Arts on Line Education Update March 9, 2015

Ohio Alliance for Arts Education
Arts on Line Education Update
Joan Platz
March 9, 2015

1)  Ohio News

•131st Ohio House:  The Ohio House and Senate will hold hearings and sessions this week.  The schedule of hearings is included under “This Week at the Statehouse.”

•Senate Approves Safe Harbor Bill:  The Ohio Senate approved HB7 (Buchy) unanimously on March 4, 2015.  The bill ensures that the scores on the new assessments developed by the Partnership for Assessment of Readiness for College and Careers (PARCC) in math and English language arts, and AIR in science and social studies, do not affect decisions about student promotion, retention, or credits for classes. The bill, however, doesn’t impact retention guidelines tied to third grade reading test results.

The Senate Education Committee amended the bill to clarify that schools/districts would not lose state aid if students didn’t take state assessments.  The bill was also amended on the floor of the Senate so that students would not lose their voucher if they also refused to take the state assessments.  The bill now goes back to the House for concurrence.  The bill passed with an emergency clause, so that it can go into effect before the end of the school year.

•Senate Forms Advisory Committee on Testing:  The Senate announced on March 4, 2015 the formation of the Senate Advisory Committee on Testing to study student testing in Ohio and develop recommendations for lawmakers to consider before the summer recess at the end of June. The committee will be chaired by Senator Lehner, chair of the Senate Education Committee.  The committee roster includes the following individuals:

Teachers: Dar Borradaile, Miami Valley Career and Technical Center; Melissa Cropper, Georgetown Exempted Village Schools; Amy Holbrook, Mad River Local Schools; Kimberly Jones, Columbus City Schools; Shari Obrenski, Cleveland City Schools; Billie Sarich, Grandview Heights City Schools; and Kay Wait, Toledo City Schools.

Superintendents: Adrian Allison, Canton City Schools; Jan Broughton, Fairfield Union Local Schools; April Domine, New Albany Plain Local Schools; John Marschhausen, Hilliard; Keith Millard, Hamilton City Schools; and Paul Imhoff, Upper Arlington City Schools.

Curriculum and testing specialists: Cheryl Irish, Miami University; Machelle Kline, Columbus City Schools; Jim Mahoney, Battelle for Kids; Char Shryock, Bay Village Schools; and Julie Sellers, Cincinnati City Schools.

State Board of Education: Michael Collins and C. Todd Jones

Educational experts: Earl Oremus, Marburn Academy; Andy Boy, United Schools Network; Jessica Voltolini, Ohio Department of Education; and Chris Knight, Catholic Schools, Diocese of Toledo.

Legislators: Senator Peggy Lehner; Senator Cliff Hite (R-Findlay); and Senator Tom Sawyer (D-Akron).

Parents:  To be named later.

•ODT Changes Formula for Agricultural Valuation:  According to the Ohio Farm Bureau, the Ohio Department of Taxation announced on March 6, 2015 changes in the Current Agricultural Use Value (CAUV) formula that could lead to lower valuations for farmland in Ohio.

Since the beginning of the 2009 recession, the value of agricultural land has increased while the value of land in urban and suburban areas has decreased in Ohio.

This is because the value of agricultural land is determined based on a complex formula that incorporates factors such as soil type, cropping history, crop prices, yields, non-land production costs and interest rates, and provides more stability for agricultural land values compared to residential and commercial real property.

The new CAUV formula includes modifications to the Capitalization-Interest Rate and woodland values that could lower valuations of farm land, and decreases the lag time for retrieving some data, which will improve its accuracy.

The change in CAUV formula has implications for the proposed state funding formula for school districts in HB64 (Smith) Biennial Budget.  The proposed school funding formula determines the school district’s local contribution through the State Share Percentage which considers property valuation as one of the factors, along with median income, to determine school district wealth.  Dr. Howard Fleeter, an economist at the Ohio Education Policy Institute, told the House Finance Subcommittee on Primary and Secondary Education on March 5, 2015 that CAUV was one of the factors that contributed to rural school districts seeming wealthier in the formula, thus leading to a decrease in state aid for these districts.

