School Finance

When then-Governor Ted Strickland issued his Evidence-Based Model (EBM) of school funding reform in 2009 we engaged Professor Paul Hill to provide an analysis of the proposals. We couldn’t think of anyone better to do the work than Professor Hill. His credentials are impeccable. He is founder and recently retired director of the University of Washington’s Center on Reinventing Public Education, and a former Senior Fellow at Brookings and RAND. Further, Professor Hill has roots in Ohio as a graduate of Ohio State University. He also has family in Dayton.
 
Professor Hill’s analysis of Strickland’s plan was largely informed by the research project he led, Facing the Future: Financing Productive Schools. That six-year effort, funded by the Bill & Melinda Gates Foundation, was the most comprehensive study of its kind ever conducted. It concluded that America’s public-school finance systems are burdened by rules and narrow policies that hold local officials accountable for compliance but not for results. Facing the Future was the work of more than 40 economists, lawyers, financial specialists, and education policy makers. It included more than 30 separate studies, including in-depth looks at Ohio, North Carolina, Texas, and Washington.
 
Based on findings and recommendations from Facing the Future we asked Professor Hill to develop a “crosswalk” between the key findings of that seminal report and the policy recommendations in the Strickland’s Plan. Professor Hill’s analysis of Governor Strickland’s EBM was not kind. It stated bluntly, “Though Governor Ted...

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How does Governor Kasich’s school funding plan stack up, according to one of the nation’s foremost experts in school finance and reform?  Find out in our latest publication, Steps in the Right Direction: Assessing “Ohio Achievement Everywhere” – the Kasich Plan.

In 2009, Fordham's Ohio team engaged Professor Paul Hill to to provide an analysis of then-Governor Strickland's school funding plan. We couldn’t think of anyone better to do the work than Hill—he is founder and recently retired director of the University of Washington’s Center on Reinventing Public Education, and a former Senior Fellow at Brookings and RAND. He was also the lead researcher on Facing the Future: Financing Productive Schools, a six-year effort, funded by the Bill & Melinda Gates Foundation, which concluded that America’s public-school finance systems are burdened by rules and narrow policies that hold local officials accountable for compliance but not for results.
 
Fast forward to 2013, and another Ohio governor is proposing a school funding reform plan. We once again asked Professor Hill if he would provide a review of the governor’s plan. As the title notes, Professor Hill observes that Governor Kasich’s reform plan will advance Ohio and it schools, but it could be better and bolder. Download the short report to learn more about Professor Hill’s take on Kasich’s school funding plan....

Charity Hallman
When Teachers Choose Pension Plans: The Florida Story

Talk of pension reform for K–12 public school teachers is known to spark an array of emotion, ranging from boredom to rage. It's understandable—the issues with traditional pension plans are complex and personal. Yet, it's critical that policy makers, taxpayers, and especially teachers join the conversation.

The Thomas B. Fordham Institute recently released a case study on Florida's teacher pension reform that adds to a growing body of evidence that it is possible to reform teacher pensions and that teachers do in fact want portable retirement plan options. These are important findings that help to debunk the popular myth that all teachers prefer traditional, defined benefit, retirement plans.

The final retirement benefit paid to an employee under a defined benefit plan is a fixed amount determined through a formula that includes years of service, final average salary, and a salary multiplier. In defined benefit plans, employees' benefits are not affected by investment gains or losses. In order for a teacher to receive the full benefit these plans provide, however, they must continue to work as a teacher, typically within the same state, from 25 to 35 years. Otherwise, the teacher incurs significant losses from their retirement wealth. For example, a teacher who splits a lifelong career between two pension plans...

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Lima, Ohio, recently named the nation’s ninth saddest city, received some cheer earlier this week when Governor John Kasich strode into town for his annual state of the state address. Among the myriad of topics the governor touched upon was K-12 education reform, and the residents of Lima—and many more across the Buckeye State—should be heartened by the education reforms he proposes.

