legislature should allow the State Board of Education, with several enthusiastic and well qualified new members elected in November, to get on with its work.

School Finance Experts Raise Concerns about Legislature’s Phase-In of Ohio’s Fair School Funding Plan

Howard Fleeter and R. Gregory Browning recently conducted a new, preliminary study of the funding of Ohio’s Disadvantaged Pupil Impact Aid (DPIA) under the state’s Fair School Funding Plan. The new plan was passed two years ago as part of the FY 2022-2023 state budget to be phased in over six years—three biennial budget cycles. Although Fleeter and Browning’s new report describes what the the state calls a Fair School Funding Plan, they show why the fairness of the plan has already become corrupted.  Sadly the plan’s implementation is coming to epitomize the old, old joke about school finance: “School funding is like a Russian novel: it’s long, and it’s boring, and in the end, everybody gets killed.”

In the case of Ohio, according to Fleeter and Browning’s December 2022 report, the school districts that get hurt the most are the ones serving a lot of the state’s poorest children. For thirty years, economist Howard Fleeter has been Ohio’s school finance guru—the person who understands better than anyone else the arcane complexities of the state’s system for funding its 610 public school districts.  Last Thursday, the Ohio Capital Journal’s Susan Tebben provided a copy for the general public of Fleeter and Browning’s recent report, which she describes as “an effort to show the state legislature some of the needs of the state education system.”

Fleeter and Browning explain their purpose in the report’s first sentence: “to help Ohio educators and public policymakers gain a deeper understanding of the specific supplemental services being provided to Ohio public primary and secondary school students who come from economically disadvantaged circumstances. The report also includes a preliminary analysis of the costs associated with providing these services.”  In fact, the new report focuses on the funding for the services, not the services themselves.

How much more funding from federal, state, and local sources does a school district need if a large number of poor students are enrolled in its public schools? Fleeter and Browning accept findings from three 2004 and 2007 economic studies which “demonstrate that a 30% multiplier for districts with high concentrations of students in poverty is on the low end of the marginal cost shown by educational research.” In other words, a district serving a lot of poor children needs at least 30 percent more per pupil funds to provide the services those children need at school. Necessary services include: “district-provided preschool programming and primary grade reading intervention… supplemental supports such as after-school programming, summer school and high school credit recovery;… and health and wellness supports, including school counselors and nurses, school-based health clinics and in-house behavioral health services.”

Fleeter and Browning examine the needs of three representative Ohio school districts—one urban, one rural, and another suburban. They conclude that, “the districts, in large part, provided the same array of supplemental services to their respective populations of economically disadvantaged students… Ohio’s Disadvantaged Pupil Impact Aid (DPIA) program and the federal Title I program remain the pillars of funding for supplemental services for economically disadvantaged students. These sources have been in place for many years and are the only funding sources that are specifically and exclusively intended to finance these services on an ongoing basis.”

However, Fleeter and Browning report that the three school districts have also been using a significant amount of federal Elementary and Secondary School Emergency Relief (ESSER) funds to support services for children living in poverty.  ESSER funds were awarded by the federal government to mitigate the problems from the COVID-19 pandemic.  But there is a problem: ESSER funds were a one-time grant; they are not an ongoing funding source. “Clearly, for each district, DPIA and/or Title I funding would have to be dramatically increased to replace one-time ESSER federal stimulus related funding that is currently being used to help pay for roughly 30% of supplemental service in each of the three districts... And in each case (school) leaders… believe that the identified low-inome students’ needs were largely, if not entirely in existence prior to the 2020 beginning of the COVID-19 pandemic and that they are needs that will be continuing past the pandemic and into the foreseeable future.” (emphasis in the original)

In the second paragraph of their report, Fleeter and Browning provide what they call the context for their concerns as we enter 2023, when the governor and the legislature are required to come up with a new FY 2024-2025 biennial budget. Early in the report we get the following hint about why this is all going to be like the long, sad Russian novel from the old joke:

“Ohio’s current school funding policies are rooted in the Ohio Fair School Funding Plan, which is being phased in over a six-year period beginning in FY 22. The plan is a new, inputs-based approach to funding primary and secondary education. It includes a new methodology for providing supplemental funding for the additional costs of providing needed educational services to economically disadvantaged students. This funding comes through the Disadvantaged Pupil Impact Aid (DPIA) component of the state’s school funding formula. Importantly, the phase-in of the new funding formula does not treat all components of the formula uniformly, as DPIA is phased in at a slower rate than the other funding components, nor does it provide a clearly articulated, evidence-based approach to funding DPIA. Lastly, there is no legal requirement that the new state funding formula be phased in fully in future years.”

