Wednesday, February 6, 2013

Don't Spend It Yet

The Ohio School Boards Association sent a notice to its members today which included this comment:

Today, the state Office of Budget and Management (OBM) released district-by-district spreadsheets simulating the dollars generated under the governor’s school-funding proposal. Please note that the fiscal year (FY) 2013 base excludes funding for transportation as calculated for FY 2011 and the career technical education attributed funds.

I won't claim to understand exactly what that means, but the spreadsheet the OBM sent suggests that Hilliard City Schools is in line to receive $5 million more in funding in FY14 than we received in FY13.

The first thing to say about this is: I DON'T BELIEVE IT

I'd like to believe it. An extra $5 million/yr of funding from the State changes things. If our State funding were to be $5 million/yr more for the next several years, and we were to hold spending to that projected in the Oct 2012 Five Year Forecast, then this could delay the next levy for a year, perhaps to 2015 instead of 2014.

But remember, there are several 'knobs' we can play with. Changing the levy timing is just one of them.

We could still put a levy on the ballot in 2014, but make it much smaller - say 4.4 mills instead of the 7.7 mills I estimated in October.

We could be more generous than we could have otherwise been in the next union negotiations, which will take place later this year.

Or we could plan for some combination of these factors.

More discussion than this is premature at this point, as this $5 million is just a number in the wind right now. The General Assembly still has to consider this proposal, and experience tells us that there will be additional tweaks. I'm not particularly optimistic that increased funding to districts like ours - seen to be among the more affluent in the State - is going to make it through the legislative cycle. The power in the General Assembly belongs to the urban and rural districts, not the suburbs.

Stand by for further developments.


  1. Please take note, no comment on web site about school funding. Read this week for statement from Dale and Brian.

    The gang of four will turn the knob that extracts money from my wallet for hight than market wages for next contract.

    Living in the HCSD is like living a 24/7/365 hostage situation.

  2. This is just how screwed up this funding plan is: Bettsville Local Schools in Seneca County, where my daughter happens to live, is the smallest school district in the state at 189 students K-12, over half which live below the poverty level. Median income is $26,515, compared to $47,617 here in Hilliard. The average teacher salary in Bettsville is $35,161, less than the starting salary in our district. They have never been rated higher than "Effective"

    Right next door is Old Fort Schools (literally, the next farm east of my kid's place is in the Old Fort District). The Old Fort Schools are consistently ranked Excellent.

    Why don't they just consolidate those two districts? I suspect that a big part of it is the difference in teacher comp. The Old Fort teachers average $45,942 per year, and I imagine that in a consolidation of Bettsville into Old Fort would mean the Bettsville teachers would get a substantial raise.

    But Bettsville has only 15 teachers, meaning the cost of raising them to the Old Fort average would cost about $160,000 plus benefits - maybe $225,000. Add a little for transportation, and we could end Bettsville's agony.

    So how much does Bettsville get in the Governor's new plan? Zip.

    I know this is an extreme example. But really, what sense does it make that we allow Bettsville to continue? This is one of the reasons I believe
    we have to rethink the societal value of having local public school districts with boundaries that both trap kids in low performing districts, and allow the wealthy districts to put up "Po folks keep out" signs, using public dollars.

    Of course, there are those in our school district who lament the fact that our borders have been crossed by the City of Columbus, which has allowed housing to be built that has attracted large numbers of low income families, especially immigrants.

    If we're going to call them public schools, these boundaries don't make sense.

    1. The question should have been: "So how much more does Bettsville get in the Governor's new plan?"

      Bettsville currently receives state funding of $6,600 per student. That would not change in the Governor's plan.

    2. Paul, if you consider that the last time around they permitted local authorities to "consolidate services" to save money, I would surmise that this is the first step toward the very process you are advocating.

      As you note, the cost of upping those teachers is negligible. But if I read the spreadsheet correctly while Old Fort has approximately twice the students, it gets only about 50% more State money, or about $2k per student less than Bettsville. (And Old Fort also gets a 0% increase.)

      I would suspect Bettsville's Board Members are not interested in giving up the State's "gravy train" - at least in comparison to those next door...

    3. Not sure what gravy trail you're talking about. Nobody engaged in the Bettsville schools is getting rich - certainly not the district employees. Yet Bettsville spends 80% more per student to run their schools than Old Fort, and gets lower results.

      I'm not trying to equate spending with outcome, in fact I've argued against that commonly held belief. It's hard to overstate the importance of the parents in the equation - and that may be an important factor here. The number of students living in poverty in Bettsville is 57% vs 27% in Old Fort, and higher levels of poverty almost always mean the parents have lower levels of education, and therefore are less likely to be able to reinforce the education effort.

      This one is personal - as I've said, my kid and her husband live in Bettsville. When they have kids, I pray they'll no longer live in the Bettsville school district - or that one of the better school districts around there have open enrollment.