See http://ofbf.org/media-and-publications/news-room/734/

•Charter School Web Site:  Innovation Ohio announced last week that the Charter School Accountability Project has updated data on the KnowYourCharter web site to include school information in addition to school district information. Comparisons can now be made between school districts, public schools, and/or charter schools in the areas of academic achievement and finances. The project is a collaboration between Innovation Ohio and the Ohio Education Association. See http://knowyourcharter.com/school-performance/

2) This Week at the Statehouse

•The House Finance Subcommittee on Primary and Secondary Education, chaired by Representative Cupp, will meet three times this week to receive testimony on HB64 (Smith) Biennial Budget:

On Monday, March 9, 2015 at 1:00 PM in hearing room 116 the subcommittee will receive
testimony from the following:
– Agudath Israel of America
– Catholic Conference of Ohio
– Ohio Association of Independent Schools – School Choice Ohio
– Buckeye Christian School Association

On Wednesday, March 11, 2015 at 4:00 PM in hearing room 116 the subcommittee will receive testimony from the following:
– Ohio Alliance for Public Charter Schools
– Ohio Association of Charter School Authorizers – Ohio Coalition for Quality Education
– Breakthrough Schools
– Buckeye Charter School Boards

On Thursday March 12, 2015 at 9:00 AM in hearing room 116 the subcommittee will receive testimony from the following:
– Ohio Association for Gifted Children
– Ohio Coalition for the Education of Children with Disabilities
– Ohio Association for Career and Technical Education
– Ohio Association of Career-Technical Superintendents
– Ohio STEM Learning Network
– Ohio ESC Association
– Ohio Education Computer Network

•The House Education Committee, chaired by Representative Hayes, will meet twice this week to receive testimony on HB74 (Brenner) Primary-Secondary Assessments and HB2 (Dovilla/Roegner) Charter School Sponsorship:

The committee will meet on Monday March 9, 2015 at 4:00 PM in hearing room 121 and on Wednesday, March 11, 2015 at 8:00 AM in hearing room 018.

•The Senate Education Committee, chaired by Senator Lehner, will meet on Tuesday, March 10, 2015 at 4:00 PM in the Senate Finance Hearing Room.   The committee will receive testimony from teachers regarding State Superintendent Richard Ross’ report on testing and assessment.

•The Ohio Constitution Modernization Commission’s Committee on Education, Public Institutions, and Local Government will meet on Thursday, March 12, 2015 at 9:30 AM in hearing room 017.  The committee will receive a review of proposals on the “thorough and efficient” clause from senior policy adviser Steven Steinglass.

3)  State Board of Education to Meet:  The State Board of Education, Tom Gunlock president, will meet on March 9 & 10, 2015 at the Ohio Department of Education Conference Center, 25 South Front Street in Columbus.

On Monday, March 9, 2015, the Board will conduct a Chapter 119 hearing on two rules:  Rule 3301-42-01, Criteria for Enrolling Eligible Adults in Public Secondary Education Programs, and Rule 3301-102-10, Drop-out Recovery Performance Ratings.

The Achievement and Graduation, Capacity, Urban Renewal, and Accountability committee meetings will follow.

After lunch at about 1:00 PM the Board will receive an update from the Superintendent of Public Instruction on HB64 (Smith) Biennial Budget.

Public participation on agenda and non-agenda items is scheduled for 3:00 PM, followed by the State Board’s Business Meeting.  The Board will move into executive session and will recess following the meeting.

On Tuesday, March 10, 2015 the State Board will reconvene at 8:30 AM.  The Board will receive a Welcome Poem by Lake Wilburn, the 2014 Poetry Out Loud State Champion.  The Board will then take action on the Report and Recommendations of the Superintendent of Public Instruction, consider old business and new business, and adjourn.

At the March State Board of Education Meeting, the Board will consider the following resolutions:

#4 Approve a Resolution of Intent to Amend Rules 3301-32-3301-32-01, 3301-32-02, 3301-32-04 TO 3301-32-06, and 3301-32-08 to 3301-32-12 of the Ohio Administrative Code Regarding School Age Child Care Programs. (Volume 2, page 13).

#5 Approve a Resolution of Intent to Amend Rule 3301-35-15 of the Ohio Administrative Code entitled Standards Concerning the Implementation of Positive Behavior Intervention Supports and the Use of Restraint and Seclusion. (Volume 2, page 49)

#6 Approve a Resolution of Intent to Consider Confirmation of the Cincinnati City School District’s Determination of Impractical Transportation of Certain Students Attending Immaculate Heart of Mary School, Cincinnati, Hamilton County. (Volume 2, page 58)

#14 Approve a Resolution to Amend Rules 3301-19-01, -02, and -03 of the Ohio Administrative Code regarding Expenditure Flow Reports. (Volume 3 page 239).

#15 Approve a Resolution to Adopt Rule 3301-24-10 Entitled Alternative Pathway to Professional Principal License for the New Leaders for Ohio Schools Pilot Program. (Volume 3, page 239).

#16  Approve a Resolution to Adopt Rule 3301-24-23 and 3301-24-24 of the Ohio Administrative Code entitled Resident Educator License Renewal and Alternative Resident Educator License Renewal. (Volume 3, page 242).