Later in the report Fleeter and Browning detail some of the serious problems with the legislature’s calculation of the amount of Disadvantaged Pupil Impact Aid and with the program’s implementation:

• The state was supposed to provide an in-depth, cost-based study of the services needed to help very poor children thrive at school. But the state has neither funded such a study nor conducted it.
• The Fair School Funding Plan is supposed to be cost-based, but the state came up with phasing in an additional $422 per pupil for Disadvantaged Pupil Impact Aid on the cheap—without considering what school districts actually must spend: “(T)he mathematics behind the $422 per pupil figure are based on a 30% increase over the prior $6,020 per pupil base cost amount for non-disadvantaged students.  Under Ohio’s new state aid formula, the state average base cost—which is intended to reflect the cost of educating the ‘typical student in the typical school district’ is $7,349.  30% of this figure is $2,205, a nearly $400 increase over the $1,806 per pupil from which the $422 per pupil base DPIA figure is derived.” (emphasis in the original)
• Under the Fair School Funding Plan, the state has promised to support school districts serving poor children with added Disadvantaged Pupil Impact Aid, but is phasing in increases for DPIA at a slower rate than the phase-in of the rest of the plan. “There was zero increase in DPIA funding in FY 22 and only a 14% phase-in in FY 23.  All other components of the formula were phased in at a 16.67% rate in FY 22 and a 33.33% rate in FY 23.” Doesn’t it make sense to phase in DPIA at the same rate as the phase-in of the rest of the plan?
• The overall amount of funds allocated over the years to Disadvantaged Pupil Impact Aid has lagged at the same time the number of poor students who need the services has grown considerably: “(F)rom 2001 through 2021 total state aid for economically disadvantaged students has increased by 23.3%… while the number of economically disadvantaged students has increased by 57.5%….”

Finally, Fleeter and Browning name a serious threat to the future of the entire Fair School Funding Plan. The legislature funded the phase-in of the Fair School Funding Plan only for the first two years of the scheduled six year phase-in. The Plan was passed as part of the last biennial budget; it has never been established by stand-alone legislation. Two years ago, legislators left themselves the option of abandoning the funding of the plan after the end of the FY 2022-2023 biennium. In other words, their commitment to the plan may be winding down to its conclusion now before the new budget cycle begins on July 1, 2023.

It will be urgently important for advocates to demand that the Fair School Funding Plan survives in the FY 2024-FY2025 state budget, and that the full phase-in of this year’s promise—2/3 of the six year phase-in of the full plan—be part of the new biennial budget.  Additionally there must be a correction to ensure the full and timely phase-in of funding for Disadvantaged Pupil Impact Aid.

What the New Ohio Budget and School Funding Plan Will Mean for Public Schools

The FY 2022-2023 Ohio budget is different than most biennial state budgets because folded into it is a new public school funding formula, developed over more than three years and adopted previously by the Ohio House but never enacted by the Ohio Senate.  For those of you who worry about how public schools will fare under the new Ohio budget, the expert to consult is Howard Fleeter. In this post, I’ll summarize Fleeter’s analysis: FY22-23 State Budget Recap: Ohio’s New School Funding Formula, Voucher Changes and (yes, another round of) Income Tax Reductions.

Howard Fleeter is Ohio’s education funding expert. He has served Ohio’s education advocacy community through the Ohio Education Policy Institute (OEPI), since its inception in 1997. Fleeter regularly provides analysis for the Hannah News Service in a newsletter known as On the Money. In Cleveland, On the Money is available for library card holders in the research databases at the Cleveland Public Library, but the publication is not even available in Clevenet member branch libraries. Sadly On the Money is paywalled, which means you’ll have to trust me to summarize Fleeter’s conclusions.

Warning: In Fleeter’s new piece you cannot learn the answer to your primary question: How will my own school district fare during the upcoming biennium and beyond? And you won’t find the answer to your other urgent question: How long can my district put off going to the ballot to try pass yet another local levy?  On the other hand, Fleeter explains clearly and lucidly how the new budget and school funding plan will work.