      Until one has spent some time around these tiny and poor rural districts, it's hard to appreciate how spectacular the school districts are around here.

    4. That being said, I'll repeat a comment I've made before - those who decide to stay in these poor districts with severely resource-limited schools are doing so by choice. Many of us live were we do because we pulled up roots, and moved away from family and friends to seek better economic prospects, just as did my pioneer ancestors who settled Appalachian Ohio over 200 years ago (and struck out from Europe well before then).

      Our district is home to thousands of immigrants who made that same choice for their children. Good for them.

    5. Paul, the point was Bettsville gets more from the State per student than Old Fort. For 2 districts currently to merge it would require both agreeing. My suggestion was it's probably not Old Fort wanting to Keep Bettsville out...

      But, by not increasing budgets for these smaller districts, it might end up forcing the issue...

    6. Understand. My assumption is that in a consolidation of these two districts, whatever state money is going to Bettsville would remain intact and added to the state funding received by Old Fort. All conjecture anyway - who knows what deal would be struck if this were to happen...

  3. Maybe a bit off topic but a school district with only 189 students is ridiculous on it's face. How in the world can that be efficient? That seems to translate to 14.5 students per grade. How many teachers and admins does it take to service those 189 students? I am beginning to believe more and more that one district per county makes sense, and if not that, then some other type of consolidation. I don't see how it is possible to attract the "best and the brightest" ( a goal that WE hear with each levy campaign )teachers while paying such below market compensation. As well, it dilutes the dollars available from the state for all other districts. Doesn't seem fair for anyone.

    1. I agree with you. I grew up in West Virginia, where the public schools are organized into country-wide districts, meaning that there are only 55 school districts in the entire state. But they also have a funding system like what many want for Ohio - the state is the primary funding source, providing enough money for a district to operate without local taxes - albeit at a very minimum level. Then if the people of a county want to spend more money on their schools, they pass an "excess levy."

      The outcome isn't real different than what we have here - the more affluent counties can get their excess levies passed, and have nice schools. The poor counties barely scrape by, offering little to their kids beyond the 3 Rs (readin', 'ritin' and Route 33).

      This rich district/poor district situation is why I believe we have to rethink the way our country does public education. I think we can make sure every kid has enough money to fund a decent education without also having to own and operate public schools.

    2. Well, one district per county would be an absolute nightmare in the populous counties. I cannot for one minute picture my kids in CPS, and I would strongly suspect I am not alone in that matter :)

    3. Of course, the only reason we have these huge outer-ring suburban districts is the 'white flight' caused by the busing-for-desegregation court order in the late 1970s. The outcome has been the very segregation that the Penick lawsuit was meant to erase. "Getting Around Brown" by Gregory Jacobs is an excellent analysis of that tragedy.

      Another consequence has been the rapid expansion of suburban districts without much in the way of a commercial tax bases, which largely remains within the City of Columbus. This means our region's suburban schools must be significantly funded by residential property taxes, and almost all of the incremental revenue must come from residential taxpayers.

  4. Paul,

    I would like to think all schools are local and like the control (well what we should have) in our little village.

    I hate to always address salary. We always hear about teachers being part of the community. A first year teacher as a single worker makes makes @ 84% of number you posted and 10 years later with no changes to the pay grid will be making 130%. Do you think the community number will rise at the same rate.

    The teachers salary for 185 days has been growning faster than the community and will continue to do so even if the same pay scale is used for the next 10 years. One the new contracts add money they will well outpace community income.

    The average teacher out earns the median household, 50% live outside the community. This is a reverse robin hood take from the poor and give to the poor.


    1. There is a serious problem, IMO, in comparing teacher salaries to median incomes. The latter includes all residents, whether they are working or not. A retiree living on social security drags down the median income of the entire area, but it wouldn't be appropriate to use that as a basis for suppressing the pay of a worker - pay for workers should be based on pay of other people working, accounting for skill, supply and demand, etc.

      We could take the argument to an extreme and say imagine a nursing home for indigents off by itself in a remote area. Essentially all the residents of the area are nurses at the home or residents. The median income will be abysmal. Should the nurses get paid nothing because of the low median income?

      As a state, median teacher salaries have actually increased significantly slower than median income over the past 25 years, but this does vary by district. My district has seen teacher salaries outpace median income, but that is largely because the district has seen an ever-growing % of its population in retirement. Fewer workers = slower median income growth. But our district has to compete against neighboring districts for teachers, and those neighboring districts have significantly higher median income. As they have driven salaries up, we've had to match to keep employees, regardless of what the local median income is doing.

      That said, teacher salaries in Hilliard may be outsized... but comparing to median incomes is inappropriate without consideration as to the supply/demand and the wages of those actually working as opposed to retired or unemployed but without the skills necessary to compete.

