Education Funding

Long-Awaited Report on Ohio School Aid Calls for Tax Reform

By Christina A. Samuels — February 15, 2005 3 min read

After 18 months of deliberation, a panel of Ohio educators, lawmakers, and community leaders has released a series of recommendations designed to unravel the state’s tangled school financing laws and make them more equitable.

Ohio, which has 613 school districts, also has a complex school funding formula that has been ruled unconstitutional by the state supreme court four times because the formula relies too much on local property taxes.

In May 2003, however, the court ruled that it was up to the legislature to fix the shortcomings in the current system. (“Ohio Court Declares End to DeRolph School Funding Case,” May 28, 2003.)

In response, Gov. Bob Taft formed the Governor’s Blue Ribbon Task Force on Financing Student Success to study the problem.

The panel, while not unanimous on all its recommendations, does “offer a structure for a new approach that continues the state and local partnership and creates building blocks of funding that provide districts with the flexibility to address their individual needs,” writes the committee chairman, William W. Wilkins, in the introduction to the 60-page report. Mr. Wilkins is also the state tax commissioner.

The report, “Building a Better School Funding System,” is available online from The Governor’s Blue Ribbon Task Force on Financing Student Success. ()

Some observers, including a leader of the one of the state’s teachers’ union, were unimpressed with the report.

They faulted the plan because it fails to seek a complete restructuring of the school aid formula.“It wasn’t a very auspicious start,” said Tom Mooney, a panel member and the president of the Ohio Federation of Teachers, the state affiliate of the American Federation of Teachers.

The 18 recommendations were grouped into three broad categories: providing a reasonable and reliable funding stream for schools; distributing that money fairly among districts; and spending money efficiently and with accountability.

Tax Cap?

A central proposal of the report is to allow property taxes to increase along with property values, up to a predetermined cap. Now, as property values rise, the property-tax rate is rolled back so that homeowners won’t pay more from year to year.

However, because school costs increase from year to year, districts have to go to voters frequently to ask for additional levies to pay for services. This month, there were 64 school levies on the ballot statewide, the most on a February levy date in the past 20 years.

The report suggests that 4 percent cap be placed on property-tax growth so that there would not be large tax increases from year to year.

wilkinsw02162005

But, in order to enact such a policy, Ohio voters would need to approve a change to the state constitution. Gov. Taft signaled during the release of the report that such a change would be difficult.

The governor, a Republican, called the tax-cap proposal a “thoughtful, creative, and constructive solution to a continuing flaw in our current school funding system.”

“It will generate debate and may not be easy to enact. Without enthusiastic, widespread support from the education community, it cannot be accomplished,” he added. “But if that support is forthcoming, I will make its enactment a priority.”

The panel also suggested targeting money toward research-based programs that serve low-income students, and improve academic success for all.

The panel also proposed that districts be audited regularly, and that school boards receive training in ethics, school law, contracts, and student achievement.

The panel recommended that its proposals be adopted as a whole, rather than piecemeal.

Whether the package of recommendations has enough political will behind it to be enacted is an open question.

“Ultimately, that’s going to depend on the department of education and the boards of education to get behind it,” said Mr. Wilkins, the state tax commissioner and the chairman of the committee. “The recommendations that we made are fairly significant, I think, including a modification of the [Ohio] Constitution.”

Others were more cautious.

Mr. Mooney, of the Ohio Federation of Teachers, noted that the governor failed to mention details of the report in his State of the State Address on Feb. 8. The recommendations “fall short of the overhaul that is needed and the overhaul that the state supreme court has ordered,” Mr. Mooney said.

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A version of this article appeared in the February 16, 2005 edition of Education Week as Long-Awaited Report on Ohio School Aid Calls for Tax Reform

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