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Lesson 8.9

More Money for Education:
What Are the Options?

School donations are great, but…

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California's funding for education is quite low relative to other states. What can be done?

In about 2005, a coalition of education funders pooled their efforts to sponsor "Getting Down to Facts," an ambitious research effort that sought to give clear advice to the Education Excellence committee, an expert panel charged with recommending changes consistent with the research. Among the committee's main recommendations was a call for a thorough revamp of California’s school funding system. Much of this recommendation was accomplished in 2013 with passage of the Local Control Funding Formula (LCFF). The committee also urged lawmakers to find a way to add several billion dollars to the state education budget. When the “great recession” hit, K-12 funding was not increased but cut dramatically instead, with a reduction of about 20% between 2008 and 2012.

California schools are not within bake-sale distance of nationally normal funding

Thanks to an improving economy and voter approval of temporary tax increases in the fall of 2012, school funding stabilized and began to rise, and in 2015 the state budget for education for the first time exceeded its pre-recession high. However, part of the purpose of LCFF is to distribute more of the increases in state funding to the districts that serve the highest numbers of low-income and English learner students. To achieve this, the new system keeps the “base funding” level per pupil (the amount that is not based on need) relatively low. If state tax receipts grow as projected at the time of LCFF's design, districts with few “high need” children will not see their funding restored to 2008 levels until about 2021. That is in dramatic contrast to a district with most of its students identified as disadvantaged, thus qualifying for extra funding.

Advocates for adequate education funding want to see more money put into California’s system as a whole, as was recommended back in 2007. (See Lesson 8.2 for a discussion of what more funding could be used for.) The seeds of the next school funding crisis may have already been sown; the tax increases passed in 2012, when voters approved Proposition 30, will expire in 2018, reducing the state general fund and school funding by billions.

So what options are open to Californians for increasing the funding available to support schools?

Communities can donate to their schools

Voluntary donations cannot match the funding power of a tax.

Let's start with the obvious. When times are tough and school funding suffers, people who care pull together to raise whatever money they can for their students. This happens all over California. Some wealthier communities can raise hundreds of dollars or even more per student. Some schools tell their parents that a significant annual donation is an expectation. Others hold a wide variety of fundraising events.

How much is a "normal" amount of fundraising for a school? No one really knows.

Data about local donations to school-related nonprofit organizations are not collected or reported in a consistent way, and it is quite literally impossible to know how much is raised and how the funds are used. Some schools and school districts have established local education foundations. Others depend on their local PTAs and other parent organizations to provide money for everything from field trips to extra staff to extra stuff. But even in the wealthiest communities, donations cover at most the cost of a few salaries per school.

California schools are not within bake-sale distance of nationally normal funding. Voluntary donations cannot match the funding power of a tax. But under current California law, communities have few options for taxing themselves to support their schools.

Voters or lawmakers could raise statewide taxes

Voters have provided revenue for education, especially by voting to tax the wealthy. In 2012 California voters passed Proposition 30, a temporary to provide support for education and other services. The collapse of the stock market in the Great Recession had dramatically reduced funds for education, and Prop 30 headed off major cuts. The taxes created by prop 30 were temporary, but popular. In 2016 voters renewed the taxes by passing Proposition 55. The tax does not apply to most taxpayers, as it is levied only on incomes in approximately the top 1% in the state.

The Legislature also has the authority to increase taxes, but has not tended to do so. Governor Jerry Brown, who supported both Prop 30 and Prop 55, campaigned on the promise that any state tax increases would be subject to a popular vote.

Taxation in California is a multi-faceted issue that goes well beyond the scope of Ed100, but it affects our schools dramatically. If you’re interested in learning more about all the issues that confront California, the CA2025 project from the Public Policy Institute of California (PPIC) is a great place to start.

The other statewide strategy for increasing money for schools is through the courts.

