Education funding is a complicated topic anyway, but it’s especially difficult to understand in Illinois given the heated rhetoric from both Democrats and Republicans.
There are the Republican refrains railing against the “Chicago bailout” and House Speaker Michael Madigan and parliamentary moves by Democrats to artificially create a crisis.
There are the Democratic calls for Governor Bruce Rauner to negotiate in good faith instead of merely threatening to veto an approved spending plan for schools.
And the standoff has prompted doomsday scenarios of public schools not opening, or closing midyear because of what sounds like a huge gulf between the two parties.
But the situation is actually pretty simple:
• There is widespread agreement among Republicans and Democrats that Illinois’ funding model for K-12 education should be changed to narrow the gap between rich and poor school districts through greater state aid.
• Both Republicans and Democrats agree on a basic school-funding-reform framework.
• Reaching the funding targets for each school district under that framework would cost the state and its taxpayers billions of dollars annually compared to what’s been spent in the past.
• The state budget enacted on July 6 (through overrides of Rauner’s veto) includes roughly $350 million in additional funding to get school districts closer to their education-funding targets.
In other words, pretty much everybody agrees on the problem and the solution. Additional money has already been budgeted to start the process.
In the Illinois Senate district that includes the Quad Cities, the 20 school districts would receive at least an additional $7.66 million this school year toward their funding targets – including four districts that would get more than $1 million. (Under the Republican plan, a fifth local district would get more than $1 million.)
The difference between the parties is whether several hundred million dollars should go to Chicago Public Schools or be distributed among the state’s other needy districts. That’s real money, and there’s no denying that the dispute might be difficult to untangle with the regional and party politics at play.
But those funds also represent just a few percentage points of overall state spending on schools, and the difference should be something that reasonable people (and even Illinois politicians) can bridge.
Given all that, the education-funding question in Illinois will be resolved – and if it hasn’t been by the time this article is published, it’s likely to settled in the next few months. The final result will almost certainly sit in the narrow gap between the two similar plans currently on the table.
In the meantime, the deadlock is leaving school districts in the lurch. “We don’t know what we’re getting, which is a nightmare for planning purposes for school districts,” said Silvis School District 34 Superintendent Terri VandeWiele.
Although the first day of school for many Quad Cities-area districts comes in early August, that’s a somewhat artificial deadline for legislators and the governor; no school district in the state has yet announced plans to delay its opening date.
But some schools are likely to close their doors at some point during the school year as their districts run out of whatever money they have. If it’s going to take an actual crisis to resolve the issue, it will come in the fall instead of August.
I spoke to representatives of several Quad Cities-area school districts, and each is in a slightly different position.
Without an enacted school-funding mechanism, Rock Island/Milan School District 41 will open its schools on August 3 but would have to borrow money to stay open starting in December. Superintendent Michael Oberhaus said his school board has not yet decided whether it will close schools at that point.
Silvis plans to open its schools on August 7 and has enough reserves to make it through the school year – but VandeWiele said the district would evaluate its position throughout the school year.
Moline Unit School District 40 will start on August 22 and will not close its doors during the school year, said Chief Financial Officer Dave McDermott. Although it would need to borrow money to stay open – probably early in 2018 – he said the school district has an obligation to its taxpayers.
United Township High School District 30 opens on August 2 and will stay open even if the state-funding stalemate drags on through the end of the school year. “We’ve saved and developed fund balances anticipating raining days coming,” said Superintendent Jay Morrow, “and it’s been raining pretty hard. Now it’s pouring, possibly.”
A Game of Chicken
For decades, Illinois has used as its core school-funding mechanism a guaranteed “foundation” level for basic educational expenses that comes from a combination of local property taxes and state aid. The level was set at $6,119 per student in Fiscal Year 2010 and hasn’t been changed since. In fiscal years 2014 through 2016, the Illinois General Assembly underfunded the state commitment by approximately 10 percent. (Beyond foundation funding, schools also receive state and federal money for specific line items such as transportation, special education, and free-lunch programs.)
“The [foundation] funding level was predicated solely on the amount of money the state had available,” Oberhaus said. Illinois has sometimes convened panels to determine what a proper education costs, but “the state has never come close to funding that level.”
This funding model has resulted in a wide disparity among school districts in overall education spending. Because of the state’s reliance on local property taxes to fund education, property-rich districts spend considerably more per student than property-poor districts.
In a 2015 study, the Education Trust found that Illinois had the largest percentage gap among states in per-pupil funding when comparing low- and high-poverty districts. School districts serving the highest percentage of poor students got 20 percent less money from state and local sources compared to those serving the lowest percentage of poor students.
An Education Week analysis of federal data showed total per-pupil spending in Illinois school districts (adjusted for cost of living) ranging from just over $7,000 to more than four times that amount in Fiscal Year 2013. The U.S. average was $11,841.
