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Published in Print: February 25, 2004, as Reporter's Notebook

Reporter's Notebook

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School Aid Challenges at Heart Of Conference for State Lawmakers

State leaders are eager to find solutions to lawsuits claiming that K-12 funding is inadequate.

With half of states either fighting such a lawsuit or seeking a court-ordered remedy to one, legislators and other state officials brought their search for answers to the National Conference of State Legislatures' annual school finance seminar, held here Feb. 13-15.

Arkansas legislators told the audience about their new school financing law and reviewed several ingredients that they hope will keep the state out of court for the first time in 20 years.

The day before the conference began, Arkansas Gov. Mick Huckabee signed a measure that will pump $400 million into elementary and secondary education—a 13 percent increase over current funding in the state's current two-year budget. Legislators crafted the law in response to a 2002 state supreme court decision declaring school funding in the state inequitable and inadequate.

Sen. Dave Bisbee

Arkansas' legislative solution protects the state from future lawsuits because it puts enough money into schools and includes safeguards to ensure the state continues to pay for schools at an adequate level, according to state Sen. Dave Bisbee. The Republican chairs the legislative task force that addresses educational adequacy.

Legislators raised the $400 million to pay for the K-12 increase by hiking the state sales tax and instituting a mix of taxes on services and corporations.

While that amount is about half of what a panel of school finance experts suggested Arkansas needs to spend to adequately finance its schools, legislators have gathered enough evidence to refute their assumptions, Mr. Bisbee told a session on the conference's first day. "We can show clearly the rationale and the reasoning" for scaling back the experts' recommendations, Mr. Bisbee said.

To ensure such spending levels continue in the future, a new Arkansas legislative panel will review state spending and schools' needs before the legislature convenes in its biennial session next year. The panel will recommend how much the state needs to pay for K-12 education in order to meet the state high court's Dec. 2002 decision declaring state spending inadequate.

"Adequacy is so fluid you have to review it," Mr. Bisbee said. "We'll have an ongoing revision of what is adequate so we don't get behind the courts."

Once the legislature sets that spending level, it won't change. A clause in the spending bill will protect K- 12 spending from cuts during the middle of the state's two-year budget cycle. If revenues are below projections, the governor is required to cut other state agencies instead.

"Education will get 100 percent funding," said Mr. Bisbee, who also chairs of the legislature's joint budget committee. "They have no choice. They have to take it from other agencies."

Even the legislators' procrastination will work in their favor, he maintained. After the Arkansas legislators missed the court's Dec. 31 deadline to adequately finance the state's schools, the court appointed a "special master" to oversee the legislature's work.

"We're the only state in the nation where the court is going to have to have buy-in," Mr. Bisbee said.

The special master, who has not yet been appointed, is going to either have to say: "'Yes, you are constitutional,' or 'No you're not constitutional' and then we can fix it," Mr. Bisbee said.

While state legislators face the long-term questions of how to finance schools adequately, they say they're also struggling to pay for tasks required by the federal No Child Left Behind Act.

When a supporter of the law outlined research during the NCSL conference that suggested that states would have federal funds left over after meeting all of the law's requirements, the lawmakers here appeared skeptical.

According to a study conducted by a Washington policy group, states would be able to pay for the law's requirements over its seven-year life with federal money and still have $5 billion in federal grants left over.

AccountabilityWorks, which produced the study for the Education Leaders Council, used cautious assumptions when estimating how much it would cost states to meet federal requirements for hiring highly qualified teachers, developing tests, and providing school choice to students in low-performing schools, explained Theodor Rebarber, the president of the research group. But legislators in the audience questioned Mr. Rebarber's work. For example, the report says states could spend half of their grants from the federal Individuals with Disabilities Education Act to pay for services under the No Child Left Behind law, a reauthorization of the Elementary and Secondary Education Act.

"We're using all that IDEA money just to keep up with the cost of special education," Minnesota Sen. Steve Kelly told Mr. Rebarber in the session. If the study left out special education funding from the total available to states, the surplus federal money would probably disappear, Mr. Kelly said in an interview after the session.

Mr. Rebarber defended the report, saying that the No Child Left Behind law and the IDEA share the common goal of improving student achievement.

"We think it's legitimate to include [special education money] because the purposes [of the two laws] overlap," he said in response to Mr. Kelly.

—David J. Hoff

Vol. 23, Issue 24, Page 23

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