By THOMAS GENTZEL
As the end of the school year approaches, tests are being taken, assignments turned in and graduation ceremonies are plentiful. Typical for the season, but behind the scenes, boards of school directors are trying desperately to balance budgets for the coming year that in many cases are in deficit by millions of dollars. Sadly, this scenario is becoming more frequent each year as Pennsylvania pulls back on its obligation to adequately fund public education. Money may be tight, but the state's priorities must be set straight.
Currently, some state officials are criticizing school entities for saving money for future costs something that any financial adviser would recommend. Prudently, school entities have anticipated the pension tsunami which will increase dramatically in the near future by setting aside money to pay the obligated employer share. The Public School Employees Retirement System (PSERS) has projected the employer contribution for 2012-13 at approximately $515 million, a 45% increase, and for 2014-15 at approximately $528 million, a 40% increase. A recent survey by the PA Association of School Business Officials and PA Association of School Administrators shows that districts expect to use three times more fund balance in 2012-13 as used for the current year, much of it for pensions. Unfortunately, while they may have planned for the pension increases, many districts have been caught in a combination of poor economy, cuts in state funding and lagging local tax revenue. Their fund balances are gone or depleted to dangerously low levels.
Fortunately, all is not lost. Even without money in hand, policymakers do have many options at their disposal to help financially strapped districts across the state without any additional funds needed. I would like to highlight two.
1) Charter school expenses should be fair and equitable: Currently schools pay charter and cyber charter school expenses at varying rates. In other words, charters and cyber charters are getting different payments for students from different home districts (sometimes differences of thousands of dollars). Is the education those students receive different? No, so why should the payment?
Additionally, the formula for payment to charters includes non-instructional fees such as athletic funds and facilities. These costs should be eliminated from what districts must pay, especially to cyber charters that don't have the typical expenses of bricks-and-mortar schools. More alarmingly, the resident school district's cost for school employee retirement expenditures is not subtracted from the payment even though charters are guaranteed by state law to be reimbursed by the commonwealth for at least 50% of its retirement costs, setting up a "double-dip" for charters. From now through 2016-17, charters will have received an additional $500 million as a result of being paid twice for these expenses and taxpayers are the ones putting up the cash. Charter and cyber charter funding formulas must be reflective of actual instructional expenses, predictable and based on logic. Currently, they are not.
2) Eliminate unfunded mandates that do not directly impact the classroom: If schools are being required to do more with less, then they need the tools to do so through meaningful mandate relief. One of the most onerous is prevailing wage, which increases building and renovation project costs by 10, 20 even 50%. Currently, prevailing wage must be paid for all public construction jobs costing more than $25,000 including school construction and renovation projects. Proposed state legislation would raise the threshold to $185,000. A good start, but completely eliminating prevailing wage should be the ultimate goal. Private industry is not required to pay prevailing wage costs to build. Why should taxpayers be forced to pay for an escalated cost of public construction projects in this state?
Nearly 90% of students in Pennsylvania are enrolled in public education, yet most of the attention these days seems to go to redirecting resources away from those children. In the survey results mentioned earlier, 60% of the districts report they will increase class sizes in the coming year; 58% will reduce instruction in art and music, physical education, and offer fewer electives and advanced placement course offerings; nearly 50% will delay textbook purchases; 37% are cutting tutoring programs; 34% are eliminating summer school; and 19% will reduce research-proven early childhood education programs such as full-day kindergarten.
The impact of these cuts will be felt most immediately by students and parents. However, it won't be long before all of us feel the pain through lack of competitiveness nationally and globally. Businesses want an educated workforce in the communities where they decided to locate, provide wages and pay taxes. Without this, they may decide to do business in other states. With some policy changes like the ones I mention above, we can make sure money is spent wisely and directed to where it is most needed, our public schools.
Gentzel is executive director of the Pennsylvania School Boards Association.
