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Ranking brings school funding model under scrutiny

Ohio ranks 17th in school finance, according to national report.


Ohio recently was ranked 17th in the nation for its school finance, despite the fact that Ohio’s school funding model has been declared unconstitutional three times since 1997.

The ranking, coming just weeks before Gov. John Kasich plans to reveal a new school funding model, was part of an Education Week study by Quality Counts. Each year, the company compares education across the country on multiple metrics.

The 2013 study, released this month, graded and ranked states via six indicators: K-12 achievement, the teaching profession, transitions and alignment, school finance, chance for success, and standards, assessments and accountability.

But the element that most stood out, amid recent levy failures and repeated calls for overhaul at the state and local levels, was the relatively high ranking Ohio received for school finance.

The Quality Counts data primarily focused on per-pupil spending and the relationship between district funding and local property wealth.

HOW STATES FUND SCHOOLS

Ohio, like many other states, relies heavily on local property taxes to fund its schools. That revenue is augmented by state and federal funds, which declined in recent years.

Other funding routes across the country include sales tax and income tax, as well as smaller pots of money generated by sources such as lotteries, casinos and cigarette taxes.

According to the Quality Counts study, the states that rated the highest in school finance were Wyoming, West Virginia, New York, Vermont and Connecticut.

Wyoming gets additional funds from oil and natural gas severance tax, and is with New York and Connecticut in being among the states with the top per-capita incomes.

As Ohio’s was in 1997, West Virginia’s school funding model was declared unconstitutional in 1982. West Virginia has since implemented a system that increased assessed property valuations and made local school districts responsible for a larger portion of the basic foundation program.

In Vermont, state legislators went in the opposite direction. In 1997, Vermont began providing its districts with total state funding. This replaced a similar system to that of Ohio in which local school district property taxes were added to some state aid.

In some of Ohio’s neighboring states, like Indiana and Michigan, the state accrues tax revenue and distributes it to the school districts. These states then mandate how much each district can get per pupil and/or how much they can spend.

NO ONE-SIZE-FITS-ALL SOLUTION

Mike Griffith is the senior school finance analyst for the Education Commission of the States, a nonprofit, nonpartisan organization endorsed by the U.S. Department of Education.

Griffith said the definition of education continually changes, with evolving technology and job markets, as do the needs of the states. Add to that the fact that public schools provide multiple functions — education, busing, nutrition, counseling, sports, etc. — and districts’ funding needs gain further dimension.

“No one school funding system works for all states,” Griffith said, citing substantial differences in demographics, state budgets, revenue sources and politics. “Ohio is one of a handful of states that have had its school funding model declared unconsitituional, including Kansas, Wyoming and New Jersey.”

Griffith said the most important aspect of that declaration is what each state does in response.

“In those situations, you tend to see big changes in the school funding system. For example, in Kansas, the court said if you don’t fund schools at a certain level, you can’t start the new school year,” Griffith said. “It was like a game of chicken. Eventually, the legislators broke down and changed the funding system.”

Griffith, who graduated from Ohio State University, said that kind of change didn’t happen in Ohio because a solution has not been defined and there has been no concrete incentive to make that change.

ISSUES SPECIFIC TO OHIO

In Ohio, citizens are asked to approve funding for the operations of local schools. According to court documents, the reason Ohio’s school funding model was declared unconstitutional was because it failed to provide a “thorough and efficient” educational system as directed by the Ohio Constitution.

This lack of efficiency became increasingly pronounced locally in November, as 11 of the 12 new-money school levies failed in the Miami Valley.

Deborah Minix of Butler Twp. said voters are tired of being asked to fund schools, and that she believed state funding makes more sense.

“Everybody wants the kids to be taken care of and nobody wants to harm the teachers, but we’ve come to a limit in the amounts of money people can pay,” she said. “Many people are on a fixed income and paying more taxes is just not an option.”

West Carrollton Superintendent Rusty Clifford — whose district saw its last four requests for new money fail, including one in November — said the critical factor in the Ohio funding equation is choice.

“How many choices do citizens in Ohio have about the taxes that they pay? This (school funding) is one,” Clifford said. “They don’t have a choice when sales tax gets raised, they just pay it; when the gas bill gets raised, they just pay it. This is the biggest one that everybody in the state says, ‘Wow, I don’t want to pay it.’ “

Griffith said Ohio is further hampered by an overly complex funding formula, and more frequent transition at the legislative level.

“Most states have a major state overhaul once every 20 years, but Ohio has one once every three to five years,” Griffith said. “Once you introduce a new system, it takes a while to work out the kinks.”

FUTURE OF SCHOOL FUNDING

Experts say the current trend in state school funding models is to move toward that of Vermont: away from local funding and toward state funding.

“It’s because of the economic downturn,” Griffith said. “When states made cuts in the past few years, the local districts had to raise more money. We saw a more pronounced separation between the haves and have nots. And now, even the wealthy districts are having trouble passing levies.”

He said the next two years are expected to be better, since the economy is rebounding and states are expected to be able to provide more money to local school districts.

And, under Ohio’s current funding model, there will continue to be a need for local districts to pass levies.

“Really, what it comes down to, school funding is like a garden,” Griffith said. “You never finish with a garden. You need to keep working on it, and finding ways to make things grow.”



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