Wednesday, May 27, 2020

Vouchers Especially Hurt Poor Kids

As has been recently reported in the Columbus Dispatch and other places, a group of public education advocates is looking to sue the state over the EdChoice voucher system -- an argument I've been making for years.

But in the article, pro-voucher forces make a curious argument -- that those seeking to undo the harm voucher do to primarily poor and special need kids are actually trying to hurt those kids.

“It’s an all-time low for government school activists to try to rip low-income and special-needs students out of their schools right now,” said Aaron Baer, president of Citizens for Community Values. 

“It’s clear that this special-interest group cares less about what’s best for kids, and more about their own narrow social agenda. Ohio’s EdChoice program is a lifeline to tens of thousands of families. It allows underprivileged and underserved children the opportunity to find an education that best meets their needs.”
First of all, it's not "government school"; it's "public school", which means our school. None other than Thomas Jefferson described it this way in the Land Ordiannce of 1785. "Public school" were Jefferson's words.

But I digress.

Here's the problem. Yes. It's true that poor and special needs students get vouchers and attend private schools using them. However, in order for that to happen, poor and special needs students in the public schools who don't take the voucher are left with fewer resources for their educations because the vouchers exist.

This is why, for example, as a state legislator I always voted against the special needs voucher that eventually became the Jon Peterson Voucher program. Because it set aside 1/3 of the money the state spent on special needs students to serve 3 percent of the special needs kids. So the voucher program would leave 97 percent of special needs students with only 2/3 of the money they needed.

Let's look at Parma with its 47% economically disadvanatged and nearly 2/3 minority populations.

Prior to losing voucher money and students, kids in Parma were slated to receive $13,663 per pupil in state and local funding for their educations. However, once all the vouchers were removed from the district, along with the students, kids in Parma only got $13,426. That's a $236 per pupil loss in total aid, which means there wasn't enough locally raised revenue to make up for the revenue these kids lost to the state's voucher programs.

So while some poor and special needs students certainly got vouchers, far more poor and special needs students in Parma got $236 less than they needed because of the vouchers.

In fact, in nearly 3 of 4 Ohio school districts, every poor and special needs student got less overall funding because of the voucher.

But what about those 1in 4 districts that saw greater per pupil revenue because of vouchers, you may ask? Well in those districts, the reliance on local property taxes increased as much as 10 percent, forcing those districts to tax themselves at higher rates to make up for the lost state evenue brought on by vouchers (all districts had to do this to some degree).

So in these districts (which also tend to be poorer), the need to go for levies increased at a substantially higher rate. Need I remind everyone that the Ohio Supreme Court has ruled four times that increasing reliance on local property taxes to pay for schools is unconstitutional?

I know I don't have to remind the folks who want to file this litigation because they're the same ones that won that major victory for kids in the late 1990s and 2000s.

So vouchers either directly harm poor and special needs students by cutting their overall education fudning, or force poorer communities to tax themselves at higher rates to make up for the loss of state aid from the state's voucher programs -- in clear violation of the Ohio Supreme Court's four rulings.

Oh yeah, and in 8 of 10 Ohio school districts where private voucher providers reside, the school district outperforms the private option by an average of 27 percentage points. When privates outperform districts, it's in 2 of 10 cases and by only 9 percentage points.

So not even the claim that these are better overall options for kids is true. But at leats those pushing for vouchers are willing to make sure that more than a million students in Ohio's public schools get fewer resources than they need. 

Tuesday, May 19, 2020

For-Profit Colleges Chew Up Ohio CARES Act Higher Ed Money

While much of the focus on the $2.3 trillion CARES Act has been on the K-12 funding provided in it, the $13.5 billion in higher ed money was also a large inevstment. However, according to data compiled by the University of Wisconsin, in Ohio, students in for-profit colleges have received more than double the amount of per student funding than students in Ohio's public and private, non-profit colleges and universities.

This is not the outcome that was needed.

Here is the average per student CARES Act funding by college type:

What's also interesting is private, non-profit colleges received more CARES Act, taxpayer funding than Ohio's public universities.

In fact, there is only 1 four-year public university of 14 (Central State) and 8 2-year public colleges (of 69) that received more CARES Act per student funding than the average for-profit college.

How for-profit colleges and private, non-profit colleges receive more per student CARES Act funding than public colleges and universities is shocking. One would think that public stimulus funding should benefit publicly funded institutions more than the non-taxpayer funded institutions.

But what do I know.

Thursday, May 7, 2020

State Hides the Ball on K-12 COVID Cuts

This is why I think people are driven nuts by government.

A couple days ago, Gov. Mike DeWine announced a $300 million cut would be coming in this school year for Ohio's K-12 school districts due to the COVID crisis. Very understandable. Absent the feds granting states flexibility on CARES Act stimulus money and doing another COVID rescue package for education, states and local governments, big cuts like what DeWine announced are expected.

We'll leave the debate over the state's $2.3 billion rainy day fund for another day.

But when DeWine's Office of Budget and Management (OBM) listed the district-by-district cuts ("runs" is what we call it in the biz), the percentage cuts didn't look all that bad. Between 1% and 2.8%. Given that $300 million is about 4% of the state aid handed out this last school year, that didn't jibe to me.

That's when I noticed that OBM was comparing the amount of money cut to all money being spent in a school district. That's all money spent. State, local and federal. So, yeah, it looks like the cut isn't that bad when you look at it that way.