Fleeter identifies the two essential components of Ohio’s school funding formula as being adequate school funding and the equitable distribution of the state’s contribution to the formula.

How the New Budget Addresses the Need for Adequate School Funding

The first problem the new formula must address is the old formula’s incapacity to measure how much money Ohio’s 610 school districts need: “Ohio’s most recent school funding formula, in place from FY14-FY19, did not employ any methodology for determining the base cost amount.”  The base cost is the formula’s calculation of the amount of combined state and local funding needed  to educate each of our state’s roughly 1.7 million children and adolescents. Fleeter continues: “Instead, the legislature simply set the per pupil amounts based on how much money they chose to allocate to K-12 education, an approach that the Supreme Court rejected over and over in the DeRolph case. In FY19 this amount was set at $6,200 per pupil…. The House funding plan (whose formula for base cost was adopted in the final budget) utilized an inputs-based approach to adequacy which resulted in an average base cost amount of roughly $7,200 per pupil, nearly 20% higher than the FY 19 figure…”  Fleeter credits Ohio’s new 2021 formula with the successful “development of an inputs-based methodology for determining the per-pupil base cost” for the first time since FY11.

What about other state investments beyond base cost? Unlike the Ohio Senate, the Ohio House in its proposed budget actually used up-to-date cost figures to determine how much school districts need for added categorical funding for students with disabilities, disadvantaged students, career-tech students, English language learners and gifted students. Sadly, although the House used accurate data, Fleeter reports that the House version of the budget called for $0 increase in disadvantage aid in FY 22 and only 1/7th of the scheduled increase in FY23.”  And, “An economically disadvantaged student cost study included in the House version of the budget was removed in the final version….”  The cost study, eliminated in negotiations with the Senate, was considered essential for identifying all the ways school districts should be providing additional support for students in communities where poverty is concentrated.

One positive: The old formula “included a ‘gain cap’ provision which limited annual increases in state funding to a pre-determined maximum percentage,” but in the new budget, “The much-despised gain cap has finally been eliminated.”  The gain cap problem affected growing school districts, which deserve additional per-pupil state dollars when more and more students move into the community. This problem in the old formula had frozen state funding under a gain cap for 163 of the state’s 610 districts.  The final budget does protect a transitional hold-harmless guarantee for districts whose enrollment is falling.

Another positive:  In the new budget the state “directly funds” vouchers and charter schools out of the state budget. Every time students leave for charter schools or take vouchers to a private school, the school district will no longer see a per-pupil charter school fee and the cost of each private school voucher extracted right out of the local school district budget. Fleeter writes: “This change has been 20 years overdue and brings Ohio in line with how most other states fund charter schools and voucher programs.”

One potential problem. The new budget folds an important budget line from the FY21-FY22 budget, Governor Mike DeWine’s Student Wellness and Success Program, into the current budget’s Disadvantaged Pupil Impact Aid without additional funding. This program is “intended to provide resources to address nonacademic barriers to student success, including mental health services, ‘wraparound services’ such as dental, vision, and medical care, family engagement and support services, and after school programs and mentoring.” Fleeter explains that the change “raises questions as to whether this funding stream will ultimately be spent on new initiatives to help reduce non-academic barriers to student success (as envisioned by Governor DeWine) or will simply be absorbed into the spending that districts are already incurring.”

How the New Budget Addresses the Need for More Equitably Distributed School Funding

The FY22-FY23 budget introduces a new mechanism for calculating each school district’s capacity to raise the local portion of school funding: “The state and local share mechanism is by far the single most important driver of equity in Ohio’s school funding formula. Property wealth has traditionally been the basis for the state/local share calculation because it is a reflection of school districts’ varying local tax revenue capacity. However, it is essential that the income level of school district residents also be included because this is a reflection of the ‘ability-to-pay’ of district residents. Ability-to-pay is important in Ohio because the heavy reliance on school levies as a result of HB 920 (the state’s local property tax freeze law) means that districts with lower income residents are less able to tap into whatever tax capacity they have by approving local levies.”

