Education issues and the 2015 General Assembly

Season’s greetings! I hope that readers of this blog will take time over the next couple of weeks to relax and spend time with family and friends. The holiday season is an excellent time to recharge your batteries.  I plan to do just that, so this will be my last blog for 2014, but will return to the keyboard for a January 9, 2015 entry.

As we look forward to the New Year, the Kentucky Department of Education (KDE) is preparing for a busy legislative session. Here are some of the hot topics we predict will be on the education agenda for the upcoming General Assembly.

     1)  Charter Schools – we will again see legislation to create charter "
     schools in Kentucky. Our state is one of only eight states without
     charters. I am hearing about the possibility of a small pilot of
     five to six charter schools in districts that have very low-performing
     schools with significant achievement gaps.

     2)  Teacher Pension Plan – the Kentucky Teacher Retirement System
     has asked the General Assembly to consider a plan that would require
     a $3.3 billion bond to shore up the underfunded retirement system.
     This system is critical for recruitment and retention of high-quality
     teachers.

     3)  School Funding – while 2015 is not a budget session, there are
     a number of funding issues that could surface. The Council for
     Better Education report recently released at the Kentucky
     Association of School Superintendents’ winter meeting will garner
     a lot of attention. The $2 billion-plus price tag is sure to get attention. |
     Also, KDE will be releasing a report on funding of the career and
     technical education programs in Kentucky. Finally, we may see
     discussion of impact of revenue shortfall and SEEK shortfall.

     4)  Dual Credit – a recent set of recommendations from the dual
     credit task force will generate discussion about how to ensure
     quality, access, funding, and transferability of courses.

     5)  Merging County Systems – several county school systems
     have been identified for state assistance and state management.
     Some county systems are very close to not having a 2 percent
     fund balance. The General Assembly previously enacted legislation
     that allowed a financially insolvent independent district to merge
     with a county system; however, currently there are no statutes that
     allow for the merger of an insolvent county system to merge with
     another system.

     6)  Closing Achievement Gaps – this issue will be part of the
     charter school issue but will also be an overarching theme of the
     Education Committees. The achievement gap in Kentucky begins
     before students enter kindergarten, continues throughout P-12,
     postsecondary, and is very obvious when we look at labor and salary
     studies for adults.

At the national level, KDE will be working to support reauthorization of the Elementary and Secondary Education Act (ESEA) – most recently dubbed the No Child Left Behind Act – and the Carl Perkins Act which is the primary vehicle for federal funding of career and technical education. We are very excited about the potential of both bills moving forward very quickly under the leadership of Sen. Alexander of Tennessee and Majority Leader McConnell.

A Perfect Storm is Brewing

In 1990, the Kentucky General Assembly took bold action to reform P-12 education. Through passage of the Kentucky Education Reform Act (KERA), the General Assembly agreed to invest in education and to implement numerous policies and actions that would raise student achievement. At the time, Kentucky was one of the bottom two or three performers among states.

Fast forward 23 years, and we now see Kentucky at or above national average on many measures of student achievement. KERA worked due to the bold vision of the General Assembly and the tremendous work of Kentucky educators.

In 2009, the Kentucky General Assembly again took bold action to reform P-12 education. With the passage of Senate Bill 1, the General Assembly pushed P-12 education toward a higher goal of college- and career-readiness for all students. While KERA had focused on basic academic performance, Senate Bill 1 now focused on college/career-readiness and national/international competitiveness of our Kentucky graduates. Senate Bill 1 has worked as evidenced by increased college/career-readiness rates and graduation rates.

With KERA, there was a significant investment in funds. Programs like Extended School Services, preschool, professional development, teacher salaries, school-based decision making councils, Family and Youth Resource Service Centers, textbooks, and technology received significant dollars through the state budget.

With the passage of Senate Bill 1, there were no additional dollars provided for standards development, assessments, accountability, professional development, textbooks, technology, or student support services. The clear message from the General Assembly was educators had the funding they needed in existing budgets. However, no one dreamed that throughout the next four years the General Assembly would have to greatly reduce funding for public education due to the recession.

Basically, the General Assembly has not been able to honor the commitments made through KERA or Senate Bill 1 due to the recession and lack of economic recovery. How deep have the cuts to education been?

Since the 2008 session of the General Assembly, the per pupil amount has dropped by $33. In FY 2009, the General Assembly provided $2,461,236,248 for basic SEEK funding; the amount in FY 2013 was $2,397,016,693. The General Assembly has allocated $64,219,555 less during a time that our Average Daily Attendance has increased by more than 10,000 students.

KERA provided Flexible Focus Funding for professional development, preschool, textbooks, safe schools, and extended school services. Since the passage of Senate Bill 1 in 2009, funding for professional development has been reduced by more than $9 million, safe schools have been reduced by more than $6 million, extended school services have been reduced by more than $19 million, textbooks have been reduced by more than $21 million, and preschool has been reduced by $3.8 million. In FY 2008, Flex Focus Funds totaled $154,099,600; in FY 2013, it was $93,143,900 -- a total reduction of $60,955,700.

KERA also established a strong focus on technology. In the last four years, we have seen a reduction in excess of $8 million in basic support for the technology infrastructure and the loss of a $50 million bond that helped districts purchase technology equipment.

The impact on education has been significant. In the last three years, we have lost more than 1,800 teachers due to budget cuts.

