With the mid-term elections upon us, there is much debate lately about whether K12 school funding is up or down. Both sides claim that they are ‘right’ (GOP: increase in funds; Democrats: decrease in funds).
The CRC issued Memo 1130 today that does a nice job detailing the macro level truth. Please find the report here. Briefly:
- There has been an increase in K12 funds, but not to the classroom. Increases have gone to off-set the rising legacy retirement costs, which further escalated with the economic downturn in 2008.
- Changes in use of the School Aid Fund for higher education, MBT Reform and other reductions in revenue have reduced funding that can be used for the K12 classroom setting by $1.8B.
- Since funds follow the student in Michigan, to the extent that student enrollment declines, funding also declines. Most districts in Michigan have experienced a decline in enrollment, also exacerbated by lifting the cap off of charters such that there are >300 in Michigan now; the vast majority being for profit since they do not have to pay into MPSERS.
This report largely reflects our presentation to the SBE in June, where we documented the signficantly decreasing amount of funds that can be applied to the classroom.
The CRC memo does not address inflation-adjusted dollars. If we were to include those adjustments, which we did, the real dollar impact of declining funds is even more significant. Please find the full presentation here.