The new state budget employs “an income factor which adjusts the local share downward (and the state share upward) in school districts with income levels below the statewide median income and does the reverse in districts with income levels above the statewide median income. The most current data available is used to make this calculation.” Fortunately the final state budget incorporates the House version of the new local share calculation. The Senate budget “did not update the property value and income data, continuing to use 2014, 2015, and 2016 property value data and 2013, 2014, and 2015 income data.  Had the Senate’s funding formula been implemented in FY22 and FY23, the underlying data would have been 10 years old when it was updated in FY24 and FY25, which would have likely caused serious funding disruptions for many school districts.”

One Huge Problem with the New School Funding Formula

The final FY22-FY23 state budget school funding plan was a compromise between the House version built around the Cupp-Patterson Fair School Funding Plan and a new and much cheaper Senate proposal.  Although many of the mechanisms of the House Fair School Funding Plan were finally incorporated into the budget, the plan’s full six-year phase-in didn’t make it.

Fleeter writes: “The most significant concern with regard to Ohio’s new school funding formula is that HB110 (the final budget) specifies that the funding changes described above are only funded for the FY22 and FY23 school years. The funding formula developed by the Cupp-Patterson workgroup… called for a 6-year phase-in period. With the exception of Disadvantaged Pupil Impact Aid… increases in all funding components are correspondingly phased in at a rate of 16.7% in FY22 and 33.3% in FY23.  However, under HB 110, there is no language which outlines further funding phase-ins in FY24 and beyond.”

The Legislature’s added failure to phase in the 100% increase in Disadvantaged Pupil Impact Aid in FY22, as the House had proposed, and its failure to fund the House’s proposed cost study of the needs of economically disadvantaged students will only exacerbate the threat that the new formula once again will fall far behind what students need. There is good reason to fear that despite the best intentions of the legislators and experts who developed the Fair School Funding Plan over more than three years, this budget, will fail to address the needs of the state’s poorest children and will, as time passes, perpetuate long-running inequity.

One more thing… All the Ways the Legislature Expanded EdChoice Vouchers

The leadership in the Ohio Senate is devoted to expanding school privatization, and EdChoice vouchers are one place where the Ohio Senate left a big mark on the new state budget.  In his report last week, Fleeter simply lists all the ways the Legislature used the new FY22-FY23 budget to expand the state’s investment in one of its largest school voucher programs—EdChoice. The size of each K-8 voucher will grow from $4,650 to $5,500 and for each high school voucher from $6,000 to $7,500.  The legislature altogether eliminated “the cap on the number of EdChoice vouchers… which had previously been set at 60,000.” EdChoice vouchers are for children in the attendance area of a school on an eligibility list based on academic performance, but in the new budget all siblings of students who currently have a voucher are available wherever they live.  Students will also be eligible for EdChoice if they live in the attendance area of a public school that ranks in the lowest 20 percent on the State School Report Card Performance Index.  While there used to be a 75 day window for submitting an application for an EdChoice voucher, there is now “a rolling window with no closing date.”

And finally and most alarming, the new budget has begun “phasing out the requirement that students must have attended a public school in the year prior to qualifying for an EdChoice voucher. “This criteria had already applied to high school students (including incoming 9th graders) and will now be extended over a 4 year period to include K-8th grade students. By the FY26 school year no student would be required to have attended a public school in the year prior in order to be eligible to receive an EdChoice voucher.”

With the Legislature’s having reduced myriad limitations on eligibility for EdChoice vouchers, eliminating the cap, and making the application process open ended, one wonders how the overall budget for this program can possibly be anticipated or controlled.

That’s why, the Columbus Dispatch’s Grace Deng reports: “A coalition of 75 Ohio public school districts planning to sue the state over the EdChoice school voucher program said Monday the newly enacted state budget was an ‘assault’ on public schools.”

New Ohio Budget Will Demonstrate What Our State’s Leaders Value

I have never observed such a sense of urgency among educators and parents as we wait to see the compromises that will come out of Ohio’s House-Senate budget conference committee as soon as this afternoon. The Ohio Legislature must pass a budget and send it to Governor Mike DeWine for his signature by Thursday, the beginning of the FY 2022-2023 biennium.

One reason anxiety is running high is because the Ohio Senate has put off acting on a House-passed, brand new, school finance formula that experts say would comply with the demands of the Ohio Constitution for the first time since the Ohio Supreme Court found our state’s school funding unconstitutional 24 years ago. The Ohio Senate allowed legislation for the new school funding formula to die on December 31 at the end of the session by refusing to consider or vote on the bill after the House passed it earlier in the month.

