PARSS Newsletter
March/April 2000

SO WHO’S GONNA PAY FOR THE FUEL INCREASES?

Tim Potts, Executive Director of the Pennsylvania School Reform Network has pointed out that:
This increase for the 2000-2001 school year is 3% over the previous year for increasing enrollments, while non-public schools receive a 3.9% increase with declining enrollments. Basic Education Subsidy, as a percentage of the state budet, has  decreased from 38.2% in 1986-87 to 32.8% in the proposed budget. “While Technology education is important, it does not take the place of human interaction, and there have been no studies to show what educational gains, if any, we are getting from this substantial investment in technology. This program begs for accountability.” The Pennsylvania School Boards Association, in its February 18,2000 edition of the ILS commenting on the $330 million tax rebate had this to say, “The $330 million set aside for the program will provide relatively small one-time assistance to some taxpayers. That same amount, added to the basic subsidy and special education line items, could enable school boards to hold down property tax millage rates and, in the process help to produce a more meaningful partnership between state government and local school districts in the funding of public schools.”
	The $111.7 million additional funds is a 3% increase in basic education funding. These dollars would be available to local school boards to use to fend off inflationary costs, replacement of materials, supplies, textbooks, etc. These funds must now be used to make up for massive increases in diesel fuel for busses and heating oil for some schools. In a brief survey of some of our rural schools, costs for these items have in some cases doubled over the past four or five months. Whether districts run their own busses, or contract out, the costs have skyrocketed. Even if bus contractors have no escalator clauses in their contracts with school districts, they are still approaching boards with requests for increases, because they might not be able to continue to operate their vehicles. Although many districts have converted to dual/fuel, or are on natural gas or electricity, there are those that are directly dependent on fuel oil.

This problem points out some of the flaws in categorical aid. Since funds are restricted to certain programs, then the only answer for many school districts is to raise local taxes, if the state is not forthcoming in basis education subsidy.

HEARINGS ON SCHOOL FINANCE AND FUNDING PROPOSAL

Senator James Rhoades’ funding bill has attracted 18 sponsors to this point. PARSS is expecting even more by the time the bill gets to a vote sometime later in the year. Senator Rhoades, Chairman of the Senate Education is establishing hearing sites across the state, on school funding, taxation and the funding bill. The first session will have taken place on March 22, 2000. Keep your eyes peeled for further information on this topic. Thanks to all of our PARSS members for contacting their state senators to sign onto the bill.

JOE SAYS  
(This month’s editorial is by Winston Cleland, Supt. West Perry School District)

Governor Ridge recently presented the 2000-2001 budget which includes a statewide 3% increase for basic education funding. The budget also includes a 6.5% increase for special education funding. The Administration claims that increases in education funding demonstrate strong, continued support for public education in Pennsylvania. A review of the Basic Education Funding increases for West Perry clearly demonstrates a continuing decline in the state’s commitment to provide adequate support for public education in rural and poorer than average school districts throughout the Commonwealth.

West Perry, as an example, is projected to receive $6,552,736 in Basic Education funds for the 2000-2001 school year. This proposal is an increase of 2.2% over the 1999-2000 allotment of $6,414,728. The 2.2% increase in Basic State Subsidy funding demonstrates no commitment to support public education in a school district with an aid ratio of approximately .60. This increase is slightly below a cost of living adjustment.

When a several year period of Basic Education funding for districts such as West Perry is analyzed, a clear pattern emerges of declining support for public education. The percentage increases in Basic State Subsidies from the 1991-92 school years through the proposed state subsidy for the 2000-2001 school years is listed below (see box).

The district’s Basic Education funding has increased by an average of 1.82% during each of the last nine years. There was only one fiscal year, the 1994-95 school year, in which the state’s funding allocation increased more than the cost of living. The state subsidy was frozen, for West Perry for three of these years and two years for the entire state. These data clearly indicate that the state is not fulfilling its obligation to provide a thorough and efficient education for the students of the West Perry School District. The Board of School Directors has been required to raise local taxes to help maintain the educational program. Finding sufficient funds to add new programs to help support students who need remediation and to provide rigorous and challenging programs to meet the needs of academically talented students has been very difficult. It has been impossible to provide counsleing support for at-risk students or to operate a reasonable alternative education program.

A review of the proposed basic education subsidies for districts in Cumberland County also clearly demonstrate a lack of commitment to fund public education. Cumberland Valley, Mechanicsburg and Camp Hill School Districts are receiving a 1% increase in basic education funding. Carlisle and Big Spring are receiving 2% increases, while South Middleton, Shippensburg and East Pennsboro are receiving 3% increases in state funding. In Perry County, Susquenita is receiving a 2% increase in Basic Education funds. Basic subsidy funding for all the above school districts has also shown patterns very similar to the information provided for West Perry during the past nine years.

