Capitol Recap

The following offers highlights of the recent legislative sessions. Enrollment figures are based on fall 2002 data reported by state officials for pre-K-12th grade in public elementary and secondary schools. The figures for precollegiate education spending do not include federal flow-through funds, unless noted.

Massachusetts

State K-12 Budget
Holds the Line

Republican

Senate: 34 Democrats 6 Republicans

House: 136 Democrats 23 Republicans

Enrollment: 980,000

Faced with the worst budget challenges in several decades, Massachusetts lawmakers passed and Gov. Mitt Romney signed a bare-bones budget for fiscal 2004. It generally held the line on K-12 spending, even as some popular education grant programs were casualties of the chopping block.

The 2004 budget totaled $22 billion and was signed June 30, one day before the fiscal year began. It was Massachusetts’ first budget in seven years—and only its fourth in 21 years—to be completed on time. The legislature remained in session through the end of last year.

Gov. Romney, who took office a year ago, issued a flurry of vetoes of lawmakers’ spending demands, but members of the legislature were successful in overriding many of them to avoid deeper cuts to programs the governor had targeted.

Among other funding streams lawmakers helped protect from deeper cuts were state grants for kindergarten expansion. The legislature overrode the governor’s $10 million reduction in that program. Meanwhile, the main source of state funding for local education, known as Chapter 70, fell slightly, from $3.2 billion in fiscal 2003 to $3.1 billion in fiscal 2004.

“Although many districts are receiving less state aid than in FY 2003, sufficient aid has been provided to ensure that every district remains at or above its foundation budget target,” according to a budget analysis from the state department of education.

Categorical grants to districts that saw significant reductions included money to help students prepare for the Massachusetts Comprehensive Assessment System exams. All students in the state must pass the MCAS exams in mathematics and English in order to graduate from high school. Money for remedial help was slashed from $50 million in fiscal 2003 to $10 million in this current fiscal year.

In other closely watched education news, judicial consideration of a school funding lawsuit began last June in Suffolk County Superior Court in Boston. Plaintiffs in Hancock v. Driscoll argue the state has failed to meet its obligation under the state constitution to provide a basic standard of education. Plaintiffs in the case include students who attend 19 Massachusetts school districts.

—John Gehring

Michigan

State Fiscal Woes
Erode School Aid

Faced with revenue shortfalls all last year, Michigan lawmakers have hacked away at education spending.

Following the most recent of three rounds of cuts, school districts will see a roughly 1.5 percent reduction in their basic aid from the state. For instance, a district receiving the minimum grant of $6,700 per pupil would get $92 less.

Overall, the fiscal 2004 education budget that took effect Oct. 1 now stands at $12.4 billion, about a 1 percent reduction from the previous year’s spending of $12.5 billion.

A compromise agreement in December between Gov. Jennifer Granholm, a Democrat elected in 2002, and the Republican-controlled legislature halved her proposed basic-aid cut and saved some of the state’s safety-net spending. Legislators went along with Gov. Granholm’s proposal to postpone for six months an income- tax rollback scheduled for this month, and the governor agreed to slice in half the tax that businesses pay on health benefits they provide to employees.

This year’s budget has been “mainly a story of making the most of what we’ve got,” said Mathew A. Resch, the press secretary for Speaker of the House Rick Johnson. “We’re hopeful it’s the only cut needed for the rest of the 2004 fiscal year.”

Left intact were the state’s merit scholarships, awarded to high school graduates enrolling in higher education programs on the basis of their scores on state tests. Ms. Granholm had wanted to slash the awards from $2,500 to $500 each.

A $22 million plan to buy laptop computers for every 6th grader also foundered on financial shoals.

An accord to lift the current cap on the number of university-approved charter schools and allow up to 150 more of the independent public schools fell apart in September, soon after Gov. Granholm and Republican legislative leaders reached it. (“Detroit May Get More Charter Schools, Backers Say,” Oct. 15, 2003.)

—Bess Keller

New York

Lawmakers, Governor
Spar Over K-12 Spending

New York state’s education budget for fiscal 2004 took a $200 million cut in last year’s legislative session, but for educators that was better than the alternative.

Gov. George E. Pataki had recommended a $1.2 billion cut in state aid, which in the 2002-03 school year was $14.9 billion. The Republican governor vetoed 120 line items—27 of them for programs in the state education department—in the legislature’s budget because they totaled $1 billion more than he had requested for education and raised income taxes to pay for them.

But the legislature overrode all but one of those vetoes to ensure that spending came close to the prior year’s levels. Previously, the legislature had only once enacted a law over the governor’s objections. In the end, the K-12 budget for fiscal 2004 is $14.7 billion, which is a 1.3 percent decrease over the previous fiscal year.

“The legislature acted heroically and historically on behalf of education,” said Douglas E. Gerhardt, the legislative counsel for the New York State Council of School Superintendents. “But we still saw a $200 million decrease in state aid.”

To compensate for the reductions in state spending, some school districts were forced to raise property taxes by more than 10 percent, Mr. Gerhardt added.

The budget battle consumed much of the spring and summer, but legislative action continued through the fall. As of late last week, Mr. Pataki still had bills on his desk awaiting his signature. None of them would dramatically change education policy.

Few legislative actions outside the budget will have a big impact on schools, according to education groups in the state.

One new law will require districts to contribute 4.5 percent of their payrolls to the state’s pension plans for teachers and other municipal employees. Without the legislation, some districts would have been required to pitch in 12 percent or more of their salary costs this year to compensate for the funds’ recent stock market losses, according to David L. Ernst, a spokesman for the New York School Boards Association.