Senate leaders argued they needed more time to study the plan, which the House reintroduced as Issue 1 last winter. When the Senate again failed to act, the House inserted the Fair School Funding Plan into its version of the next state budget, but the Senate didn’t respond until early June, when Senate leaders inserted their own substitute school funding plan—without significant discussion—into the Senate’s version of the state budget.

The House Fair School Funding Plan was developed by legislators, educators, and school finance experts over three years, while the Senate’s alternative merely appeared. The state’s seasoned school funding expert, who has studied and reported on our school funding system since the early 1990s, Howard Fleeter has explained not only that Senators based their new formula on outdated property valuation and median income data, a problem guaranteeing that the Senate’s plan won’t keep up with inflation, but also that the Senators failed to correct a mistaken calculation in the old formula that mismeasures each school district’s capacity to generate property tax revenue.

Why does all this arcane stuff seem frankly frightening to parents and teachers and school superintendents? Here are two experts dissecting the ongoing deterioration of Ohio’s method of funding public education, which left all of the state’s 610 school districts with state funding frozen at the FY 2019 level throughout the past two school years, and which previously had left over 80 percent of the state’s school districts on hold-harmless guaranteed funding or with state funding capped.

1. In April, outlining Ohio’s urgent need for the Fair School Funding Plan, Policy Matters Ohio’s state fiscal expert Wendy Patton explained: “Even as policymakers have expected public schools to do more, they have cut state aid to public schools over time, by allowing it to be eroded by inflation and diversion of funds to charter schools… and vouchers… As a result, public schools have increasingly relied on local resources, which causes unequal funding…. This is because our state’s school funding system relies heavily on property taxes, which advantages wealthier districts… As corporations eliminated jobs with living wages in Ohio, racial discrimination in employment and government-sanctioned segregation forced Black, Indigenous and other people of color into neighborhoods of concentrated poverty…. Schools in these communities need additional resources, but the declining local tax base cannot generate what’s needed. Many rural and small-town districts have faced economic challenges that make it hard for them to provide local funding.”  Overreliance on local property taxes was specifically found unconstitutional in the Ohio Supreme Court’s decision in DeRolph.
2. In May 6, 2021 testimony to the Senate Education Committee, Howard Fleeter described how the framers of the House’s Fair School Funding Plan designed the plan to address what has been alarming and  long-standing inequity in Ohio school finance: “Funding for economically disadvantaged students in particular has lagged well behind the growth in the number of such students over the past 20 years (funding has increased 22% while the number of (these) students has increased 61% since FY01)… Studies in other states have indicated that the additional costs of educating low-income students are typically 30% or more… Targeted Assistance and Capacity Aid should be retained as is the case in the HB110 funding formula (the Fair School Funding Plan).  These two formula components supplement formula funding by providing additional funds to low wealth districts that lack the tax base to pursue local educational initiatives in the same manner that wealthier districts can through local levies.”

Thankfully, both chambers of the legislature say they will agree to eliminate the state’s punitive and disequalizing school district deduction method for funding vouchers and charter schools—a method which deducts a state-set fee for each voucher or charter school tuition right out of the local budget despite that the school district’s state per-pupil foundation assistance is in many cases less than the cost of the voucher or charter school tuition. But despite this important reform, the Ohio Senate’s school funding plan exacerbates several other problems for public schools on top of the primary problem of our dated, inequitable and inadequate school funding formula. The Senate’s budget hurts public schools by:

• expanding  the size of each taxpayer funded, private school voucher from $4,650 to $5,500 for K-8 students and from $6,000 to $7,500 for high school students;
• adding a neo-voucher tuition tax credit program for families with income below $300 percent of the federal poverty line;
• creating taxpayer funded education savings accounts for home schooling;
• permitting widespread scattering of charter schools across all the school districts in the state, while in the past their location has been limited to so-called “challenged” school districts; and
• requiring that school districts sell or lease a school building to a charter school if the public school building was used in the previous school year for academic instruction for students at less than 60 percent of building capacity.

All this is in addition to the Ohio Senate’s proposed 5 percent cut in income taxes. Policy Matters’ Wendy Patton presented testimony demonstrating that only the wealthy will benefit from what the Senate is proposing: “Nearly half of the tax reduction would go to those in the top 5%, who are paid more than $221,000 a year. The top 1% percent, who have income of at least $526,000, would average a cut of $1,712 and receive a quarter of the tax reductions. The tax reductions in the Senate bill come on top of huge tax cuts the richest Ohioans have received over the past 16 years. While lower-and middle-income Ohioans on average saw little change or paid more in state and local taxes, the top 1% received more than $40,000 a year in tax cuts.”