Among the boldest and most exciting reforms the governor proposes, is his overhaul of the state’s school funding formula. The funding proposal the governor has laid forth levels the playing field for all Ohio students. It ensures that youngsters who attend a public school system with less local wealth—measured by property value and income—receive more state aid. For example, according to the governor’s preliminary FY 2014 estimates, the property and income-rich Upper Arlington schools near Columbus would receive no state aid for its regular students. (It would receive aid for its special education, economically disadvantaged, gifted, and English language learner students.) The state assumes, correctly, that Upper Arlington’s local residents can and will raise sufficient revenue to educate their children. This is sensible public finance—furnishing limited state funds to Upper Arlington is like giving Donald Trump social security. They simply don’t need it.

Meanwhile, the governor’s proposal provides generous state aid to students who reside in poorer, hard-scrabble communities such as Lima. Lima doesn’t have five-bedroom homes that generate large amounts of school tax revenue, and additionally, its residents don't have surplus income lying around...

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GadflyIn a futile effort to counter the influence of test-preparation companies, New York City’s education department changed part of the test it administers to four-year-olds to determine whether or not they are gifted and talented. For parents who cannot afford to send their child to one of the city’s myriad private schools, a coveted and scarce seat in a public school gifted program is the best start they could give to their children. While many lament the unjust advantage that students with access to test-prep programs obtain, the true tragedy is the dearth of suitable options for all of the gifted children. For more, listen to this week’s Gadfly Show.

Eliciting a keen sense of deja vu, this year's AP Report to the Nation—College Board's tracking of AP course-taking patterns and exam pass rates—offers the same three takeaways as last year's report: Participation rates in the AP are fast on the rise (up 2 percentage points since last year and 14 since last decade). So are AP exam passing rates: up 1.5 percentage points since 2011 and 7 points since 2002. Still, minority involvement flounders, with less than a third of "qualified" Latinos and African American (as decided by PSAT scores) enrolling in an AP course. Expect further unpacking of what these numbers may mean for Common Core implementation, college-remediation courses, and more next week.

The congressionally mandated Equity and...

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In an era of budgetary belt tightening, state and local policy makers are finally awakening to the impact of teacher pension costs on their bottom lines. Recent reports demonstrate that such pension programs across the United States are burdened by almost $390 billion in unfunded liabilities. Yet, most states and municipalities have been taking the road of least resistance, tinkering around the edges rather than tackling systemic (but painful) pension reform.

Is the solution to the pension crisis to offer teachers the option of a 401(k)-style plan (also known as a "defined contribution" or DC plan) instead of a traditional pension plan? Would this alternative appeal to teachers?

When Teachers Choose Pension Plans: The Florida Story sets out to answer these questions.

We laughed. We cried. We wondered how in the world his proposals wouldn’t increase our deficit “by a single dime.” President Obama’s fifth State of the Union delivered an aggressive call to expand pre-Kindergarten opportunities to all four-year-olds (the overall cost of which remains decidedly murky), to create a Race to the Top offshoot focused on pressing high schools to better prepare students for high-tech jobs, and to hold colleges accountable for keeping tuitions affordable—a classic liberal wish list to be funded via voodoo economics and shell-game fiscal policies.

Maryland told nine of its counties—including smug Montgomery, whose teacher-evaluation proposal the state rejected earlier this month—that the Maryland School Assessment must comprise at least 20 percent of their teacher- and principal-evaluation models. “My team and I are fully prepared to make visits to your district to provide clarification and to assist you in reaching approved status,” Dave Volrath of the state education department offered helpfully to Montgomery County. Yeah. We’re sure it’s all just a big misunderstanding.

Since 2007, hundreds of California school districts and community colleges have used $7 billion in “capital-appreciation” bonds to finance school-construction projects. The catch? Capital-appreciation bonds can balloon to more than ten times the amount borrowed over as much as forty years. For scale, compare this to a typical thirty-year home mortgage, which will wind up costing two to three times the amount borrowed. We are speechless. We thought pensions were the most vivid example...

