Recruitment & Retention

To Pay Teachers More, S.D. May Revamp its Entire School Funding System

By Stephen Sawchuk — February 03, 2016 3 min read
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Following up on a State of the State address in which teacher pay was a major theme, South Dakota Gov. Dennis Daugaard has unveiled a series of legislative proposals that would tie school funding to teacher salaries—a shift that would move the state’s overall funding mechanism away from a traditional per-pupil approach.

The main proposal would increase the sales tax by half a cent, as well as increasing other smaller taxes (an excise tax, a use tax, and an amusement tax). The funds would be sent to districts largely based on formula calculated off of a target average teacher salary, which would be keyed to a teacher-student ratio rather than per-pupil expenditures, as is the case in most states.

Here’s how it would work. The state’s target average teacher salary would begin at of $48,500, and the funding formula assumes a district would have a teacher-to-student ratio ranging from 12.5 to 1, to 15 to 1 based on district size. Depending on whether districts were able to maintain those ratios, actual teacher salaries could differ somewhat. For example, if a district decided to hire more teachers than under that ratio, they might have to pay their teachers less overall.

So let’s say you were a district with 700 students. Under the 15-to-1 staffing formula, you’d get enough cash to pay for about 47 teachers at the average salary of $48,500. (On top of that, the formula kicks in more for teacher benefits and overhead.)

Districts could also supplement teacher salaries in other ways.

In his address, Daugaard said that the system would not only help leverage higher salaries and improve recruiting, but increase accountability for how how schools are staffed. “This transparent formula will lead to more informed conversations among school leaders, teachers, parents, and taxpayers about local spending and staffing decisions. It will lead to greater accountability at the local level for decisions that impact teacher salaries,” he said.

In addition, he argued, the proposal would help equalize funding because both property taxes and other levies that vary from district to district would be accounted for in the calculation of local spending, before the state formula kicks in.

In all, the proposals aim to raise some $100 million in education funding. Of that, most of it would be put into salaries, while some $40 million of the funding would be used to reduce property taxes that currently fund general education.

South Dakota’s current average teacher salary is about $40,000—far lower than its neighbors, and reportedly the lowest in the United States.

So far, the Argus Leader reports, the proposal seems to have the backing of the state teachers’ union, and a survey commissioned by Daugaard shows that voters approve it. .

Lawmakers, on the other hand, have said that it could be challenging to push through a tax increase. And it’s also unclear whether the ratios could be harder for the smallest or most rural districts to meet.

Daugaard also proposed additional efforts to recruit and retain teachers, including:


  • Beefing up a mentoring program so that novice teachers got two years of assistance from a mentor, plus summer training;
  • Requiring the state to issue rules on how to grant licenses to teachers from other states; and
  • Expanding a state e-learning center offering courses that districts can use to help meet staffing demand in high-need disciplines.

Photo: South Dakota Gov. Dennis Daugaard gives his budget address at the state Capitol in Pierre, S.D., in December. —James Nord/AP-File

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A version of this news article first appeared in the Teacher Beat blog.


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