Rich School, Poor School: California School Finance

I want to share with you an article from the Wall Street Journal this week entitled "California Schools' Tough Choices."

Residents of some affluent cities in this broke state are banding together to make up for cuts in public education, opening rifts between rich and poor school districts. Key to the debate are parcel taxes, flat fees on property that are used by some cities to help fund public schools.

A handful of communities, such as the tony Bay Area enclave of Piedmont, Calif., have passed new parcel taxes to compensate for proposed state cutbacks, and others are considering them. Piedmont said the emergency measures would enable it to lay off only five of its 200 teachers, rather than nine.

"We're very, very fortunate that our community is supportive of our schools," said Ray Gadbois, vice president of Piedmont's school board. In less-affluent communities where voters are loath to approve parcel taxes, the state's funding cuts are expected to hit harder.

One is Hayward, 15 miles south of Piedmont. At the city's Tyrrell Elementary School, Principal Rosanna Mucetti said she stands to lose nine of 30 teachers. California requires any local tax increase for a specific purpose be approved by two-thirds of voters. Of the state's 1,042 school districts, only a small number have adopted parcel taxes. Since 1983, at least 245 such levies have been approved, including some that have been renewed, according to data from the lobbying group School Services of California.

The immediate cause of the schools' funding crisis is a California budget deficit pegged at $24 billion through June 2010. The shortfall prompted Gov. Arnold Schwarzenegger to propose cutting $5.3 billion from schools through next year -- in addition to an $8.6 billion cut announced in February. California ranks near the bottom among states in per-pupil spending.

While some states lean heavily on local property taxes for schools, California shifted the burden to the state budget, which relies mostly on the income tax, after Proposition 13 in 1978 capped property-tax rates. The state provides school districts with about 75% of their budgets and the rest comes from local taxes, said John Rogers, an education professor at the University of California at Los Angeles.

The state gives more money to districts with less revenue from property taxes, using a complicated formula to equalize per-pupil spending among districts, following a mandate from the California Supreme Court. But disparities between districts are emerging in the downturn. The state formula doesn't take into account parcel taxes, which don't reflect a property's market value. The state also doesn't factor in funds raised by private parents' clubs and foundations. These are big sources of revenue for some schools.

The journalist accurately captures the sad state of California school finance. We are well on the way to creating two types of school systems in California: a small number districts that have high revenue per student because their funding is supplemented by local parcel taxes and well-funded educational foundations, and all other school districts whose spending per student (when accounting for regional cost differences) is near the bottom of all states.

After the article was published I sent the journalist an email complimenting him on the article and stating:

I disagree however with the 75% figure Rogers stated. Sacramento controls about 90% of most school district's funding. While yes some local property taxes go to California schools, Prop. 13 gave to Sacramento the power to decide how to allocate property taxes. This is why even when property taxes increases, public schools don't necessarily benefit. Sacramento can keep the amount of funding for education unchanged by simply reducing the amount of state aid that is provided.

The journalist responded:

That 75% figure is from the professor as well as from official state numbers. It varies from district to district, so 75% is the average around the state. You are correct, though, in saying that a property-tax increase doesn’t necessary benefit public schools because Sacramento just reduces the amount that the district would get.

I have sometimes felt that San Leandro is proof that money doesn't guarantee strong schools. Our district has been able to do so much on comparatively low funding. However, there is so much more we could have in our district. Examples include teaching more foreign languages, offering a dual language immersion program at the elementary level, reducing the student to counselor ratio in the secondary schools, hiring librarians for the elementary schools, increasing staff support at school sites - which would free up time for Principals so they spend less time on administrative tasks and more time visiting classrooms and meeting with teachers, and, not to be overlooked, keeping salaries competitive to attract and retain quality teachers.

The lack of sufficient funds does negatively impact education. The recent and upcoming budget cuts will be another blow to our schools. Class sizes in Kindergarten to 3rd grade have been expanded and may be further expanded by the start of the school year depending upon what happens in the coming weeks in Sacramento. If the class size reduction program in the elementary schools is eliminated, the likelihood that music, art and sports at the middle and high school will be cut substantially increases if there is a further loss in state funding.

Our schools do not have to be almost entirely dependent on Sacramento for their funding. I would like to see the school board place a parcel tax on one of the ballots in 2010. A parcel tax is the only way for a school district to raise substantial local funds, money which can not be used by the state to reduce a district's allocation. I hope everyone thinks about these issues over the summer and discusses them with school board trustees. While obtaining 2/3 support is extremely difficult, we owe it to the children of San Leandro to try.