Indiana Governor’s K-12 Budget Includes Performance Funding

By Andrew Ujifusa — January 17, 2013 2 min read
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Indiana Gov. Mike Pence, a Republican elected on Nov. 6, has proposed in his two-year 2013-15 state budget that K-12 spending increase by 1 percent in each of the next two years, but that in 2014-15, that K-12 increase would be “performance-based” for both “outstanding schools and teachers.”

Earlier this month, I wrote about big K-12 education issues for legislatures and governors in 2013, and one of the big ideas that could gain traction this year is performance funding. This new momentum for rewarding success, or at least some officials’ definition of success, is due to lawmakers disappointment with a cycle of public school investments that don’t correspond to better results in higher education and, even more crucially, their states’ economies, as Richard Laine, the National Governors Association education division director, discussed with me.

Back to Pence, who used to represent the Hoosier State in the U.S. House of Representatives. The 1 percent increase in funding for public schools in both fiscal 2014 and fiscal 2015 in Indiana, the Indianapolis Star reported, would amount to $63 million and $64 million, respectively. But here’s the key passage from the introduction to Pence’s budget: “We recommend the 1 percent increase in the second year (FY 2015) be performance-based, using factors such as school quality, graduation rate, and third-grade reading assessment. We intend to fund excellence through performance-based awards to Indiana’s outstanding schools and teachers. We also increase teacher excellence grants by $6 million in order to increase pay for our high-performing teachers.”

This would obviously be a departure from the standard per-pupil funding method in Indiana, and elsewhere. Politically, there’s a positive note to this, in the sense that the state would be rewarding successful teachers, and not punishing ones they deem average or unsuccessful. But of course, schools that hope for and say they need steady funding increases won’t be happy if this supposed funding “increase” doesn’t reach them. It might also turn out that only a small fraction of teachers and schools would receive them, leaving the majority of Indiana’s public schools and public school teachers with lighter wallets and purses.

As the Star notes, the increase doesn’t make up for the $300 million hit schools took in state funding in 2009 with then-Gov. Mitch Daniels’ budget. Pence’s budget estimates $518 million in surplus revenue for fiscal 2014, and $759 million in fiscal 2015, but also cuts the state income tax rate by 10 percent. Educators and K-12 funding advocates might not like the combination of those two items, seeing a possible opening for further K-12 funding increases disappear. (Indiana reported a $2 billion reserve fund and a $500 million surplus at the end of fiscal 2012.)

Districts, teachers’ unions, and others, in Indiana and elsewhere, might chafe as state budget outlooks continue to improve, only to be told that access to extra levels of funding will require particularly strong statistical performances. But several other governors could follow Pence’s lead in the coming weeks.

A version of this news article first appeared in the State EdWatch blog.