Despite Patton’s warning, Gongwer reports that Senate President Matt Huffman explained last week that new higher revenue projections for the upcoming biennium in addition to American Rescue Plan funds might push him to increase tax cuts above the 5 percent already proposed in the Senate’s early June budget. Huffman has declared that higher revenue must be spent on one-time expenses this year instead of long-term investments in education or other programs.  However, he has failed to acknowledge that the tax cuts he is proposing—based on this year’s revenue—would not be rescinded at the end of this year. These tax cuts would be permanent unless the legislature subsequently raised taxes.

Alarm about House-Senate budget negotiations is not limited to public school supporters.  In a letter last week to legislators and Ohio Governor Mike DeWine, 97 state and local organizations identified problems in the Ohio Senate’s version of the budget: “It removes the plan to fairly and equitably fund our K-12 schools, dismantles the state’s foundation for ensuring high-quality child care, and removes critical funding to expand broadband access to our neighbors across the state. Another change will lead to fewer affordable housing options for low-income seniors, people with disabilities and parents trying to provide a better life for their children… All of these changes will be damaging to the long-term health and well-being of children, adults and families… particularly Ohioans with low wages… State lawmakers have cut income taxes for the wealthiest Ohioans for 16 years and Ohio continues to fall behind the nation on jobs, wages, and overall quality of life.”

The Plain Dealer‘s editors castigate the lack of moral principle in the Ohio Senate’s proposed budget: “The Senate says it’s just being frugal but the numbers belie that. Its proposal would add to inequities in school funding while perpetuating divisions over something that should unite Ohioans of all political stripes—the need to invest in our children.”

This blog has examined Ohio’s Fair School Funding Plan here.

EXTRA: Big 8 Ohio School Districts Protest Senate Plan for School Funding

The Ohio Legislature is considering a new school funding formula as part of the state budget which must be signed into law by July 1.  In this morning’s Plain Dealer, Laura Hancock reports* that the Ohio 8, the state’s largest urban school districts, held a news conference yesterday to protest several provisions of the Ohio Senate’s substitution of an inferior school funding plan for the Ohio House’s carefully developed and vetted Fair School Funding Plan.

Hancock reports that the state’s eight largest urban school districts announced: “The 25 wealthiest Ohio public school districts would receive the largest percentage increase in funding under the Senate’s version of education funding reform in the two-year state operating budget.  Cleveland Metropolitan School District CEO Eric Gordon said, ‘The 25 least wealthy districts in Ohio, including ours, received the smallest percentage of increase…  From an equity and fairness perspective, we would still advocate for a fair funding formula.'”

The Ohio 8 also point out an outrageous expansion of school privatization inserted quietly into the version of the budget now being considered by a House-Senate conference committee:

“The Ohio 8 group also disagrees with a budget provision currently being considered by the House-Senate conference committee that requires districts to sell or lease their buildings to charter, STEM or college-preparatory boarding schools in the district’s boundaries if the facility has been used for district academic instruction but less than 60% of the building is used for that purpose in the preceding school year.  That provision would go into effect July 1.”

Cleveland CEO Eric Gordon protests: “This is essentially evicting our schoolchildren out of our own buildings in order to give it to somebody else for other schoolchildren… They’re forcing us to move more children around our communities and there’s no similar provision that a charter school would have to use the whole space in the building.”

Hancock explains further: “Reasons that buildings are sometimes not at 100% capacity include them being used for wraparound services, for specialized programming, early learning, and after-school programming, Gordon said.”

It is appalling that the House-Senate budget conference committee is discussing a middle-of-the-night amendment to the budget that has never been considered at all in open hearings.  One wonders whether one of the large charter management organizations wrote the amendment and pulled strings to get it inserted into the state budget, or whether it was the Thomas Fordham Institute, which advocates for the expansion of charter schools and which, in Ohio, serves as a charter school authorizer.