#17 Approve a Resolution to Adopt New Rules 3301-24-25 and 3301-24-26 of the Ohio Administrative Code entitled Senor Professional Educator License Renewal and Lead Professional Educator License Renewal.  (Volume 3, page 249)

#18 Approve a Resolution to Amend Rule 3301-27-01 of the Ohio Administrative Code entitled Qualifications to Direct, Supervise, or Coach a Pupil Activity Program. (Volume 3, page 257).

#24 Approve a Motion to Permit Board Members to Seek Reimbursement for Meals in Connection with Travel in Accordance with OBM Travel Rule 126-1-02. (Volume 4, page 4).

#25 Approve a Resolution to Revoke the Charter of Phoenix, Akron, Ohio.  (Volume 4, page 13)

#26 Approve a Resolution to Designate Selected Science Advanced Placement and International Baccalaureate Exams as Substitutes for the State’s Biology End of Course Exam. (Volume 4, page 19)

#27 Approve a Resolution to Designate Graduation Points Earned Based Upon Scores on the Substitute Exams. (Volume 4, page 26).

#28 Approve a Resolution Finding Portage County Educational Service Center is Non-Compliant with its Community School Sponsorship Obligations.  (Volume 4, page 28).

Please Note:  Resolution #19, to rescind and adopt Rules 3301-35-01 through 3301-35-10 of the Ohio Administrative Code regarding the Operating Standards for Ohio School Districts and Elementary and Secondary Schools, has been pulled from the March voting agenda.

4)  State Auditor Proposes More Amendments to Charter School Law:  The House Education Committee, chaired by Representative Hayes, continued to receive testimony on March 4, 2015 on HB2 (Dovilla/Roegner), a bill that focuses on charter school governance and accountability. State Auditor Dave Yost and representatives of the Ohio 8 school districts presented oral testimony, while the Ohio School Boards Association, Buckeye Association of School Administrators, and the Ohio Association of School Business Officials submitted written testimony.  The committee expects to meet next week to accept amendments, and plans to vote on the bill possibly March 11, 2015.

State Auditor Yost told the committee that since 2001 the State’s auditor’s office has issued findings for recovery in 309 audits of charter schools totaling $27 million, and 22 people associated with charter schools have been convicted of criminal wrongdoing.

He then offered the committee recommendations to improve charter school law in the areas of accountability, finance, and governance:

Accountability

-Change current law to require charter schools to comply with the same laws about truant students as traditional public schools in Section 2152.02(D) chronic truant.  Currently charter schools follow different laws to dismiss students who are truant than traditional public schools.  Traditional public schools follow Section 2152.02(D) chronic truant, which is defined as any child of compulsory school age who is absent without legitimate excuse from public school for seven or more consecutive school days, ten or more school days in one school month, or fifteen or more school days in a school year. Charter schools must withdraw a student who misses 105 unexcused consecutive hours of school.  But, if a student returns to school after missing 104 hours, the clock starts again.  This means that it is possible for a charter school to receive funding for a student who attends school for as few as 10 days.

-Clarify and define blended learning and internet-based schools so that there is assurance that the schools are providing the equivalent of the required 920 hours of instruction. Auditor Yost told the committee that his office cannot verify if online charter schools and those that are using blended learning are meeting the 920 hours of required instruction.  “Like so much else in the Department of Education, it is taken on faith, on an honor system.”

He also called for independent evaluations of the components of online learning and suggested that the highest rated sponsors supervise schools using blended learning.

-Require that charter school treasures have a fiduciary duty to the school’s board, and allow a sponsor to stand in for the school board as plaintiff if the school board is otherwise unable to maintain an action for recovery.

Finance:  Counting Students

-Allow the Ohio Department of Education (ODE) to have access to the identities of individual students to address the problem of multiple SSID numbers being generated by charter schools. Ohio is one of two states that do not allow their departments of education to collect data including students’ names, addresses, and social security numbers.

Finance:  Facilities

-Place a lien on a charter school building representing the proportional risk actually assumed by the State for a certain amount of time. “Education of our children ought not be a back-door means to acquire real estate.”

Finance:  Reporting

-Require charter schools to change their accounting and reporting model to the government model, which is the model used by traditional public schools. This change could be phased-in over a year.  This change would allow for “more apt comparisons between educational sectors.”

-Expand the level of information currently reported in the “twenty percent” footnote.  This is a narrow footnote added to a financial report of a charter school in which most of the funding goes to a management company.  The CPA firm that audits the private management company adds the footnote.  The recommendation calls for the level of information currently reported under USAS by traditional public schools. “This compromise protects the agility, privacy and trade secrets of a private company while still providing substantially more information about how public money is spent.”

Governance

-Eliminate ODE’s role as a sponsor of charter schools.  “In particular, ODE’s role should be explicit. Is it a sponsor, a coach, a regulator, a funder, a licenser? In part, ODE’s muddled role in community schools is a by-product of its muddled role in education in general.”