The new contribution levels will continue during years of stock market rises, according to Mr. Ernst. During past booms, districts didn’t need to put money into the funds because the funds’ increase in value covered the amount needed to pay retirees.

In addition, the legislature lifted the cap on salaries for superintendents of the state’s regional education service providers. Under previous law, those superintendents could not earn more than the state commissioner of education, whose salary hasn’t increased in 10 years, Mr. Gerhardt said.

The new law allows the regional superintendents to receive annual raises of 5 percent for the next five years.

—David J. Hoff

Ohio

Schools on a Path
To Higher Spending

Ohio lawmakers weren’t ready to gamble on raising additional money for college scholarships and school buildings by bringing slot machines to the state’s horse tracks before the session ended for the holidays last month.

The controversial proposal pitted legislators who wanted to apply slot-machine revenue to tax relief against those who wanted such dollars to be dedicated to education. The legislature needed to act on the bill to get the plan before voters on the March ballot.

But funding for primary and secondary education will increase by nearly 5 percent over the course of the 2004 and 2005 fiscal years. The pre-K-12 budget will reach $7.3 billion in 2005, compared with $6.9 billion in 2003—an increase of nearly 6 percent. Per-pupil funding will climb from $4,949 in 2003 to $5,169 in 2005.

Still, faced with a $162 million deficit for fiscal 2003 out of a total state budget of $20.4 billion, Gov. Bob Taft used an executive order to decrease education spending by almost $100 million last year. Roughly $91 million of that funding came from basic and parity aid to schools. Lawmakers also increased the state sales tax by 1 cent, to 6 cents, to generate about $1.3 billion in additional revenue annually.

Following lengthy legal struggles over school aid, possible changes to the way Ohio pays for precollegiate education are now in the hands of the new Blue Ribbon Task Force on Financing Student Success. The panel’s recommendations will be considered for the 2005 fiscal year.

A new law gives the Ohio Department of Education the power to certify charter school sponsors, while it withdraws the state board of education’s authorization to serve as a sponsor. The measure also allows the Buckeye State’s 13 public colleges and universities, as well as educationally oriented nonprofit groups, to become charter school sponsors.

—Karla Scoon Reid

Pennsylvania

Eight-Month Impasse
Ends With New Budget

Pennsylvania’s legislative year was dominated by a standoff over education spending, making the Keystone State the last in the country to complete its budget for fiscal 2004. The final spending plan, signed by the governor Dec. 23, delivers a modest increase in school spending.

The $7.3 billion precollegiate budget includes $278 million more on education than the state spent the previous year, a 4 percent increase. Gov. Edward G. Rendell, who took the state’s helm last year, had originally sought $650 million in new spending.

The budget deal means basic education subsidies will start flowing again to the state’s 501 school districts. The Democratic governor vetoed the 2003-04 subsidy last March as leverage against the Republican-dominated legislature, which had adopted a bare-bones, $21 billion budget and rebuffed his education agenda. (“Pennsylvania Enters Round 2 of Budget Battle,” April 2, 2003.) Mr. Rendell’s veto meant that districts never got their two fall payments. A handful of districts that depend most heavily on state aid were forced to borrow money to stay afloat. The new budget will reimburse them for those missed payments, and repay interest or penalties they incurred.

Pennsylvania’s school spending plan includes $175 million in block grants that districts can use beginning in 2004- 05 for state-approved plans to improve student achievement, including smaller classes and full-day kindergarten.

Another $49 million will be used for early-childhood programs, and $34 million will provide tutoring for children who scored poorly on math or reading tests.

The school spending plan will be financed largely by an increase of almost 10 percent in the state’s personal- income tax, the first such hike since 1991. That increase will generate $729 million a year.

Gov. Rendell had proposed legalizing slot machines at racetracks to help pay for his school programs and facilitate a cut in Pennsylvania’s high property taxes. But lawmakers could not agree on gambling or on a property-tax reduction; those issues remain to be tackled this year.

—Catherine Gewertz

Wisconsin

State Backs Off
Its Share of Funding

Facing an austere fiscal climate, Wisconsin legislators reneged on a 1993 promise to provide school districts with two-thirds of total funding. They changed the law so that the state is now required to provide between 60 percent and 65 percent of districts’ budgets.

The two-thirds commitment had been put in place, in part, to provide property-tax relief.

Nonetheless, the state will increase spending on the education department by $189 million during the two-year budget cycle covering the 2004 and 2005 fiscal years, part of a $9.6 K-12 billion biennial budget, said a state policy analyst. Total spending on education was increased from $9.3 billion in the previous biennium.

Per-pupil spending will increase by 1.2 percent the 2003- 04 school year, to $236. “We didn’t get the amount we were accustomed to seeing, ... but we were the only state-funded entity that got more money,” said Ken Cole, the executive director of the Wisconsin Association of School Boards. For that reason, no one in the education community is complaining too loudly, he said.

First-year Democratic Gov. James E. Doyle worked to protect a popular class-size-reduction initiative, the Student Achievement Guarantee in Education Program, or SAGE. Established in 1996, the program in part ensures a student-to-teacher ratio of 15-to-1 in grades K-3. Many lawmakers had wanted to make the program optional for some schools in an attempt to reduce costs.

Gov. Doyle also restored funding for the state’s kindergarten program for 4-year-olds, an initiative that supporters say would have been gutted without his advocacy.

Over the summer, the governor vetoed a plan to freeze property taxes, a measure that some educators had argued would devastate school districts already contending with significantly fewer state dollars.

—Julie Blair