The Ohio Legislature’s budget conference committee should insert the Ohio House’s thorough, equitable, stable Fair School Funding Plan back into the state budget. The plan was developed over three years by legislators, public school educators, and policy experts. The Ohio Constitution does not envision the investment of state budget dollars into a marketplace where individual parent consumers seek the perfect educational choice for each individual student.  Instead the state constitution defines public schools as an essential part of the social contract—the embodiment of our mutual responsibility to each other as fellow citizens and to Ohio’s children.  The constitution mandates a thorough and efficient system of common schools.

*The link is an exact copy of the Plain Dealer‘s paywalled article.

Ohio Activists Speak Out to Protest Injustices in Ohio Senate’s Substitute School Funding Plan

Last week, educators and policy experts spoke out clearly and profoundly against the Ohio Senate Finance Committee’s insertion into the next state budget of its own deficient and flawed school funding plan as a substitute for the Fair School Funding Plan that was part of the House Budget.

The Fair School Funding Plan—developed over three and a half years by experts, passed by a huge margin in the Ohio House and inserted into the House Budget—was designed to remedy a school funding formula that has ceased to work for any of the state’s 610 school districts during the current biennium.  Angry supporters of adequate and equitably distributed public school funding spoke last week to oppose the new Senate proposal which fails to remedy problems with public school funding and also expands school privatization.

Policy Matters Ohio’s Wendy Patton provided Senate Finance Committee testimony last week to oppose the Senate Finance Committee’s proposed 5 percent income tax cut: “This money will not significantly benefit most Ohioans and the cut will drain resources needed for good schools, better child welfare services and other public services that benefit all Ohioans…  Nearly half of the tax reduction would go to those in the top 5%, who are paid more than $221,000 a year. The top 1% percent, who have income of at least $526,000, would average a cut of $1,712 and receive a quarter of the tax reductions. The tax reductions in the Senate bill come on top of huge tax cuts the richest Ohioans have received over the past 16 years.  While lower-and middle-income Ohioans on average saw little change or paid more in state and local taxes, the top 1% received more than $40,000 a year in tax cuts.”  Tax cuts in Ohio over the past decade and a half are a primary reason for the shocking statistic Patton provided in a recent Policy Matters report: “By 2020, the state share of school funding had fallen to its lowest point since 1985.”

Also testifying to oppose the Senate Finance Committee’s school funding plan were Thomas Hosler, Superintendent of the Perrysburg Schools; Ryan Pendleton, Treasurer of the Akron Public Schools; and Mike Sobul of Forecast5 Analytics, all the members of the expert committee which designed the Fair School Funding Plan that is part of the House Budget—the plan which the Senate Finance Committee rejected last Tuesday.  Hosler, Pendleton, and Sobul began by pointing out that historically, Ohio school funding has relied on “residual budgeting,” a practice deemed unconstitutional in the DeRolph decision. Instead of basing the state’s school funding formula on what school district staff and programs actually cost, Ohio legislators have merely been used to plugging in a number based on current revenues available to be divided among the state’s many fiscal responsibilities.

Hosler, Pendleton, and Sobul explain that their Fair School Funding Plan would be constitutional partly because it is based on the real costs school districts must incur: “What makes the Fair School Funding Plan… unique is that for the first time we stepped away from the practice of residual budgeting to fund education, and instead, asked what it costs to educate the ‘typical’ child. We answered this question by analyzing and evaluating the national research and established best practices in education, as well as the expertise and judgement of professionals in the field to determine the funding necessary to ensure that Ohio’s youth has access to high quality educational opportunities… The Fair School Funding Plan funds students where they need it most through a meticulously constructed base cost… Constructing base costs was a painstaking process of determining component-by-component the necessary instructional and support personnel, services, and building and district leadership essential in providing every public school student the basic foundation funding…. (F)rom the outset, the Senate’s formula suggests that the end goal is to substantiate a lower base cost and not properly determine an adequate education for a typical student.”  Hosler, Pendleton, and Sobul contrast the operation of their Fair School Funding Plan  to what they believe is the Senate’s defective substitute. (You will find this testimony archived under Ryan Pendleton’s name.)

Senate leaders do increase school funding in the next two years, but their plan would fall short over the long run.  They argue that it would be irresponsible to pass the Fair School Funding Plan, which has a six year phase in as part of its design, because perhaps there won’t be enough state revenues after the FY 22-23 biennium. Ohio Education Association President Scott DiMauro pointed out last week that, with the economy recovering, the state currently has adequate revenue to launch the Fair School Funding Plan: “Clearly, from a state budget standpoint, revenue has recovered and the state is seeing pretty robust revenue growth… Just through that natural growth, there are clearly the dollars available to fully and fairly fund our schools. The Senate chose instead, rather than doing that, to impose a 5% cut to our state income tax.”