The Courts could require more funding

The judicial branch has played a major role in school finance. States have a constitutional obligation to ensure that schools exist, but at what level of quality? Through litigation, courts have become key players in the debate about what it means to fund schools rationally, adequately and equitably. Among the goals of such litigation is to define a minimum funding “floor” for education funding. Two such "adequacy" cases were initiated in California in 2010. Thus far, the courts have found there is “no support for finding implied constitutional rights to an education of 'some quality' for public school children or a minimum level of expenditures for education…" Education-related litigation can be difficult to track; readers with an interest in this strategy for change might be interested in EducationJustice.org, which seems to provide useful summaries of the progress of cases.

In some ways, this top-down approach is a continuation of a 30-year trend toward centralization of the school system. Local revenue raising provides only a small countervailing alternative.

Californians could amend Proposition 13

The elephant in the room is property taxes, which no longer provide the bulk of funding for schools. Proposition 13 remains popular, especially among Californians who have owned property long enough for it to have gained in value. Owners of commercial property, for example, pay a much lower share of total property taxes than was true in 1978. But companies that buy new properties face a much higher cost of doing business than incumbents. Homeowners face similar inequities. The Silicon Valley Community Foundation commissioned a major review of Prop 13 in 2013.

A growing number of proposals, both in the Legislature and among community groups, have recommended some reforms of this once nearly sacred law. Both the state assembly and state senate have a “Committee on Revenue and Taxation” looking at these issues. The extent to which schools would benefit from such reforms remains to be seen.

Voters prefer local solutions

Survey results show that Californians are more supportive when taxes are local, in support of local schools. Solid majorities (roughly six in ten) say they would support a local parcel tax to support schools in their community. In this case, however, the will of the majority is not enough: Proposition 13 amended the California constitution in 1978 so that it requires local governments, including school districts, to get 2/3 voter approval to pass special taxes. It also prohibited school districts from raising property taxes based on the value of property ("ad valorem" taxes), except for issuing General Obligation Bonds for facilities.

For school districts, the other exception was parcel taxes, which are levied on the basis of ownership of a parcel of land, independent of its value. Lesson 8.10 goes into more detail about parcel taxes.

The question of adequate funding for schools is likely to remain a hot topic in California. Check Chapter 10 and the Ed100 blog for discussions and proposals.

Review

Education costs thousands of dollars per student per year. In a typical school in California, how much of that cost is covered through donations?

Answer the question correctly and earn a ticket.
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Questions & Comments

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user avatar
Jeff Camp - Founder June 28, 2016 at 12:08 am
Superb study by PPIC of voluntary giving to schools through their PTAs, PTOs, booster clubs and other sources. This kind of information isn't easy to get! The overall numbers per pupil are quite small, even in rather wealthy districts and schools. The authors (Weston et. al.) conclude that voluntary giving only modestly offsets the redistributional impact of LCFF on wealthier districts. http://www.ppic.org/content/pubs/report/R_1015MWR.pdf
user avatar
Carol Kocivar June 10, 2016 at 2:17 pm
The Right to a “Quality” Education
In many states across America, courts have played an important role in determining whether funding for public education is adequate. So far, in California, the courts have said, “NO. This is not something for the courts. The legislature has to deal with this.”
Learn more in our blog about the issue of whether California’s low funding is unconstitutional?
/the-right-to-a-quality-education/
user avatar
Carol Kocivar January 29, 2016 at 3:53 pm
Up-Date on Court Adequacy Cases
Oral arguments in Robles-Wong v. California took place in the Court of Appeal in San Francisco on Wednesday, Jan. 27, 2016. Plaintiffs in this case include three statewide education associations (CSBA, ACSA and CA PTA), nine school districts, and approximately 60 individual students and their families.
Robles-Wong is designed to clarify the State’s constitutional obligation to fund an educational system that provides all students the education they need to compete and succeed in our global economy.
http://edsource.org/2016/california-lawsuit-appeal-pursues-claim-of-inadequate-education-funding/94008?utm_source=Jan.+28+daily+digest+--+Jane&utm_campaign=Daily+email&utm_medium=email
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