But it's completely misleading. Why? Because the state has zero say in how much federal and local money is spent or raised in a district. So the state is taking credit for money it didn't send to or raise in the district.

I can honestly say I've never seen a district-by-district run expressed this way. Every other run I've seen has compared how much state money districts were receiving and how much they will be receiving now.

In fact, it's how DeWine put out his district-by-district runs last year during the budget. He compared his state funding increase (from wraparound services money) with the state funding schools received the prior year. That makes the percentage increase look bigger. If he compared it with a district's overall spend, the increase would have seemed smaller.

It's a budgetary parlor trick.

On the Surface, these Cuts Look Fair

So what's the real state cut, in terms that have always been used?

The average Ohio school district will get cut 5.9%, with some getting cut 55%. Half of districts will get cut more than 3.8%. Half get cut less.

But there is a silver lining to this. The largest percentage cuts are disproporitionately in wealthier, suburban communities. The smallest percentage cuts are in poorer communities less able to withstand them. So that 55% cut? It's in Rocky River in Cuyahoga County, which doesn't get much state funding anyway because it's so wealthy. Other major percentage cuts are in Upper Arlington (53.6%), Independence (51.4%) and Inidian Hill (47.9%). All tolled, suburban and wealthy suburban districts will absorb 41 percent of all the costs, even though they only make up about 17.7% of the state's foundation funding.

In Ohio's major urban districts (Akron, Canton, Cincinnati, Cleveland, Columbus, Dayton, Toledo, Youngstown), the typical cut will be 1.8%. The poorest, rural districts will get an average 3.1% cut.

So while those cuts in Ohio's most vulnerable communities will be less, they will still be meaningful. There just isn't enough money being sent to the wealthiest schools to Robin Hood the cuts for very long.

But Ohio's Most Vulnerable Districts Still Get Disproportionately Hurt

While the percentage cut in Ohio's most vulnerable communities is less than its wealthiest ones, because there just isn't enough money being sent to the the wealthiest districts to absorb all the cuts, the relative amount being cut in Ohio's most vulnerable communities is actually higher.

Let me explain.

The way education funding works in Ohio is the state figures out how much it should cost to educate kids in your district, then determines how much of that cost you should be able to pick up based on your property tax values. The state then picks up the rest. And while there are serious problems with the way Ohio does this because the state formula for determining the cost isn't an actual formula, that's the calculus.

The issue though is everything hinges on the ability to raise local money through property tax levies. Districts that raise more ("wealthier"), have less state money coming to them. Those that raise less ("poorer"), have more state money coming. (And there are districts that aren't "wealthy" that are classified as such, like Coventry and Danbury, but that's another topic for another post).

The problem with this system is when state cuts come to districts, poorer districts' budgets are far more sensitive to state funding losses because they raise so much less locally. So a relatively modest cut in a poor, rural Ohio district could mean that district now has to go out for a larger levy (which won't likely pass) or cut services. Meanwhile, even a larger cut in a wealthier district won't have the same impact because they could raise even a tiny additional levy amount to cover it.

So even though 40.9% of all the money being cut is coming out of wealthier districts, the relative cut is worse in Ohio's poorer communities.

For example, on average, Ohio's poor, rural districts would have to raise 15% more local money to make up for their cut than the average welathy, suburban district. Likewise, the average major urban district would have to raise a 36% larger levy to replace its lost state revenue than the wealthy, suburban district.

Rocky River's seemingly massive 55.2% cut? In actuality, they would have to raise a 0.88-mill levy to cover that loss. Meanwhile, even though Trimble Local in tiny Noble County only gets cut by 0.7%, -- the state's smallest percentage cut -- they would need a 1.55-mill levy to cover the cost. That's nearly double the levy needed to cover state costs from a community with a 40% lower median income than Rocky River.

Younsgtown would have to come up with nearly 2 mills of local levy money to cover their 0.8% cut. Lorain needs 1.55 mills to cover its 1% cut.

You get the idea.

Any Education Cut Hurts Vulnerable Kids Most. Period. Thats' Why We Need Federal Stimulus. Now!

So while DeWine did an admirable job trying to deflect a large chunk of these cuts onto the districts that could shoulder them best, because there simply isn't enough money being sent to the state's wealthier districts, the seemingly palty percentage of state funding cuts in Ohio's most vulnerable communities are still disproportionately burdensome to them.

It's simply a function of local ability to raise revenue to replace the state money.

This is why we need a real state formula and investment in education funding -- a task that seemed so possible pre-COVID and now seems like a pipe dream.

The other issue is timing.

These cuts, assuming they go through shortly, would be deducted from payments the state will be making to districts in May and June. There are 4 payments made in these two months, with one scheduled to be made tomorrow.

So over 3 payments, districts will have to absorb all the cuts.

While it's tough to do a district-by-district anylsis of this impact quickly, overall, the bi-monthly state payment to districts is about $336 million. So this cut will mean that instead of three bi-monthly payments at the end of this school year, districts will essentially only get two.

That could mean serious logistical problems for districts, which may have already made purchases or paid salaries that the payments were expected to cover. Now that they won't, what will happen?

This will be a quite concerning offshoot of these cuts.

And again these cuts are only for this school year. Next school year, expect more. And next biennial budget expect even more.

Unless the feds step in and free up CARES Act money and pass additional stimulus money. And the state taps its significant rainy day fund.

Until then, look out. Take cover. And pray.