The Senate’s substitute school funding plan also increases school privatization in several ways.  First, the Ohio Senate proposes to increase the amount of already existing private school tuition vouchers from $6,000 to $7,500 for each high school voucher and from $4,650 to $5,500 for each K-8 voucher.  DiMauro puts the Senate’s proposed voucher expansion in context: “Under the Senate plan, a high school student getting a private school voucher would receive more state aid than kids attending 80% of Ohio’s public schools… K-8 voucher students would get more funding than public school students at about 50% of public schools.”

The Senate also includes two small new neo-voucher programs in its budget plan: a new tuition tax credit voucher program of up to $2,500 per year to pay private school tuition for families with income below 300 percent of the federal poverty guidelines, and a $250 tax credit for home schooling families to buy educational materials. And finally the Ohio Senate proposes to remove geographical limits on the siting of new charter schools, which were limited in the past to urban school districts and other low income communities. Now, under the Senate proposal last week, new charter schools could be scattered across the state.

The people testifying before the Senate Finance Committee last week identified important funding deficiencies in the Senate’s new plan, and they protested the diversion of tax dollars students would carry away from public schools to privatized alternatives. But there is a deeper, foundational problem here.  House and Senate versions of a new school funding plan in Ohio represent radically conflicting political ideologies. The Ohio House Fair School Funding Plan acknowledges that government has a responsibility to provide a system of public schools. The Ohio Senate adheres instead to a belief system articulated widely by former Education Secretary Betsy DeVos and promoted by organizations like EdChoice, formerly the Friedman Foundation for Educational Choice, which declares its purpose: “The EdChoice mission is to advance educational freedom and choice for all as a pathway to successful lives and a stronger society.”

In their new book, A Wolf at the Schoolhouse Door, educational historian Jack Schneider and journalist Jennifer Berkshire dig into the principles underneath school privatization: “Education is a personal good, not a collective one. It is more like private property than like a public park… Schools belong in the domain of the free market, not the government. They should be under the purview of personal preference and choice, not regulation and oversight.” (A Wolf at the Schoolhouse Door, p. xx)

Derek Black’s book, Schoolhouse Burning traces the history of the idea of public education in the United States as a public good, not merely a personal benefit. The Founders understood public schooling’s purpose as the formation of public citizens. After the Civil War, the principles underlying the public meaning education were strengthened as states of the former Confederacy were required to provide for public schooling in their state constitutions as a requirement for rejoining the Union: “All fifty state constitutions include an education clause or other language that requires the state to provide public education.  Most of these clauses were first enacted or substantially amended in the immediate aftermath of the Civil War. By law, Congress explicitly conditioned Virginia’s, Mississippi’s and Texas’s readmission to the Union based on the education rights and obligations they had just put into their constitutions…. (A)fter the Civil War, no state would ever again enter the Union without an education clause in its constitution.”  (Schoolhouse Burning, p. 53)

Under the Ohio Constitution our public schools epitomize our mutual public responsibility to Ohio’s children.  Twenty-four years ago, the justices of the Ohio Supreme Court interpreted our state constitution to require adequate school funding equitably distributed across the state’s school districts.  They explicitly rejected what they called overreliance on local property taxes. Three and a half years ago, keeping in mind that the goal of every good school funding formula is to use state taxes from wealthier communities to support quality programming in the public schools districts where the local property tax base is inadequate, the Ohio House gathered a committee of experts who drafted the Fair School Funding Plan. The goal? To ensure that students in Ohio’s poorest communities would be able to enjoy the same quality programming as students in exurbs where median income and property appraisals are higher .

The Ohio Senate has demonstrated that it is now prepared to throw away the Ohio House’s plan for adequate and equitable public school funding. Over time, the Senate’s substitute plan would fall short of adequate public school funding while driving ever more tax dollars to private and charter schools.  If the Ohio Senate passes the plan proposed last week by the Senate Finance Committee, advocates must demand that the Ohio House members serving on the budget conference committee stand firm in their support for the Fair School Funding Plan.