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States To Focus on Schools, Tax Cuts in 1998

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Record budget surpluses, next fall's elections, and a host of pressing school needs could make education the issue du jour in states' 1998 legislative sessions.

Some states will have no choice, thanks to court-ordered deadlines for fixing their school aid systems. But several other states plan to tackle school accountability without judicial prodding. And school construction, early-childhood development, and teacher training also figure to be salient topics.

"All of the pollsters we talk to say that education will be a top election issue," said Julie Bell, the director of education programs for the National Conference of State Legislatures in Denver. "It will be a hot one."

Gov. George Voinovich

At the same time, incumbents in the fall's 36 gubernatorial and 6,199 legislative races are also expected to crusade for tax cuts this year.

"It seems that there's a great deal of pressure to return money to taxpayers," said Nebraska state Sen. Ardyce L. Bohlke, an Independent, who is the vice chairwoman of the Denver-based Education Commission of the States. "Others see the opportunity to meet needs. In the end, [legislators] will do a bit of both."

Fiscally Flush

Thanks to a healthy economy and shrinking welfare rolls, the 50 states finished the 1997 fiscal year with a total budget surplus of about 8 percent, or $28 billion--the biggest since 1980. And the National Association of State Budget Officers projects a combined 6 percent state budget surplus for the current fiscal year, or $24 billion.

Gov. Mel Carnahan

"We don't see any reason that fiscal 1999 is going to be any less robust," said David S. Liebschutz, the associate director of the Center for the Study of the States in Albany, N.Y.

While 34 states used the fiscal wiggle room to cut taxes during last year's sessions, lawmakers still raised total state aid for schools 7.2 percent from the previous funding cycle, according to the center.

A similar mix of policies could crop up this year. Already, 16 legislatures expect to consider tax cuts in 1998, a new NCSL survey shows. With a projected budget surplus of up to $1.6 billion by the end of fiscal 1999, Indiana's Republican Assembly want to freeze property-tax rates. And Democratic Gov. Zell Miller of Georgia is backing a plan to cut $250 in personal income taxes. For Georgia and most other states, fiscal 1999 begins July 1.

Court Orders

But the NCSL survey found that school funding will be the states' top spending priority, especially where courts have ordered changes to school aid formulas.

Alabama, Arizona, New Hampshire, Ohio, Wyoming, and West Virginia all face court-mandated deadlines this year to fix funding inequities.

Ohio legislators have struggled since last spring to meet a state supreme court order to revamp their property-tax-based aid formula. ("Voinovich Pushes Sales-Tax Hike for Schools," July 9, 1997.)

Lawmakers have until Feb. 4 to put a tax increase on the May primary ballot, as Gov. George V. Voinovich, a Republican, has proposed. And Arizona has until June 30 to draft a facility funding plan acceptable to the courts, which have thrown out three prior legislative plans.

The ill-fated efforts could get a boost from Arizona's new governor, Jane Dee Hull, a Republican and former teacher. Ms. Hull was secretary of state last fall when she automatically moved up to the state's top job after Gov. Fife Symington was convicted on seven counts of fraud and resigned. ("High Court's Opinion Directs Arizona Back to the Drawing Board on Funding," in This Week's News.)

Enrollment growth, combined with the strong economy, could also prompt new initiatives to meet facility needs.

Nationwide, K-12 enrollment rose an estimated 1.4 percent between September 1996 and September 1997, to a record 46.3 million. Western states saw a 2.4 percent jump. But schools have had little extra construction support since the U.S. General Accounting Office reported in 1995 that America's schools needed $112 billion worth of repairs and renovations.

GOP Gov. Pete Wilson of California is already calling for a $8 billion in state construction bonds. Lawmakers in New York, Virginia, and Illinois are also talking facilities. ("Gov. Wilson Outlines Bold Plans for Calif. School Reform," in This Week's News.)

Similar efforts failed last year, but 1998 could be different.

Legislators "found out they had extra money at the end of last year," Ms. Bell of the NCSL said. "This year, they're going in knowing it's a good year and that there is this need."

State leaders are also looking at early-childhood development and school accountability. Interest in early-childhood issues is so keen that 34 states have asked the ECS to conduct workshops on brain-development research.

Early-Childhood Plans

Republican Gov. Terry E. Branstad of Iowa, who chairs the ECS, has proposed a $5.2 million grant program in his state to help local school and health agencies identify at-risk youngsters at birth and coordinate services for them. And, Gov. Mel Carnahan of Missouri, a Democrat, was expected to unveil "a significant early-childhood development package" this week, his spokesman Chris Sifford said.

More than a dozen states will also pursue measures to hold schools more accountable for student performance, typically through state assessments and rewards and penalties based on various performance indicators, according to the NCSL survey.

South Carolina lawmakers plan to consider a system based on school report cards. West Virginia Gov. Cecil H. Underwood, a Republican, is pondering educational audits of schools. And Mr. Wilson wants to appoint a chief inspector of public schools.

But schools will need added resources, such as technology and teacher training, to meet the higher demands, observers say.

"The idea that we have standards-based reform without spending money is unrealistic," argued Brenda Welburn, the executive director of the National Association of State Boards of Education, based in Washington.

Outgoing Gov. George F. Allen of Virginia, a Republican whose term expires this month, agrees. His biennial budget proposal for fiscal 1999 and 2000 calls for $874 million in new K-12 school aid, largely to help pay for the state's new academic standards.

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