Vic’s Statehouse Notes #121– February 25, 2013

Dear Friends,

The House Republican budget bill HB 1001 will be voted on later today, Monday, February 25th. No doubt it will pass.

While it gives more money to education than the Governor’s budget did, it falls far short in the effort to restore public school funding to pre-recession levels. About $150 million more each year would be needed to reach pre-recession levels, a figure explained below.

Then with the passage of the voucher expansion bill, at least $21 million of the $129 million dollars budgeted next year for tuition support – about one sixth -- will flow to private schools rather than to public schools.

Budgets are hard to track and easy to camouflage with misleading statistics. I think the best way to track funding for education is to look at actual dollars each year:

Current actual FY2013 funding for tuition support: $6.500 Billion (from the HB 1001 funding formula)

Proposed FY2014 budget for tuition support: $6.629 Billion (+$129 Million over current year)

Proposed FY2015 budget for tuition support: $6.694 Billion (+$194 Million over current year)

New money budgeted over two years: (+$323 Million – two year total)

HB1003 vouchers for students already in private schools FY2014: $21 Million (see Statehouse Notes #119)

FY2104 new tuition support for public & charter schools: $129 Million minus $21 M equals $108 Million

HB1003 vouchers for students already in private schools FY2015: $21 Million

FY2015 new tuition support for public & charter schools: $194 M minus $21 M equals $173 Million

Actual new money budgeted for public and charter schools over two years: $108 M + $173M = $281 Million

The conclusion is that with voucher expansion in HB 1003, tuition support will be well under the well publicized 2% increase in the first year and 1% in the second year of the budget.

How much tuition support would restore the money lost to public schools during the Great Recession?

In budgets written from 1999 through 2009, tuition support was increased from 1% to 4% depending on economic conditions. In 2011, tuition support was reduced drastically (-4.5%) in response to the Great Recession and falling state revenues. Details of this cut can be seen HERE.

The last somewhat normal budget for FY2011 devoted $6.57 billion to tuition support. The next budget for FY2012 cut that amount to $6.28 billion, almost $300 million less. If we would go back to FY2011 and figure just a 1% increase each year (such as the House Republican leadership has proposed for FY2015), where would the tuition support budget be this year? Here are the projected figures to answer that question:

FY2011 $6.57 billion

FY2012 $6.64 billion (+1%)

FY2013 $6.70 billion (+1%)

FY2014 $6.77 billion (+1%) (Compare to $6.63 billion in today’s HB 1001 = $140 Million short)

FY2015 $6.84 billion (+1%) (Compare to $6.69 billion in today’s HB 1001) = $150 Million short)

Thus, figuring a conservative 1% increase, restoring funding to education that was cut in the Great Recession would require $290 million additional new dollars for tuition support than the House Republicans have budgeted. They have offered $323 million over two years, which falls to $281 million (see above) when voucher expansion is figured in. The conclusion is that the budget increase for tuition support would need to be doubled in this budget to restore education funding to levels before the Great Recession.

Specific Budget Line Items

All of the discussion above is about the biggest line item in the budget, tuition support. There are many smaller line items in the budget which deserve attention as well. Some were raised, some were cut and some disappeared. Here is a sampling for your review:

.....................................2011 Budget..........2013 House Budget, Feb. 25th
................................FY 2012.......FY 2013........FY 2014........FY 2015
Items Raised
..Performance Awards............$6.0 M........$9.0 M..........$11.0 M........$11.0 M

Items Cut
..IEERB.........................$1.54 M.......$1.54 M.........$.99 M.........$.99 M
..Alternative Education.........$6.32 M.......$6.32 M.........$6.14 M........$6.14 M
..Sen. Ford Tech Fund...........$3.43 M.......$3.43 M.........$3.09 M........$3.09 M

Items New
..Works Councils......................0.............0.........$1.0 M.........$5.0 M
..Charter School Board................0.............0.........$.75 M.........$.50 M
..Drop Out Prevention.................0.............0.........$6.0 M.........$6.0 M
..Principal’s Leadership Acad.........0.............0.........$.38 M.........$.38 M
..STEM Teacher Recruitment............0.............0.........$5.0 M.........$5.0 M
..School Performance Awards...........0.............0..............0.........$16.7 M

Items that Disappeared
..Full-Day Kind Grants..........$81.9 M.......$81.9 M........now in tuition support

Items that Disappeared in 2011 and remain gone
..Professional Development
..Circuit Breaker Grants

Items that Stayed the Same
..Testing and Remediation......$46.23 M......$46.23 M........$46.23M.......$46.23 M
..State Board and Roundtable...$3.70 M.......$3.70 M.........$3.70 M.......$3.70 M
..Non-English Speaking Program.$5.00 M.......$5.00 M.........$5.00 M.......$5.00 M
..Gifted and Talented..........$12.55 M......$12.55 M........$12.55 M......$12.55 M
..Summer School................$18.36 M......$18.36 M........$18.36 M......$18.36 M
..F/R Textbooks Reimbursement..$39.0 M.......$39.0 M.........$39.0 M.......$39.0 M
..Innovation Fund – New Tech...$2.5 M........$2.5 M..........$2.5 M........$2.5 M

Concerns about Specific Items

• It makes no sense to cut the Sen. Ford Technology Fund. Schools are expected to expand technology capacity to administer ISTEP online. That will take more money.
• It makes no sense to cut Alternative Education and then add $6 million in a new fund for Drop Out Prevention. Alternative schools in Indiana are working overtime to prevent drop outs. They deserve the additional funding to keep more students from dropping out.
• Greater numbers are now on free or reduced lunch due to the recession, but funding for textbooks for free and reduced lunch students has been frozen for years. The excess percentage not paid by the state comes out of the General Fund of each local district budget. When districts have a high percentage on free or reduced lunch, this extra expense for textbooks becomes a budget burden that cuts funds which might help all students. In contrast, textbooks for home school and private school parents are tax deductible.
• Much has been written recently about the summer learning loss. Better summer school programs could remedy that problem, but the summer school budget remains frozen at the same level it has had for years.

Next Steps

Share these and other budget concerns you may have with members of the Senate. The biggest problem is the mediocre effort to restore tuition support to pre-recession levels when clearly the well-publicized surpluses show that more money is now available. Senate Republicans will now craft their own budget, which will be reconciled with this House Republican budget in April.

To see what is happening to public education, we all must follow the money. Thanks for standing up for public education!

Best wishes,

Vic Smith

ICPE is working to promote public education and oppose privatization of schools in the Statehouse. To keep our outstanding lobbyist Joel Hand in place, who shared the budget concerns of ICPE members during public testimony on this budget bill, we need all members from last year to renew and we need new members who support public education. Please join us!

Go to www.icpe2011.com for membership and renewal information.

Some readers have asked about my background in Indiana public schools.  Thanks for asking!  Here is a brief bio:

I am a lifelong Hoosier and began teaching in 1969.  I served as a social studies teacher, curriculum developer, state research and evaluation consultant, state social studies consultant, district social studies supervisor, assistant principal, principal, educational association staff member, and adjunct university professor.   I worked for Garrett-Keyser-Butler Schools, the Indiana University Social Studies Development Center, the Indiana Department of Education, the Indianapolis Public Schools, IUPUI, and the Indiana Urban Schools Association, from which I retired as Associate Director in 2009.  I hold three degrees: B.A. in Ed., Ball State University, 1969; M.S. in Ed., Indiana University, 1972; and Ed.D., Indiana University, 1977, along with a Teacher’s Life License and a Superintendent’s License, 1998.