In the Illinois Senate district that includes the Quad Cities, the spending range was generally between $11,000 and $13,000 per student – although Erie Community Unit School District 1 spent more than $19,000.
The education-funding-reform legislation favored by the respective parties – Senate Bill 1 from Democrats and Senate Bill 1124 from Republicans – would eliminate the largely arbitrary foundation formula.
The bills are substantially similar in premise and methodology. Both create an “evidence-based” funding model that would distribute new state education money based on calculations of what it would cost each district to educate its students adequately, and how far each district is from that goal.
Chicago Public Schools funding is the primary difference between the proposals, although the bills also take a slightly different “hold harmless” approach – the concept that no school district should lower its education spending under a new system.
You might expect that the old formula could be used until some compromise can be reached, but that’s where the state’s ugly politics enter the picture: The recently enacted state budget requires an evidence-based school-funding model before money can be given to school districts.
The Democrats who crafted the budget and inserted that “poison pill” made the bet that they could use a manufactured schools-not-opening/schools-closing “crisis” to force Rauner – or some Republican legislators in a veto-override vote– to sign off on Senate Bill 1. That’s the reason Senate President John Cullerton held Senate Bill 1 – passed by both chambers in May – until July 31, preventing any action by Rauner.
But the urgency of funding schools has given Republicans leverage, too, and they’ve cast their lot with Senate Bill 1124 – hoping Democrats outside of Chicago might be lured by the promise of even more money for their districts at the expense of Chicago.
At press time, neither side had yet blinked in this game of chicken.
The Cost of an “Adequate” Education
What gets lost in the noise of the education-funding debate is that both the Democratic and Republican plans represent the same logical and thorough approach to funding education.
Fundamentally, both bills are a variation on “zero-based budgeting.” Instead of using the status quo as the starting point for funding decisions, these systems prescribe an “adequate” level of staffing and spending based on each district’s unique characteristics – the number of schools, the size and composition of its student population including factors such as poverty and English-language learners.
This is a major departure from both how education funding is often done and how it’s typically measured. Iowa, for instance, uses a mandated, uniform per-pupil funding level for all school districts, the state component of which is largely dependent on available money. Most comparisons of education funding are based on what other states and school districts spend – for example the Education Week analysis classifying districts in relation to the national average.
Both Senate Bill 1 and Senate Bill 1124 throw out those norms, and instead try to create an optimal funding level for each district – one that doesn’t take into account state revenues or education funding elsewhere.
“It’s a reasonable model that makes sense if you really look at the components of what quality education is and fund them,” Oberhaus said. “And it’s a logical model compared to where we were before.”
Both bills use 24 “essential elements” to determine each district’s level of “adequate funding.” In essence, the bills have a formula for determining what each district should be spending based on standards for everything from the number of teachers to administration to support staff to enrichment programming.
Some of these are based on enrollment. Under Senate Bill 1, for example, adequate funding for gifted programs is $40 per K-12 student. “Instructional material investments” should be $190 per pupil, including K-12 students along with pre-K students with disabilities.
Others are based on the number of schools. Each district’s “adequacy” funding level would include one librarian per school and one full-time tutor per school, for instance.
And still others take into account the number of low-income students or students with special needs. The number of teachers for each district’s “adequacy” figure would be based on its percentage of low-income students. Senate Bill 1 allows for one teacher position for each 15 low-income students in grades K-3 and one teacher position for every 20 non-low-income students in those grades.
The result is that school districts with higher concentrations of poverty, students with disabilities, and English-language learners would have a higher “adequacy” funding level per pupil than school districts with lower percentages of those populations.
The bills then provide a mechanism to close the gap between school districts that are near or above their adequacy level and those that are well below. Ninety-nine percent of new state funding under Senate Bill 1 would be distributed to school districts below 90 percent of adequacy. (School districts are put into four tiers that are used to allocate new funding.)
There are other key features to these systems, including the hold-harmless provision to ensure that better-funded schools don’t end up with less money overall. And a “local capacity target” is used to make sure local property taxes represent a fair percentage of a school district’s revenue.
While neither bill includes provisions to ensure the extra money improves student achievement, in 2015 the General Assembly passed the Illinois Balanced Accountability Measure, which is being implemented by the State Board of Education through Fiscal Year 2022. The model diminishes the weight of test scores and graduation rates in evaluating school performance and is intended to give districts greater flexibility in demonstrating progress.
With the billions of dollars Illinois will (eventually) send to school districts in increased state aid, it will be essential for legislators, taxpayers, and school boards to carefully monitor school performance. If Illinois continues to boost its education funding and school districts move ever closer to “adequate” funding, there ought to be commensurate gains in student achievement.
