Legislating financial harm to public schools
A preponderance of evidence suggests that state legislation financially harms public school systems, especially those with high poverty.
The state of Indiana’s decision to fund schools through sales and income tax put school funding at the mercy of the economy. When the Great Recession hit in 2008, school funding was cut $300 million and was never restored.
High poverty school systems don’t receive 10 to 40 percent of their property taxes, totaling in the millions of dollars. State education funds intended for instruction and salaries must cover those losses.
State-mandated tax caps have reduced property tax funds. The 2020 tax caps will total more than $100 million lost across schools systems. House Bill 1021 will only protect 25 of the nearly 100 school systems facing those losses.
Fifty-four percent of all school systems in the state — primarily in urban and rural areas — face declining enrollment. Many schools lose students to the lure of charter school promises that go largely unfulfilled. Public school funding is diluted among charter schools, with no evidence of improved education. The traditional public school graduation rate is 91 percent, while charter and virtual school graduation rates are 40 percent and 27 percent, respectively.
State policy has imple- mented voucher funding for private schools. Vouchers initially were promised to help poor students in public schools, but more than half of all vouchers go to private school students who never attended a public school. Voucher increases go to parents of higher and higher wealth. An estimated 1,300 voucher families earn more than $100,000 (placing them in the top 20 percent in terms of income). Every public school system in the state loses more than $150 per student due to vouchers.
The state’s solution for public schools facing reduced, inadequate funding is to encourage them to pass a referendum. This option works primarily for the wealthiest communi- ties, not the poorest. Some wealthy communities are seeking their third referendum, while poorer communities have none.
Projections for new House Bill 1001 education budget show 1.6 percent increase for public schools, 11 percent for charters, 10 percent for vouchers and 9 percent for virtual schools, despite allegations of fraud.
HB 1001’s proposed 2 percent increase is inadequate and below the cost of living increase of 2.7 percent. Indiana is among the worst in the nation in education funding, lagging behind inflation.
The Complexity Index is the portion of school funding based on providing additional funding for the most disadvantaged stu- dents in poverty. The state now requires that only students on public assistance count in the CI, rather than the many more students on free and reduced lunch.
HB 1001 will outrageously reduce Complexity Index funding by 14 percent and redistribute it across the state. The growing wealthier communities will get the lion’s share of those funds — taking from the poor, giving to the wealthy. HB 1001 creates extreme winners and extreme losers.
Almost 30 percent of urban and rural school systems will see a loss of state funding compared with the current school year, with more than half receiving less than a 1 percent increase.
Unless changed, this proposed legislation will continue to harm schools that serve the most disadvantaged students. In this light, legislative concern about teacher salaries and teacher shortages can only be seen as disingenuous.
Urge your legislators — call 317-232-9400 — to increase state funding by 3 percent, protect schools from new tax cap losses, put caps on charter and voucher expansion, and leave the Complexity Index funds for the poor.
Tony Lux is a board member of the Indiana Coalition for Public Education and the NWI Coalition for Public Education and a retired superintendent of Merrillville Community Schools.