| Mr. Schmidt began with a discussion of the manner in which Philadelphia
School District gets taxes from its residents. Mr. Schmidt was asked by Judge Pellegrini
on other days to get an explanation of the tax effort of the city in municipal overburden
terms. Mr. Schmidt pointed out that in the Commonwealth Court decision in the PHRC case,
Judge Smith had elaborated on the manner in which the city does taxation for the school
district. There will be a joint stipulation about this subject. Dr. Salmon was recalled
to the stand as a rebuttal witness for the Plaintiffs. His testimony was about the
following things:
The reason why you would sort wealth on a per pupil basis rather than on a per capita
basis ( what if one district had 1000 students and the other 100, even if the population
was the same , this could happen in districts where there are many parochial or private
school students or many retired folks, therefore using per capital wealth would not work.)
The measure of description is the school district and its children, that is not per
capita, the Department of Education does not use per capita in any of its calculations.
Using total expenditures (there was discussion of that), does not take into account the
wild swings of expenditures related to debt service or capital expenditures which make it
much larger in one year and smaller the next. It is appropriate to use instructional
expenditures, which take out capital and federal expenses, as well as some others not
directly related to instruction.
In looking at the expenditures per capita divided into deciles, why would you just say
that the first five deciles are flat ( if they really are) and then say that the last
three deciles, which represent 100's of thousands of children should not be looked at with
relation to wealth. Are they not part of the Commonwealth of PA?
There are strategic choices that you made with any model at the beginning of a
statistical analysis and that does affect the outcome.
It is difficult for Dr. Salmon to understand how you would use a cost of living index
that was related to State Metropolitan Statistical Areas and lump in rural areas and
suburban areas in that delineation. That is not what that statistic is meant to do. It
cannot tell you what the cost of living differences are among school districts in the
state.
The Lorenz Curve depicted in Dr. Fairley's work does actually show variations in the
state among the districts. The dispersions on the Lorenz Curve make us the 6th most
disparate state in the nation. The reason why it is at all congruent is the massive tax
effort by the local districts and the money given by the state.
Judge Pellegrini asked if all the charts look the same why is there an argument about
the outcomes. Dr. Salmon said that the correlation of wealth to spending is a .60 on Dr.
Fairley's work and above that in Dr. Alexander's work. The charts do not tell the entire
story, they are just depictions. The numbers actually tell the story. The charts are
always approximations
.60 is a significant correlation.
Under cross examination Dr. Salmon was asked whether you arrange the deciles by per
capita wealth or wealth per student do you not get the same results. Dr. Salmon said yes.
Isn't there a cost differential between Northern Tioga and Radnor. The answer is yet, but
not enough to explain the great differences in spending. The percent of wealth describes
20% of the regression.
Under redirect, Dr. Salmon said that wealth is the dominant factor.
Dr. Jimmy Fortune was admitted as an expert witness in the field of school finance. He
explained the following concepts:
Multiple regressions - If you have a dependent variable such as the cost of a house,
how is it effected by the income of one spouse and another spouse that isn't earning as
much money. You want to find out if there if a relationship with either of those
variables, or even both together, or trying to eliminate one.
In multiple regressions you run the risk of something called co-linearity, where one of
those variables is related to each other. In that case, where they are related they play
off against each other and suppress the real relationships with the value of the house. If
that happens, you sometimes get a negative number and you realize that you have
co-linearity and you have to start over again with at least one new variable. In Dr.
Fairley's regression analysis he did come up with a negative number and then stated that
the more money you spend the less results you get. That means the highest spending
district does not do as well, and that simply is not the case.
Dr. Fortune also talked about the use of TELLs tests as a proxy for intelligence. This
test was not a test of achievement. It was a pass fail test and to use it without any
understanding of how kid actually did is bad statistics. To compare one year of TELLS when
there is an acknowledgment that the test had changed and that even the population changed
is not a proper way of doing research.
In looking at the wealth measure on the PSSA tests there are very positive relations
between results at the highest and lowest levels between achievement and spending. That
seems to occur over and over again to the point where the statistics tell you that it will
happen 999 times out of 1000. That is significant.
Dr. Fortune also pointed out that a literature search would have produced over 300
studies on the money matters or doesn't matter discussion. Dr. Fairley limited himself to
6 books.
Dr. Fortune also quarreled with Dr. Hanushek's use of the null hypothesis and using it
as the basis of his results.
On cross examination, Dr. Fortune was asked if he used socio-economic indices. He said
that he hadn't. Does the wealth spending relationship have a predictive and causal value.
He said yes to predictive and no to causal
Dr. Kern Alexander was the next witness. He discussed the relationships between sets of
graphs of Fairley and his own. He viewed the presentation of Dr. Fairley's as skewed with
the use of population. He views a .60 correlation as very strong in Dr. Fairley's work and
his own correlation between spending and wealth as even stronger using students. Even if
there is no statistical causation, the 20 year longitudinal study in the Commonwealth
shows the same thing year after year. There certainly is a strong relationship. Do the
wealthiest really need more money, or do the poor. If there is no relationship or even
causality, you are implying that there is no value to the dollar spent. If you even
determine who is efficient and who is not , there still must be a value to the dollar on
some level. Does the cost of education justify the differences in spending? The system is
inequitable on its face. It is one of the worst in the nation .
The cross examination related to the flattening effect of state money. Dr. Alexander
also pointed out that the severe tax effort of the poor does that too.
Judge Pellegrini wanted to know if you took away Southeast PA would everything flatten
out. Dr. Alexander said that it would be flatter, but still differences. Judge Pellegrini
asked how you would determine a foundation amount. Dr. Alexander suggested that you
aggregate all the wealthy school districts and set the dollar amount just below the last
on the list. He also said that we are responsible for all the children in PA. We cannot
separate them.
Today January 29, 1997's witness will be Dr. Richard Altenbaugh of Slippery Rock
University. He will be the last rebuttal witness.
The oral arguments will take place sometime in the next few months. There
will findings of fact for both sides over the next month. The state has the right to call
its own expert witness or historian. |