That is, after all, the entire premise of these evidence-based systems – that schools have been historically underfunded and can’t do their jobs without the proper resources. The evidence-based models seem to be rational attempts to quantify the cost of a basic public education, but if performance doesn’t rise with funding, legislators will need to figure out what went wrong.
Where the Money Will Go
For now, though, both parties are nearly on the same page with Senate Bill 1 and Senate Bill 1124.
In Senate District 36 – which includes the Quad Cities – seven of 20 school districts are below 60 percent in their funding-adequacy figures based on the bills’ formula, including United Township High School (52 percent of adequacy), East Moline School District 37 (56 percent), Rock Island/Milan (59 percent), and Silvis (59 percent).
Only three of the 20 districts are over 70 percent: Erie (155 percent of adequacy), Rockridge Community Unit School District 300 (86 percent), and Riverdale Community Unit School District 100 (75 percent).
These are numbers that Democratic and Republican legislators have already agreed upon. So in 17 of 20 area school districts, there’s consensus that school funding overall would need to be increased by at least 42 percent to go from sub-70 percent to 100.
Under Senate Bill 1, Rock Island schools would receive an additional $2.05 million in the current fiscal year. Sterling Community Unit District 5 would receive $1.27 million, East Moline $1.2 million, United Township High School $1.02 million, and Moline $670,000.
The remaining 15 school districts are each slated to get less than $350,000. Erie schools, the only local district above the adequacy level, would get less than $700 in new money under Senate Bill 1 – an illustration of the legislation’s hold-harmless provision but also of its principle that wealthy districts should get substantially less benefit from funding reform than needy districts.
Under Senate Bill 1124, all of the funding increases would be higher, part of which would come from Chicago Public Schools money being redistributed throughout the state. But another portion is the result of a higher price tag – $692 million – that does not appear to be fully funded in the state budget.
Again, these 2017-18 funding increases would fall far short of funding “adequacy” for nearly all local school districts. “That [$350 million] does not fully fund the adequacy model,” Oberhaus said. “It takes billions of dollars to fully fund it. But at least it’s an attempt to understand we need to keep incrementally changing that ’til we get to that level.”
Another crucial distinction is between funding and spending. Many school districts now operate in the red, meaning that their expenditures are closer to the adequacy level than their income.
Windfalls That’s Aren’t
Take United Township. It might sound like Senate Bill 1’s additional $1 million would be a major windfall for the district, but its superintendent said the money would simply erase this year’s deficit.
“We projected a deficit about $1.3 million in the education fund” for this school year, Morrow said. “That’s worst-case scenario. If Senate Bill 1 was signed as-is ... , that would pretty much hopefully take care of our deficit. ... That would mean we’d be operating in the black, which we haven’t done for years.” In four of five fiscal years from 2012 to 2016, United Township operated with a deficit.
Similarly, Moline schools project a current-year education-fund deficit of $700,000, CFO McDermott said, so the additional money under Senate Bill 1 would only allow the district to break even.
Rock Island/Milan schools have a projected $1.1-million deficit this fiscal year, Oberhaus said. So the bulk of the $2 million in additional funding under Senate Bill 1 would merely eliminate the deficit. The school district would have additional money beyond that – although Oberhaus said the school board wouldn’t decide what to do with it until it becomes a reality.
That’s another result of the school-funding stalemate: School districts can’t count on the extra money, so they’ve crafted their budgets without it.
“I am not planning for extra money this year,” said Silvis’ VandeWiele. “I’m always planning for the worst-case scenario. ... I’m assuming we’re going to get what we got this [past] year, which was less than what we were owed.”
But VandeWiele said she has ideas on how her district might spend the $175,000 in new money that it would get under Senate Bill 1. She said, for example, that she’d like to add summer school, and she’d like to increase the level of support for English-language learners in the district. Right now, she said, the district has one teacher and one paraprofessional for English-language learners, and the ideal would be having enough staff to assist students in their regular classrooms instead of just in a special class.
The school-funding issue also has repercussions beyond operational money. Morrow said, for instance, that United Township is holding off on spending money from a 1-percent sales-tax surcharge that Rock Island County voters approved in November for school capital projects. (That money won’t start coming to school districts until November, but the Rock Island/Milan district has already begun some construction projects.)
“We’re doing significant planning right now,” Morrow said, “but if we wanted to start a construction project next spring, next summer, we almost have to approve the ... architectural designs ... here in August for it to be ready to go out to bid in January. We can’t in good conscience go forward with any construction project if there’s no state budget [money distributed to schools]. It would look horrible ... . It just doesn’t make sense to have a construction project going on when the state money’s not coming in, even though they’re separate pots of money. ...
“It’s almost impossible to plan anything long-term because of this ongoing mess that we’re in.”
