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Judge Rejects School-Funding Formula in R.I.

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A Rhode Island Superior Court judge has struck down the state's school-funding formula, arguing that the current system gives students in wealthy districts an unfair edge over children attending schools in poorer communities.

Judge Thomas Needham said in his decision last month that the current formula, which is heavily reliant on property taxes to fund public schools, violates the state constitution's promise of an equal education for all students.

"The right to education is the right of every citizen of Rhode Island,'' Judge Needham asserted. "It is a right, regardless of where a child lives.''

The school-finance lawsuit was filed last year by the towns of Woonsocket, Pawtucket, and West Warwick. The plaintiffs argued that the state formula discriminates against poor communities, which generally have lower property values.

The suit was in part the impetus for a school-finance-reform measure now being considered in the legislature. (See Education Week, Feb. 16, 1994.)

The $265 million proposal, called the "guaranteed student entitlement,'' would make districts less dependent on property taxes for funding.

The plan, which was drafted by Commissioner of Education Peter McWalters and other state officials, has widespread support in the education community and the endorsement of Gov. Bruce Sundlun.

Several key school leaders said early last month that they believed a court ruling in favor of the towns would compel the state to adopt the G.S.E. or similar reform legislation.

Step in the Right Direction

In a prepared statement, the Governor praised the court decision, stressing that "there must be equal educational opportunity for all students in Rhode Island schools--those who come from poor inner cities and those who come from the affluent suburbs.''

"The G.S.E. is a step in that direction,'' Mr. Sundlun added, "and I hope the court will give it favorable consideration.''

But he cautioned that the court's directive comes at a difficult time for the state, which has been under severe fiscal pressures in recent years. The administration is now putting the finishing touches on next year's budget.

Some state officials have proposed paying for school-finance reform by raising state income or sales taxes, but it is not clear whether state politicians would support such a move during an election year.

In his decision, Judge Needham indicated that the legislature would have to seek an alternative to the current formula or risk failing in its duty to craft laws meeting the needs of all communities.
While "It is not the court's intent to second-guess the [G.S.E.] legislation,'' Judge Needham added, he said he intends to advise the towns on whether the proposed reforms "meet constitutional muster.''

The Price They Pay

The court found that wealthy districts tend to provide a better and more expensive education for their public school students.

Judge Needham pointed to higher dropout rates and lower test scores in poor communities as proof that students have an unfair advantage in affluent districts, where schools generally have more resources for curriculum and staffing.

A comparison study cited by the court revealed that the communities with the most property wealth spend more than $25 million more on education than areas with the lowest property values.

And yet, Judge Needham pointed out, poor districts often have a higher price to pay for schooling of their larger numbers of disadvantaged, limited-English-proficient, and special-education students. Those students can cost up to twice as much to educate, he said.

The state's current school-finance system is based on districts' per-capita income, as well as local property values.

The system also allows districts to recoup some of their expenditures from the state. That gives an advantage to wealthy districts, which can raise and spend more money and get reimbursement for it.

Poor school systems, on the other hand, tend to have little budgetary discretion and, therefore, to spend less on education despite the promise of a state payback.

Under the G.S.E., state funding for students with special needs would be weighted, and the legislature would set a statewide property-tax rate to bring down the rates in overburdened areas.

The proposal would also boost the state's average per-pupil expenditure to about $6,500 annually.

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