-Phase-out the authority of local school districts to sponsor their own conversion schools.

-Provide the ODE more details about the requirement in law to rank sponsors. (129-HB555)

-Create incentives for high-performing sponsors.

•Testimony from the Ohio 8:
Superintendent Lori Ward, Dayton Public Schools and Kevin Dalton, Toledo Federation of Teachers, testified on HB2 on behalf of the Ohio 8 school districts.  They said that the Ohio 8 supports the charter school provisions in HB2 and the Executive Budget, but recommended that specific information be added to the bill about public audit requirements and the process for opening a closed charter school.

To increase transparency the Ohio 8 recommends establishing requirements that the annual audit include the receipt, transfer, and expenditure of all public funds; the names of board members, treasurer, CFO, etc. be posted online; conflict of interest statements be made available online; assets acquired with public dollars be returned to local educational agencies; teacher and administration salary schedules and total expenditures be disclosed.

They also suggested that a closed charter school be prohibited from reopening if the new school has the same sponsor as the closed school; the new school has the same chief administrator as the closed school; fifty percent or more of the governing authority of the new school consists of the same members as the closed school; fifty percent or more of the teaching staff of the new school consists of the same individuals who were teachers at the closed school.

7) Subcommittee Hearing Focuses on the School Funding Provisions in HB64:  Statewide education organizations weighed-in on Governor Kasich’s new formula and plan for funding schools included in HB64 (Smith) Biennial Budget on March 5, 2015, and all agreed that the state could do more to support its public schools.

Testifying before the House Finance Subcommittee on Primary and Secondary Education, chaired by Representative Cupp, were the following individuals and organizations:
•Russ Harris, Government Relations Division, Ohio Education Association (OEA)
•Melissa Cropper, President of the Ohio Federation of Teachers (OFT)
•Bill Phillis, Executive Director of the Coalition for Equity and Adequacy of School Funding (E & A Coalition)
•Thomas Tucker, Superintendent of Worthington School District
•Tom Hosler, Superintendent of Perrysburg Schools
•Jenni Logan, Treasurer of the Lakota Local School
•Linda N. Reid, Superintendent South Euclid Lyndhurst Schools

•Damon Asbury from the Ohio School Boards Association (OSBA), Barbara Shaner from the Ohio Association of School Business Officials (OASBO), and Tom Ash from the Buckeye Association of School Administrators (BASA) presented joint testimony.

In addition, Dr. Howard Fleeter, from the Ohio Education Policy Institute presented to the committee an analysis of the components of the formula.  A summary of his analysis and recommendations is included below.

The following are some of the key issues and themes identified by witnesses during the testimony:

•The state has failed to provide a stable school funding formula:
Representatives from BASA, OASBO, and OSBA told the committee that there have been at least five different school funding formulas since the DeRolph school funding decision was issued by the Ohio Supreme Court in 1997. In general these formulas have attempted to address the many diverse needs of students across the states, but the “…current school funding formula established in HB59, and the proposed changes contained in HB 64, still fall short in meeting the needs of all students.”

Thomas Tucker – Worthington asked the committee to “adopt the current formula as the foundation for your deliberations and fully fund it to meet the needs of Ohio’s 1.7 million public school students.”  He said that a “stable, permanent formula for providing the right amounts of state aid to meet varying needs is essential”.

•The state funding levels are inadequate even though the state is projecting a budget surplus:
Some witnesses told the committee that the proposed levels of state aid for K-12 education in FY16-17 were about the same as the funding levels districts received in 2010-11, and asked that the projected budget surplus be used to increase state aid for schools.

Representatives from OSBA, OASBO, and BASA told the committee that an analysis of the proposed formula has identified “wide gaps in available resources for some districts.”

Russ Harris-OEA said that the proposed budget supports a modest increase of $460 million over the biennium, but with “growing state revenues, this is the time to make investments in our future to address the shortfall in state funding for public education.”

Bill Phillis- E&A Coalition reported to the committee, “The proposed state budget increase of $459 million for the next biennium will position school funding about where it was in the FY 2010 and FY 2011 biennium. An additional concern is that the transfer of funds from districts to choice programs in FY 2016 and FY 2017 will be at least $500 million more than in FY 2010 and FY 2011.”

•School districts are relying more on local tax revenue:
According to some witnesses overreliance on local property taxes has increased over the past few years, in direct opposition to the Ohio Supreme Court directive in the DeRolph school funding decisions.

Tom Hosler – Perrysburg told the committee that rating agencies such as Standard & Poor’s and Moody’s Investment Services rate Ohio’s schools lower, because increasingly districts must go to the voters to seek operational dollars, and they consider that an unstable form of funding.