Local school districts have had to rely on local property taxes to offset some of the state cuts. In FY 2009, local support for education totaled $825,184,656. In 2013, the amount had increased to $872,904,155. This was an increase of $47,719,499 from local sources which rely heavily on property taxes. The net result is that the state is pushing more of the cost of public education on to local property owners. This means that we are seeing a growing gap in equity of funding between school districts. The gap between the school district with the highest funding per pupil and the school district with the lowest funding per pupil in FY 2009 was $8,719. By FY 2013, the disparity had increased to $11,338. This means that the highest funding school district has on average more than $250,000 per classroom to provide a high quality education.

The significant reduction in state funds is only one part of the perfect storm that is brewing. In the spring of 2014, our school districts will have to deal with the budget cuts from federal sequestration – an estimated $57 million in cuts to programs like Title I, special needs students, migrant students, and other at-risk student populations. Estimates of the loss in positions are around 1,300.

Finally, our school districts will see the other part of the perfect storm as they budget for 2014-15. The Kentucky School Board Insurance Trust settlement will happen in the next few months and will place another $50-60 million cost on our districts. Districts will have to borrow money to pay these assessments. To repay the loans, districts will have to take money out of their operating funds that normally would be used to hire staff and provide support services for students.

The perfect storm is certainly brewing in Kentucky education. The only possibility for our school districts is to seek restoration of state funds since we see little hope coming from the federal level of any type of resolution to federal budget and sequestration cuts.

Educators and parents all across Kentucky have come to together to focus on restoration of education funds during the 2014 General Assembly. Failure to see funds restored will result in significant layoffs for the 2014-15 school year. Parents will see the impact in larger class sizes and less support for children who are struggling. Kentucky will see declining graduation rates, higher dropout rates, fewer children reaching college- and career-ready requirements, and negative impacts on social, health, and juvenile justice programs. I hope readers will let their voices be heard.

Interesting Times in Frankfort

The final days of a “short session” are always interesting. This year is no exception. I informed superintendents via e-mail yesterday about the Senate budget language that would reduce education funding. Over numerous months and in many meetings, I have alerted educators to the Medicaid issue that would eventually have to be reconciled and its impact on P-12 education funding. (See earlier blog postings “Budget Facts and Effects,” “Budget Should Reflect the Needs of Children,” “The New Normal” and “Kentucky’s Moral, Economic and Civic Obligation.”)

Also, I have alerted educators on numerous occasions about the “funding cliff” that is approaching in 2012. I thought readers might be interested in the background about the budget process, and I found an excellent summary of events in the KEA Advocate. With permission from KEA, here are some highlights from the article.

Events
About 7:15 on Wednesday evening, the state Senate voted to cut school funding for the 2011-12 school year. The bill also removes class size limits, eliminates the requirement for kindergarten aides, and removes the requirement for preschool teachers to be certified.

The bill - HB 305 SCS - now goes back to the House to concur or not concur in the changes the Senate made to the bill. This bill will likely go to a conference committee of the two chambers.

Background
Because of less federal support than expected, Kentucky's Medicaid funding faces a significant shortfall. Governor Beshear proposed, and the House agreed, to a "fix" for this issue that did not require cuts in school funding. The House passed its bill - HB 305 - on Feb. 10, the 12th legislative day of this 30-day short session.

HB 305 sat in the Senate for more than two weeks with no action. Then on Tuesday, the 24th day of the session, after the Senate had already adjourned for the day, the Senate Appropriations and Revenue Committee adopted a substitute version of the bill that contains significant cuts in school funding.

About 24 hours after the bill passed Senate A&R, the entire Senate passed the Senate Committee Substitute (SCS) to HB 305.

Proposed Cuts
HB 305 SCS, as adopted by the Senate, contains these cuts in school funding:
SEEK: reductions of $38.6 million. When these cuts are added to the anticipated shortfall we already knew about, the total is $67.3 million for next school year, about a 2.3% cut.
NON-SEEK: other reductions in education funding amount to $9.4 million.

What Happens Next
On Thursday (3/3), HB 305 SCS will be returned to the House of Representatives. The first vote to occur will be whether or not to concur with the Senate's changes in the bill. If the House does not concur, it will inform the Senate. Then each chamber may appoint a joint conference committee to try to work out the differences. House and Senate leadership each appoint members of the conference committee. This process will probably take most of the day Thursday.

Next, the conference committee will meet and try to negotiate a compromise that both chambers can pass. If the committee is a "free" conference committee, other bills can be added to the committee's recommendations so literally, anything can happen. Making this situation more difficult is the legislative calendar. The General Assembly is scheduled to recess after its session on Monday, March 7. They will then reconvene on March 21 and 22 and then adjourn. All this means there is very little time for the General Assembly to consider and act on this crucial issue.

As commissioner, I am extremely concerned about any cuts to public education; however, I also know that the budget situation is extremely complex, given the Medicaid situation. I also realize that the situation was made even more complicated by the unexpected increase in students that resulted in a $28 million shortfall for the Support Education Excellence in Kentucky (SEEK) funding in 2012.

I am also concerned about the impact of budget cuts on our children’s future. We are in the middle of major education reform with 2009’s Senate Bill1 implementation. This reform focuses on improving the college and career readiness of Kentucky students. This reform will mean an improved economy for Kentucky and improved futures for Kentucky children. Budget cuts will have a significant impact on our ability to deliver on the promise of this reform legislation.

I hope that the budget conferees will consider the future of Kentucky’s children as they make difficult decisions in the next few days.