Facts to know to follow money debate

Colorado teachers marched at the Capitol this week for more school funding and better pay. Advocates for more education funding will point to the $7 billion that the state has withheld from schools since the Great Recession, while fiscal conservatives point to the billions the state has spent on schools in those same years.

Here’s what you need to know to follow the money debate behind these teacher days of action.

In 2000, Colorado voters approved a constitutional amendment that said the state had to increase K-12 education funding every year based on inflation and population.

It was meant to reverse years of budget cuts in the 1990s.

When the Great Recession hit and revenues declined, state budget writers didn’t think they could meet that obligation and pay for other functions of state government, so they started holding money back.

This reduction is known as the budget stabilization factor or the negative factor.

The negative factor ballooned to more than $1 billion in the early 2000s as the lagging effects of the recession hit government revenue.

State spending on K-12 education declined in some years, and many school districts froze pay and cut programs. More recently, lawmakers have reduced the negative factor and increased education spending, but the state continues to hold money back.

Republicans dispute this characterization. The state Supreme Court, in a split decision in 2015, ruled that the state’s school funding and use of the negative factor is constitutional. Schools have other sources of revenue, including federal dollars and local property tax revenue.

The National Education Association’s 2018 state rankings puts Colorado 28th in per-pupil funding, when federal, state and local dollars are included.

After state officials calculate the amount of money each school district should get, they collect that money first from the local property taxes. If that doesn’t meet the amount set by the formula, the state fills in the rest.

School districts don’t benefit much from increases in property values. If a school district collects more money because homes are worth more, the state holds back a corresponding amount.

There are two ways local school districts can raise additional local money, but both require voter approval. Some communities, including Denver and Boulder, have passed significant tax increases to give their schools more money. Other communities in the state have never been successful in asking their voters for more local funding.

Colorado’s public employee retirement system, in which teachers participate, has an unfunded liability of $32 billion to $50 billion. As lawmakers try to address this, various proposals have called on employees and employers to pay more.

Retirement benefits, such as health insurance, make up a growing share of school districts’ personnel budgets. So if they have to pay more into PERA, that’s less money for other education needs, including teacher pay.

Proposed solutions also call for reducing cost-ofliving increases for retirees, raising the retirement age and putting more taxpayer dollars into the system.

Democrats and Republicans don’t agree on the right balance, and whatever they decide will have implications for district budgets and teacher paychecks.

The bulk of marijuana tax revenue for education goes to a program that helps schools pay for buildings and construction repairs. Districts apply and compete for grant money from the program, and in most cases they have to put up some portion of the project’s cost.

This money can’t be used for things such as teacher salaries or books.

This year there’s bipartisan legislation to increase the amount of marijuana money that goes to capital construction.

Chalkbeat Colorado is a nonprofit news organization covering education issues. Visit chalkbeat.org/co.