The district has received an additional $48,027 (4.3% increase) in special education revenue during the current school year. Due to an increased number of special education students and state and federal special education mandates, the district will again be required to add both teachers and instructional aides to simply remain in compliance with state and federal regulations. It is beyond the scope of this editorial to thoroughly analyze the severe financial constraints placed on local school district budgets by increased special education requirements and other increased mandates which have not been supported by additional state funds during this period. This is another example of a major state and federal mandate which has been underfunded by the Commonwealth of Pennsylvania. Local taxpayers have had to bear an ever increasing burden, and it appears that it is “business as usual” in Harrisburg.

The process of funding public education in the Commonwealth of Pennsylvania is broken. The underfunding of public schools has become endemic. This is true for all school districts in Pennsylvania. It is obvious that this underfunding puts an ever increasing burden on local taxpayers. This endemic underfunding of public education is being hidden under a deceptive advertising campaign. The funding mechanisms for both basic education and special education programs are broken. It is time to repair the funding of public education in Pennsylvania.

SO WHAT AM I TO DO????

Eventually this project will dovetail with a $2.5 million grant to Standard and Poors to analyze academic and financial indicators and make the results of these analyses available to the public. Michigan has already announced that it will begin to use this system. Financial reporting will become more detailed in an expansion of the present system of keeping track of funds.

The following was contained in an e-mail sent to PARSS by a business manager of a 3,500 student school district in a rural area. The gist of the e-mail was confirmed by four other business managers across the state.

“In my district, there are two principals covering nine elementary buildings. These buildings each have K-5. One principal covers four buildings with six grades each and one building with two of each grade. This gives me thirty budgetary accounts that her salary has to be pro-rated. Assuming that her salary is $62,000, and we have twenty-six pays in a fiscal year, that means that I have to charge approximately $80 each pay to a budgetary account. On top of that I will have thirty budgetary accounts that her benefits will have to be charged to and each pay (Social Security and the District’s share of retirement) an additional sixty accounts.

For Social Security I will be charging $6.08 each pay to thirty budgetary accounts and for retirement I will be charging $1.50 to each budgetary account. Currently my payroll system will allow us to automatically charge a person’s pay to no more than six budgetary accounts. So our payroll program has to be modified by July 1. In the 1000 series of the budget, we have calculated that for professional employees only, we will have to create 2,562 new budget accounts just for payroll plus an additional 715 accounts to handle benefits. This does not include the accounts necessary for the non-instructional staff. We only have 237 members of the professional staff and these account codes do not count those members whose payroll is charged in the 2000 series of the budget.

When you factor in substitute teachers, the record keeping is an even bigger nightmare. Based on my estimates, the district will be running in excess of 9000 budgetary accounts for expenditures. I don’t have the staff for this and I’m sure that the Board is not going to provide me with additional staff.

I am not sure why we are approaching governmental accounting as cost accounting. I am not sure if that is a contradictory principle. There are many variables that will be left out of a truly “accountable system” such as age and condition of a building, age of staff, geographic location of building, student size of building, student size of school district and many more.

I trust that there are answers to these questions.

CLEAN AND GREEN REDUX

With the change in the Pennsylvania Farmland and Forest Land Assessment Act of 1974 (otherwise known as Clean and Green) in 1999, there will be many rural school districts that will be affected negatively. The Joint Government Commission, using 1995 numbers estimated that $3.9 million would be lost by local taxing authorities if all those eligible would apply for their exemptions this coming year. The County Commissioners organization is working on an update, including the most current changes. It is estimated that the change to the law could triple that number. Senator Roger Madigan has proposed a bill, SB 1155, that is now in the Rules Committee, that will alleviate the problem caused by the change.

“The General Assembly finds that although all citizens of this Commonwealth benefit from the preservation of open space lands, the burden of shifting of real property taxes falls heavily on certain local taxing authorities. In order to ensure that the taxpayers of these local taxing authorities do not bear too much of the burden of this act, it is in the public interest to make assistance payments to these authorities from the General Fund, where authorities would otherwise lose 10% of more of their assessed value as a result of this act.”

If you want to see the entire bill, go to the “legislation online” segment on the PARSS website, WWW.PARSS.ORG  and plunk up SB 1155. Please help us and you by contacting your local representatives about this bill. Representative Scott Chadwick has a bill in the House that would delay the implementation of the law for a year.