Melissa Cropper-OFT said that it is becoming more difficult for families to reach into their own pockets to afford levies.

•The components of a high quality education should be determined and the resources allocated:
Some witnesses stated that the proposed funding levels for K-12 education in HB64 are determined through residual funding, in which the state determines the total spending, and backs into the per pupil amounts.

Bill Phillis-E & A Coalition asked the committee to consider,  “What is the premise of the current school foundation program level of $5,800 per pupil? On what is that number based?” And, “What is the rationale for the level of funding for the line item appropriations and subsidies or the absence of line items? For example, why is there not a line item for school bus purchase as was the case two decades ago?”

Representatives of OSBA, BASA, and OASBO recommended that, “Ohio’s school funding formula should be calibrated in such a way that allows every district to prepare its students for college or a successful career. We believe the current funding formula (adopted in HB 59) and the proposed changes in HB 64 have made progress, but fall short of this objective.”

•The purpose of school district balance reserves is to ensure sufficient revenue between levies:
The Kasich administration has suggested that school districts that could lose state funding due to the proposed new funding formula in HB64 make-up losses by using their spending reserves.  But witnesses told the committee that would not be prudent.

Russ Harris-OEA said that the balances are not “unencumbered” resources, but necessary to carry the financial burden until the next levy.

Representatives from OSBA, BASA, and OASBO said “….that there are valid reasons for districts’ carryover balances, including cash flow protection for future expenditures, levy management, and concerns about future reductions in state and local revenue.”

Tom Hosler – Perrysburg’s Schools explained to the committee the relation between the reserve fund and bond ratings.  When he tried to upgrade his district’s bond rating, Moody’s Investors Service in Chicago said that his cash reserve would need to be at least 25 percent of the annual budget to get an upgrade, even though his district demonstrated strong management practices.

•The new formula doesn’t redistribute state aid based on capacity to raise revenue locally:
Russ Harris explained that it appears that the new formula makes less wealthy rural districts with low student population and lower income levels look wealthier.

Jenni L. Logan – Lakota Local School District said that her district will lose $9.7 million in state aid through the new formula, and will be forced to return to the ballot or make cuts, after making $20 million in cuts between 2010-2013.  She went on to explain that the proposed formula is designed to adjust for a district’s ability to raise local revenue, but what also should be considered is tax effort.  Lakota’s effective millage rate is 16 percent higher than the state average, meaning that the residents of the district are already exceeding the fiscal effort standard.

•The new way to count students causes instability:
This is the first year that school districts will report student counts three times per year in October, March, and June, rather than during one week in October.  State funding for schools will be adjusted based on the adjusted enrollment in June, after the school year is over, and expenditures are finalized.

According to testimony from representatives of OSBA, BASA, and OASBO this new policy “creates instability for districts. Not only have they set their budgets and programs at the beginning of the school year based on the number of students enrolled, an adjustment in the last payments of the year could be problematic.”  They recommend that the June adjustment be carried-over to the following school year to provide more stability.

•The number of school districts on the guarantees (transitional aid) is the result of inadequate state aid:
According to Russ Harris-OEA and representatives from OSBA, BASA, and OASBO, the number of school districts on the guarantee in FY16 is 226 districts and 184 districts in FY17. The major reason, as explained by Howard Fleeter from the Ohio Education Policy Institute, is the “overall inadequacy of the funding formula” rather than enrollment or changes in property value.

•The loss of tangible personal property tax revenues affect many districts.  According to the testimony by Russ Harris – OEA, there are about 200 school districts that have been negatively affected by the loss of tangible personal property tax revenues. The proposed formula in HB64 would re-activate a phase-out of the Tangible Personal Property and Public Utility Tangible Personal Property Tax replacement payments to school districts.

Representatives from OSBA, BASA, and OASBO testified that many districts that receive these payments are also seeing reductions in transitional aid, and “would have extreme difficulty in raising the lost revenue locally.”

•Funding for charter schools and vouchers should not be a deduct from school districts:
Some witnesses asked the committee to change the way charter schools are funded. Currently the state deducts from school district accounts the full per pupil amount ($5800) plus categorical aid even if the district only receives a portion of the per pupil amount in state aid.

Linda Reid-South Euclid Lyndhurst Schools (SEL) explained that her school district receives only $1,350 out of $5800 per student in state aid, but, “…for every student that leaves the SEL district and enters a charter school $4,400 is made up through local tax dollars. SEL Schools pay more in local dollars to charter schools than is deducted from the state foundation on a per pupil funding basis.”

She added that, “the $5800 is the base cost per student from the state. It does not consider any additional costs that may be incurred for transportation services, special education services or other cost-related services; so in some cases the amount of money leaving the district could be closer $7,000.”

