Wednesday, February 20, 2013

A Budget Primer - Courtesy of Steve Ross

We're finally seeing some traction for meaningful analysis of the schools budget.  I couldn't bring myself to get into the numbers, so I concentrated on process - big picture stuff. 

Thank goodness Steve Ross has a higher tolerance for putting together the actual numbers - on his own, with no help from the consultants.  It's not quite safe to assume that all of our Board members really understand how the schools get paid for.  The Tennessee School Board Association gives presentations to Boards - the Board members are not exactly without the resources to figure this stuff out.  But most of the unfortunate aspects of the public discussion has resulted because of lack of understanding by the public and by our elected officials of the fundamentals of school funding.  To the list of resources we now should add the two most recent posts from Steve Ross - Required Reading.

Steve Ross got started on Sunday.  Since then, he's been furiously writing and explaining.  First, he explains where the money comes from, then he explains where the money goes.  Great work.  Seriously, great work.

I've heard most of the pieces of this, but not in one place.  Mr. Ross has really done a lot of work to pull this together.  And his commentary is important.

And, I think, raises some questions that the County Commission needs to answer.  The state lets the County know what its minimum level of funding is.  Shelby County has funded both systems slightly over that minimum.  However, "[a]s you can see here, the County has consistently, over the past 4 years, funded the City schools less, as a percentage of BEP than the County Schools. Sure, both numbers are more than the minimum, but the lack of true parity turns into real money in short order. $63m of real money in fact."

The County Commission would likely tell us that with the extra Memphis contribution, and the fact that for capital improvements, Memphis gets $3 for every $1 in SCS capital spending, that Memphis just didn't need an equitable level of funding.  Maybe that used to fly - in a merged system, it doesn't. 

But this policy by the County Commission has real results.  What would be an example of how that little bit of extra disproportionate funding could be spent?  One example might be the shiny new Grays Creek facility that SCS built out in Arlington.  This building did not follow the usual process - through the former Needs Assessment Committee (recently disbanded) - which was put in place to make sure that capital expenditures in the two school districts were equitable.  Capital expenditures are funds spent on building buildings, repairing them, and other one-time infrastructure expenditures.  As mentioned above, the proportion was $3:$1 and generally, if SCS wanted to build a school, it would come up with the cost, and MCS would get three times that amount.  It has to do with proportionate spending between the two districts and functioned as a pain point for the county, and a point of negotiation for the city.

So how could SCS build a building that didn't go through the Needs Assessment Committee and that didn't result in equitable funding for MCS?  My understanding is that it managed to build it entirely with surplus funds.  Each year, just about any money that was left over at the end of the school year was put toward the building as a "one-time, non-recurring educational expense".  That's right, with all of the cuts that were necessary in SCS over the last few years - ask the administrators and teachers, they'll tell you how they were impacted - SCS still managed to have enough "surplus" funds to build the beautiful Grays Creek facility.

You might be for or against the merger, and you might be for or against municipal school districts.  But the merger, for the year that it exists, just might let us have a real discussion about what equitable funding looks like, why it's important, and how it impacts the classroom.

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