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At last week’s "virtual town hall" meeting to unveil his school funding and reform plan, Governor Kasich asked me to share what I thought was most exciting about his plan. I almost jumped out of my chair with excitement, and responded: “The Straight A Innovation Fund is incredibly exciting…You're going to be freeing people up, and I think there's a lot of untapped energy out in the field that's waiting to, in effect, take charge and take control of the opportunities.”

It was hard to believe that an Ohio governor was actually proposing to create an innovation fund and that it would distribute real money: $100 million in FY2014 and $200 million in FY2015. The idea of an innovation fund for reform in Ohio is something the Fordham Institute, Ohio Grantmakers Forum (OGF),[1] and other reformers have been urging since at least 2008. For example, in the OGF report Beyond Tinkering: Creating Real Opportunities for Today’s Learners and for Generation of Ohioans to Come[2], issued in early 2009 and the result of months of input from philanthropy around the state, the first recommendation called for creating “Ohio Innovation Zones and an Incentive Fund.” Specifically, the report called for “an Incentive Fund to seed transformative educational innovation, support and scale up of successful educational enterprises, and build a strong culture to support these activities in local communities and throughout the state’s system of public education.”

Further, Beyond Tinkering argued that the purpose of the innovation fund should not be simply incenting new programs, but pushing reforms that ultimately lead to greater...

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Plenty of folks in the education business seek the limelight. Not all deserve it—at least, not for doing good. But some individuals and groups that do great good for kids, teachers, and schools prefer to do so quietly, even invisibly. And two such entities are merging as Gene Wilhoit—previously of the Council of Chief State School Officers and, arguably, the most important force behind the Common Core standards—joins Sue Pimentel and Jason Zimba’s crackerjack (but small and quiet) team at Student Achievement Partners, which might be the most valuable enterprise in the land when it comes to defending, improving, explaining, and implementing the Common Core. Neither Wilhoit nor SAP is a glutton for publicity—but the work they’ve done, and continue to do, deserves respect and gratitude.

Earlier this week, Ohio Governor John Kasich unveiled his education reform plan. Among its many features are an expansion of private school vouchers and Ohio’s first-ever charter school facility funding. Perhaps most promising, the governor proposed a $300-million Innovation Fund to kick-start projects aimed at reshaping how schools deploy technology and human resources. In a town-hall meeting, Fordham's Terry Ryan told the governor and a rapt audience that the Innovation Fund is "very exciting...There's a lot of untapped energy out in the field that's waiting to take charge and take control of the opportunities."

As school districts begin to come to terms with the fact that they will not be able to maintain their current spending levels, Stanford scholar Eric A....

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Bill Gates just released his foundation’s annual letter, and he summarizes the edu-important parts here. He focuses on the findings of the gigantic MET study. While I’m happy that he is personally publicizing what they learned about teacher effectiveness, this short piece only underscores the concerns I raised here. Implementing the study’s findings is the tough part, but his only reference to that is a glancing blow about budgeting. I really hope they have a detailed, coordinated plan in place.

Check out a smart piece by Checker on the very important issue of cut scores for common assessments. This is one of the issues that, if mishandled, may contribute to the centrifugal force pulling the testing consortia—and Common Core—apart. (Cost may prove to be another.) If you think I’m mother hen-ing this thing, consider Alabama’s recent decision to drop out

According to Politics K–12, a number of House GOP leaders are charging that the Administration is standing in the way of students hoping to participate in the D.C. scholarship program. This program, which allows a small number of D.C. kids to choose nonpublic schools, seems to always be on its last legs. Kudos to Speaker Boehner et GOP al. for continuously patching it up and fighting for the kids it might serve. As my book, The Urban School System of the Future, shows, there is wide variation in the quality...

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