According to Russ Harris-OEA nearly $1 billion is being diverted from the public school system to charter schools in the 2014-15 school year, and as a result of charter school deducts, only 200 school districts will realize an increase in state aid this year.

Bill Phillis-E & A Coalition recommended that, “The effectiveness of the choice programs and the impact of the revenue removed from school districts should be subjected to intense legislative review. Since there are major fiscal implications for all students, this is a matter that should be addressed in HB 64.”

Other organizations, including OSBA, BASA, OASBO, OFT, and OEA opposed the expansion of the Cleveland voucher program and increasing the voucher amount for high school.

Melissa Cropper -OFT told the committee, “Ohio has too many voucher programs as it is. Data shows little difference between the performance of voucher students and their peers who remain in traditional public schools. OFT conducted a poll last year and results show that parents prefer the state focus on providing excellence in all public schools, not choice. All vouchers programs – except the income-based voucher – drain resources from traditional public schools. Ohio already provides funding to private schools for auxiliary services. There is no public demand for vouchers, yet Ohio’s traditional public schools have a great need for additional funding.”

•Charter schools should not receive funding from a local levy:
Most witnesses said that they didn’t support a provision in HB64 that allows community schools with “exemplary” sponsors to partner with the resident school district to receive funding from a local tax levy. Boards of education would have to approve the community school levy before it could be posed to the voters.

As explained by representatives from OSBA, BASA, and OASBO, “First, community schools already receive revenue from local taxes. The statewide average funding on a per pupil basis in FY 2015 is $7607, all deducted from the public school districts of residence. Meanwhile, the statewide average per-pupil state aid for traditional public schools is $4184.”

“The difference between what a school district receives from the state for a community school student and what is deducted from the district’s state funds must be made up by the district using local tax dollars. Further, a district does not receive the full basic aid amount from the state for any of its students, as is the case for community schools.”

Melissa Cropper – OFT told the committee that one of reasons that the levy failed in Columbus was the proposal to allow charter schools to receive funding from the levy.

See March 5, 2015 testimony at
http://www.ohiohouse.gov/committee/finance-subcommittee-on-primary-and-secondary-education

8) Economist Examines School Funding Provisions in HB64:  On March 5, 2015 economist Dr. Howard Fleeter from the Ohio Education Policy Institute, walked the House Finance Subcommittee on Primary and Secondary Education, chaired by Representative Cupp, through an analysis of the formula changes in HB64 (Smith) Biennial Budget, and offered some ideas for changing the proposed formula to provide more state resources for rural districts.

He began his testimony by saying that while the state has invested over $10 billion in school facilities and increased funding for operating purposes, “many problems continue to persist, including heavy reliance on local school levies and lingering questions about the overall adequacy and equity of funding across Ohio’s 611 school districts.”

He also described the current economic conditions in the state as the most “challenging” for constructing a school funding formula.  In no other time has there been such instability in property values, income levels, state revenues, and state funding formulas and funding levels for schools.  “The ramifications of this combination of circumstances is that current and proposed funding levels seem to many of Ohio’s school districts to be disconnected from either past funding levels and/or current circumstances.”

In trying to explain the estimated amount of state aid districts could receive through the new funding formula in HB64, Dr. Fleeter examined the effect of the 2009 recession on residential, business, and agricultural property values; described the changes in determining the “local share” using the proposed state share percentage; described the changes in transitional aid and the gain cap; and the changes in the three-year averaging of property values.

According to the Legislative Service Commission (LSC), real property values declined statewide by 6.5 percent between 2008 and 2012. Residential property value declines ranged from 2.2 percent for rural school districts to 17 percent for urban school districts. The value of real property in urban districts declined 14 percent and real property values in suburban districts and small town districts declined by 7.4 percent and 2.8 percent, respectively.

•CAUV:  Dr. Fleeter explained to the subcommittee that a 1975 program known as Current Agricultural Use Value (CAUV) helps preserve farmland by taxing it based on its agricultural productivity rather than its development value. The formula is highly complex and incorporates factors such as soil type, cropping history, crop prices, yields, non-land production costs and interest rates. The CAUV are applied when property is evaluated every six years, or updated every three years.

According to the presentation CAUV values increased by nearly 4 times from 2005 to 2013, both in per acre and total value terms. CAUV varies considerably across the state, and in some areas CAUVs are now very close to market values.

•Changes in the Three-Year Averaging of Property Values:  Dr. Fleeter noted that the new formula “skips” ahead a year in the three year averaging process, rather than averaging property tax values over three years with a two year lag between the most recent Tax Year of valuations used and the school year in which they are applied.  He found that this change means that a year of estimated values will be used to determine the state share of funding; the original intention of three-year averaging, which is to smooth over changes in valuation from year to year, will be undermined by averaging tax years with no overlaps; “Skipping ahead a year in the three-year averaging process particularly disadvantages rural districts where the CAUV increase have been the highest. By adding in an extra year of growth rural districts receive less state aid than they would otherwise.”

