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Published in Print: January 7, 2004, as News in Brief: A State Capitals Roundup

News in Brief: A State Capitals Roundup

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Schwarzenegger Wins: Bond Plan to Get Vote

California voters will decide in March whether the state should authorize a $15 billion bond to help manage its fiscal crisis. Gov. Arnold Schwarzenegger readily signed the bond-vote measure on Dec. 12, shortly after it was approved by the legislature.

Gov. Arnold Schwarzenegger

The Republican governor also declared a "fiscal emergency" in the state, and made emergency cuts in some programs to redirect money to local governments. Most of that money will go to help pay for local police and fire departments, although some could be directed to education. Some of the emergency cuts came from the higher education budget.

The state, with an annual budget of about $99 billion, has faced unprecedented budget deficits—reaching as high as $38 billion—in the past two years. Gov. Schwarzenegger, who inherited responsibility for the fiscal mess when he took office Nov. 17, said the bond measure would "prevent our state from ever facing such a disastrous situation again."

Meanwhile, two Wall Street agencies lowered the state's bond rating last month, placing it just above junk-bond status, which translates to a high risk for investors.

—Joetta L. Sack

Missouri High Court Upholds Governor's Move to Retain Aid

The Missouri Supreme Court has ruled that Gov. Bob Holden has the power to withhold public school funding in order to balance the state budget.

Gov. Holden ordered that $190 million be withheld from public schools in May, when he learned there would be a $300 million gap in expected revenue in the state's $19.1 billion budget for fiscal 2004.

Three Kansas City-area districts—Liberty, Lee's Summit, and Fort Osage—filed a lawsuit last August contending that the state constitution protects education funding from such a cut.

Mr. Holden, a Democrat, said he blamed the Republican-controlled legislature for any school funding problems.

"I would prefer that the General Assembly adequately fund education so that the state does not have to defend lawsuits," the governor said in a statement Dec. 9, after the court's opinion was released. "This is only the beginning of the litigation war that will ensue if the legislature does not accept its responsibility to provide adequate funding for our schools."

—Lisa Goldstein

Oregon Foundations Seek To Find School Aid Solution

Five influential foundations in Oregon have teamed up to help solve the state's education funding crisis.

Calling their initiative the Chalkboard Project, the groups will seek the advice of school funding experts from across the country and ask Oregonians through town hall meetings and Web discussions on how to pay for schools.

The groups participating are the Portland-based Meyer Memorial Trust, Oregon Community Foundation, and Collins Foundation; the Klamath Falls-based Jeld-Wen Foundation; and the Ford Family Foundation, in Roseburg.

Earlier in 2003, the groups created Foundations for a Better Oregon to solve some of the state's most pressing challenges. K-12 funding is the first, said Doug Stamm, the executive director of the Meyer Memorial Trust.

"We feel that our kids are being shortchanged. There is no strong leadership on this issue," he said. "There is a general consensus that [school funding] haunts the state as one of its top issues."

The groups hope to have an economic plan before the legislature within two to three years, Mr. Stamm added.

State public school funding has fluctuated in recent years, in part because of Oregon's economic downturn. A statewide cap on local property tax rates has also made it harder to raise new aid. Last school year, more than 100 school districts closed early to make up for cuts in state funding. Many others also laid off employees and cut academic programs.

—Rhea R. Borja

Arizona Finds Good News In Latest Dropout Data

Arizona state schools Superintendent Tom Horne announced a "happy surprise" last month: a high school graduation rate that exceeds the national average.

The finding is a highlighted result of a recently completed study by the state education department, which examined the status of students who entered 9th grade in 1998-99 and graduated in 2002. During that period, 76.4 percent of students received a high school diploma, with nearly 73 percent accomplishing the task within four years. That compares favorably, Mr. Horne said, with a national four-year graduation rate of 67.3 percent.

The Arizona schools chief contends that prior national comparative studies of state dropout rates have been inconsistent. For example, Arizona in the past counted students who received General Educational Development credentials as dropouts, while other states did not. The state education department's new study "compares apples with apples, and shows Arizona doing better than the national average," Mr. Horne said in a Dec. 18 statement.

Still, the state study also showed that 1 in 4 Arizona students in the class of 2002 didn't receive a diploma. And a 2003 study by the Arizona Minority Policy Analysis Center reported that although Arizona's total dropout rate decreased between 1999 and 2002, the rate for minority students, 13.1 percent, was still more than double that of the 6.4 percent rate for white students.

—Darcia Harris Bowman

Kentucky Court Rejects 'No Pass, No Drive' Law

The Kentucky Supreme Court has ruled that a 1994 state law denying or revoking teenagers' drivers' licenses if they drop out or fail in school is unconstitutional.

In a 4-3 decision released Dec. 18, the high court said that the "no pass, no drive" law discriminated against students with disabilities and violated students' rights under the 14th Amendment of the U.S. Constitution.

The law, adopted voluntarily by all but 40 of the state's 176 districts, applied to 16- and 17-year-olds in school districts with alternative education programs for students to help students who fall behind academically. It did not apply to teenagers who lived in districts without such programs.

Since 2001, the state has denied or revoked the licenses of 8,500 teenagers under the law, according to Gail Tucker, a spokeswoman of the Kentucky Transportation Cabinet.

The original plaintiff in the class action, who is identified as M.F. in court documents, has a learning disability but was enrolled in the regular academic program of Calloway County High School in Murray, Ky. "M.F., despite her best efforts, was declared academically deficient and, as a result, lost her driver's license," the high court decision says.

—Mary Ann Zehr

Florida Voucher Management Blasted in State Audit Report

Oversight of Florida's school choice programs came under fire in recent audit reports released by Tom Gallagher, the state's chief financial officer and a former state education commissioner.

The Dec. 11 reports found lax administration of Florida's voucher programs, which allow some 13,000 public school students to use state money for private and religious school tuition, plus about 16,000 corporate scholarships that involve indirect subsidies via tax breaks.

The audit contended that "critical controls" were not present to guard against abuse, and that a lack of written administrative rules and turnover in management of the programs had led to recent scandals. ("No More Vouchers for Florida Islamic School," Aug. 6, 2003).

F. Philip Handy, the state education board chairman appointed by Gov. Jeb Bush, wrote in a Dec. 23 letter to Mr. Gallagher that the audits did not reflect new management of the school choice programs, nor did they acknowledge that many problems mentioned in the audit have been addressed. He strongly opposed language in the audits that linked the state's lack of oversight with alleged criminal activity in one school that had received state scholarship money.

—Alan Richard

Vol. 23, Issue 16, Page 22

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