      At the same time, it would be nice if Kasich and his cronies could understand that wealth is not defined by property value. His new formula bases state support almost entirely on property $ per pupil. My district has almost the exact same property $ per pupil as a neighboring district. Their median household income is nearly twice ours.

      According to Kasich, we're as wealthy as they are. I say otherwise. *I* can afford the tax increases that our district will need if they are going to replace the massive loss in revenue we've faced. But many retirees can't. I don't feel that sorry for retirees who retired on razor thin budgets with no provisions for property taxes increasing at the rate of general inflation (and I know FAR too many who have done this). But those who prepared well shouldn't be faced with 30-40% hikes in school taxes because the governor decided they are suddenly wealthy.

    2. Median income is probably a fair indicator of the capacity of the school district to tolerate higher taxes. I also believe that property value generally correlates to both income and wealth, although this is less true of seniors.

      We can also have a conversation about inflation. Rising prices for certain things isn't inflation. Gasoline prices are going up because the oil companies know they can stick it to us, and we'll keep buying it anyway. They're like drug dealers who know the most profitable condition is when the buyer is alive enough to find money to buy more drugs, but right at the edge death. Dead addicts don't spend any money, and neither does a dead economy.

      Neither are home prices or salaries a function of inflation, especially when there isn't any inflation. But are a function of supply and demand - which is why home prices in places like California shot up like a rocket and crashed just as spectacularly, while ours stayed comparatively stable.

      I'm not sure we really compete with other districts for teachers. There are distortions in the system caused by the collective bargaining agreements. For example, Article 29, paragraph C of the current contract with the Hilliard teachers' union says: "All bargaining unit members at the initial time of employment will be permitted to transfer a maximum of ten (10) years of earned teaching experience." So we can't hire senior teachers unless they're willing to give up their seniority. You could argue that this suppressed salaries.

      And when we have openings, we get hundreds of qualified applicants for just a few positions. In most cases, this would signal the employer that the salaries offered could be lowered. But again, the CBA sets the pay rate.

      The property value per student is heavily influenced by the commercial/residential mix. You may know that we interviewed Michael Sawyers, the acting State Superintendent. He told us the story about Perry Local Schools up in Lake County, where he had served as Superintendent. The folks who live there have low property values and low incomes. But they also have the Perry Nuclear Power Plant in their district, and it at one time generated enough tax revenue that they built a $100 million campus with cash.

      That's an extreme case, but there are districts of all mixes here in central Ohio. Some are essentially all residential - ie Bexley 95% residential, 5% commercial - while others have a substantial commercial tax base: Whitehall 58% residential, 42% commercial/utility for example. Hilliard is 75% residential, 25% commercial/utility.

      By the way, those of us who are retirees living on our nest egg didn't foresee that our government would drive interest rates to 0% for many years. Interest is income to us. The way we see it, the decision of the government to tinker with interest rates rather than allow the free market to set rates, is essentially a very expensive tax on us.

      We have an incredibly complex economy in America, made all the more so by the distortions created by our government - Democrats and Republicans alike - to meet their political objectives. It's gonna bite us sometime soon. Hopefully the wound isn't fatal.

  5. CSD spends more per student than most suburban districts ans still has dismal results. Proves that money doesn't buy everything.....

    1. Indeed. One of the strongest predictors of academic performance is poverty - inversely related of course. The school districts that have the high per-student spending in this state fall in one of two categories: a) the districts with high poverty where an attempt is made to compensate for inability for a kid to get support in the home; and, b) the wealthy communities who spend a lot to provide extraordinary opportunities for their kids.

      There a plenty of communities in this state who get good results with modest resources. But those are situations where the kids are raised in households where the parents have a decent education, and where they don't spend a lot on stuff beyond the requirements.

  6. Your last sentence sums it up - parentS with a decent education, capital S intentional. Sometimes I wonder if our staff realizes how well they have it compared to the challenges of teaching in the inner city/big urban districts. They get paid to come to work with motivated students, with beautiful facilities and what seems to be a relatively unlimited budget, and the vast majority of graduates go on to higher education, albeit still needing some remedial classes to be fully prepared for college. I hope they realize that when the next contract is being discussed......

    1. There is an age old argument about 'nature vs nurture.' All I know is that it's a multi-dimensional problem, and settling in on simple solutions is a mistake. There are poor kids who in families where parents have little education, yet the kids do fine. A there are the rich kids of highly educated parents who struggle.

      I personally think that video games are one of the great evils in our society. And that's coming from someone who spent a lifetime in computer technology. But I see far too many kids who gain great skill in the video game world instead of the real world. I also think that the fidelity of the simulations in the more violent games is getting so good that they are molding the minds of the kids who spend hours playing them. I understand that some games evoke biochemical activity that mimics real fight-or-flight situations, leading to the development of the same kinds of thinking patterns one develops when exposed to real danger. Are these games causing PTSD in our children, with similar consequences as it does in those who have gone to war?