•Three Year Average Total Property Valuation:  A comparison of three year average total property valuation using ODE district typology categories shows that rural school districts show a 10.8 percent average increase in property values from FY14 (also used in FY15) to FY17. According to the presentation, “These districts also fare the worst under the Governor’s proposed plan. Rural districts experience the second highest increase in values and receive the next smallest increase in state aid. At the other end of the spectrum, the urban districts that receive the largest increases in funding actually see their values decline over this time period as did the suburban districts.”

A comparison of foundation formula aid in FY15 vs. the estimated state aid amount per HB64, using ODE school district typology categories, “…shows that urban, suburban and poor small town districts receive the largest percentage increases under the Governor’s plan, averaging double digit percentage increases. Poor rural districts and small towns and wealthy suburban districts all receive average increases of less than 5 percent, while rural districts actually receive a decrease in funding on average.”

To see if there was a way to adjust the negative outcome of the new formula on rural districts, Dr. Fleeter applied the traditional three year average, and found that the increase in rural school district values were lowered by about 2.6 percent, while other types of districts are not affected as much.

In addition, averaging property valuations over six-years for school districts with more than 20 percent of real property classified as agricultural reduced the growth rate in values in these districts nearly in half.

Dr. Fleeter also examined the efficacy of the proposed state funding formula to meet Governor Kasich’s intent to direct state funding to districts based on their capacity to raise local revenue by comparing FY15 (current formula) and FY17 (proposed formula) total state and local resources for school districts by typology.

According to this comparison, urban and poor small town districts receive the largest percentage increases in total resources from FY15 to FY17 under the Governor’s proposed formula, while rural, poor rural and small town districts receive the smallest increases (with rural districts actually going down). Suburban districts are in between.

Rural and small towns also have less total resources (often by $1,000 to $2,000 per pupil) than do the suburban and urban districts.

In FY15, the rural districts are $18 below the suburban districts in total resources. However, in FY17, the rural districts are $445 per pupil below the suburban in total resources.

According to the presentation, “This pattern reveals that despite having the largest increase in property valuation, the rural districts actually lost ground compared to the other typology groups. So even if many rural districts are at the 20 mill floor (meaning that they would in fact get additional local revenue as a result of their increase in property values — even increases from CAUV), Table 7 shows that after the effects of the proposed state aid formula occur they are worse off on average than they are now.”

Dr. Fleeter recommends that the proposed state aid formula in HB64 should be modified to provide rural districts with more state resources.  He notes that a previous study that he conducted found that rural districts offer fewer courses overall and fewer advanced courses, and additional state aid could help to close the opportunity gap for rural districts.

One way to modify the formula would be to provide additional funding component for districts that raise less revenue from a mill of taxation than other districts.  Another option would be to use another method to compute the state share, rather than ranking districts on a value per pupil basis, which is done using the state share index and the state share percentage.

See March 5, 2015 testimony at
http://www.ohiohouse.gov/committee/finance-subcommittee-on-primary-and-secondary-education

9)  Bills Introduced

HB92 (Hagan) School Employees-Sexual Conduct:  To prohibit an employee of a public or nonpublic school or institution of higher education who is not in a position of authority from engaging in sexual conduct with a minor at least four years younger than the employee who is enrolled in or attends that public or nonpublic school or who is enrolled in or attends that institution of higher education

HB99 (Curtin) Income Tax-School Funding:  To require that an amount equal to state income tax collections, less amounts contributed to the Ohio political party fund via the income tax checkoff, be distributed for the support of elementary, secondary, vocational, and special education programs.

FYI ARTS

1)  Arts Advocates Request More Funding for the Arts in HB 64:  The House Finance Subcommittee on Higher Education, chaired by Representative Duffey, received testimony on March 3, 2015 on the proposed budget for the Ohio Arts Council included in HB64 (Smith) Biennial Budget.  Presenting to the Committee were Donna Collins, executive director of the OAC, and Tim Greenwood, a member of the Board of Directors for Ohio Citizens for the Arts.

According to the testimony, as introduced HB64 includes $24.4 million in General Revenue funds to support the OAC.  This investment equals less than 0.04 percent of the state’s total GRF appropriations.  The OAC grants are matched by the grant recipients, so that every OAC dollar was matched with local and private funds at a ratio of 53:1 during the last grant cycle.

The OAC also received a $2 million grant from the National Endowment for the Arts for the biennium.

Donna Collins, executive director of the OAC, opened her remarks to the subcommittee by saying that this was an exciting time for the arts council, because it would be celebrating its 50th anniversary in May 2015.  The council was created in 1965 through legislation sponsored by Senator Stanley Aronoff (then a representative), and since that time has provided public funding in support of the arts throughout Ohio.

Director Collins told the committee that public investment in the arts has “far-reaching economic, educational, and cultural benefits”.  According to research from Bowling Green State University, the arts sector in Ohio supports 231,000 jobs, “contributing more than $31.8 billion to the state’s economy and generating about $3.4 billion in annual tax revenues at the federal, state, and local levels.”

The arts also inspire educational success.  Research confirms that an education in the arts creates the critical thinkers and problem solvers that employers need for the innovative and creative economy.

The OAC will begin to implement a new strategic plan, which will focus on ways to invest, innovate, engage, and lead, and improve agency funding, services, and processes to the meet the needs of constituents. Director Collins told the committee that “…the Ohio Arts Council is making a positive impact in the lives of children, families, arts
professionals, artists, and communities. The arts are economic drivers, sources of innovation and creativity, and at the very heart of our cultural infrastructure in Ohio. They are what makes Ohio — Ohio. Your investment through an appropriation to the Ohio Arts Council is a commitment to more creative sector jobs, arts education, works of art in every genre, and the preservation of cultural heritage for all Ohioans.”

Also testifying on HB64’s impact on the Ohio Arts Council was former House Representative Tim Greenwood.  He requested that the subcommittee increase to $30 million GRF appropriations for the Ohio Arts Council. The current funding levels of the OAC are the same as 1991, 25 years ago, and raising the amount to $30 million would still be below funding levels in 2001.

According to the testimony, investing state resources in the arts makes sense because the creative industries “contribute to the economies of every county in Ohio.  They provide an economic benefit in both urban and rural areas, catalyze new ventures, stimulate entrepreneurship and deliver the activities and attractions that fuel tourism in our state.”

2)  March is Music In Our Schools Month® (MIOSM):  The National Association for Music Education (NAfME) is celebrating all things music during the month of March.  This year marks the 30th anniversary of Music In Our Schools Month®, which “began as a single statewide Advocacy Day and celebration in New York in 1973 and has become a month-long celebration of school music in 1985.”

MIOSM engages music educators, students, and communities from around the country in promoting the benefits of high quality music education programs in schools.

The celebration includes a week-long bus tour from March 7-14 in which singer/songwriter RaeLynn will perform at five schools.  Student ensembles at the schools will also perform RaeLynn’s new song, “Always Sing”.

The Concert for Music in Our Schools Month will include this year student video performances from across the U.S.  The performances will be featured on the NAfME website throughout March.  The school video that receives the most views between March 1 and March 31, 2015 will win the Presonus Music Creation Software Suite.

According to NAfME, “Music teachers celebrate MIOSM in many ways by offering special performances, lessons, sing-alongs and activities to bring their music programs to the attention of administrators, parents, colleagues, and communities to display the positive benefits that school music brings to students of all ages.”

See “Celebrating Thirty Years of Music In Our Schools” at
http://www.nafme.org/celebrating-thirty-years-of-music-in-our-schools/


This update is written weekly by Joan Platz, Research and Knowledge Director for the Ohio Alliance for Arts Education.  The purpose of the update is to keep arts education advocates informed about issues dealing with the arts, education, policy, research, and opportunities.  The distribution of this information is made possible through the generous support of the Ohio Music Education Association (www.omea-ohio.org), Ohio Art Education Association (www.oaea.org), Ohio Educational Theatre Association (www.ohedta.org); OhioDance (www.ohiodance.org), and the Ohio Alliance for Arts Education (www.oaae.net).

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About OAAE

Since our founding in 1974, by Dr. Dick Shoup and Jerry Tollifson, our mission has always been to ensure the arts are an integral part of the education of every Ohioan. Working at the local, state, and federal levels through the efforts of a highly qualified and elected Board of Directors, our members, and a professional staff we have four primary areas of focus: building collaborations, professional development, advocacy, and capacity building. The OAAE is funded in part for its day-to-day operation by the Ohio Arts Council. This support makes it possible for the OAAE to operate its office in Columbus and to work statewide to ensure the arts are an integral part of the education of every Ohioan. Support for arts education projects comes from the Ohio Arts Council, Ohio Music Education Association, Ohio Art Education Association, Ohio Educational Theatre Association, VSA Ohio, and OhioDance. The Community Arts Education programs of Central Ohio are financially assisted by the Franklin County Board of Commissioners and the Greater Columbus Arts Council. We gratefully acknowledge and appreciate the financial support received from each of these outstanding agencies and organizations.
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