Statehouse roundup

Spare change found for school funding bill

Longtime testing critic and former Rep. Judy Solano (left) made here case on the testing opt-out bill.

The House Education Committee Monday added some symbolic funding for at-risk students to the proposed 2015-16 school finance bill.

The measure, SB 15-267, is a disappointment to districts and many legislators because it does little to reduce Colorado’s school funding shortfall.

The bill would increase K-12 funding by $306 million to about $6.23 billion next school year. But most of that is driven by constitutionally required hikes to cover enrollment growth and inflation.

The only significant discretionary increase in the bill is $25 million that would be applied to the funding shortfall, the so-called negative factor. That shortfall currently is about $880 million. Average per-pupil funding would rise to $7,295 from this year’s $7,026.

Democrats fought unsuccessfully in the Senate to add more money to the bill, particularly for at-risk students, by tapping the State Education Fund, a dedicated K-12 account. Those efforts failed in the face of arguments that taking money from the education fund would put unacceptable pressure on the state General Fund in future years.

“What you see in front of you is about the best we can do this year,” sponsor Rep. Millie Hamner, D-Dillon, told the committee.

But Hamner and other lawmakers have managed to find a little more money. An amendment approved by House Education added $5 million to the bill for at-risk students, taken from the interest earned on yet-another dedicated state account. The money would be distributed to districts on a per-student basis. With about 370,000 at-risk students in Colorado, that works out to about $13.50 per kid.

Another amendment added to the bill’s “legislative declaration,” or introduction, states that the 2016 legislature will retroactively increase funding if local district revenues rise more than expected. (K-12 funding is a combination of local and state revenues used to add up to the total minimum annual amount required by the constitution. Typically, when local revenues rise the state contribution is reduced.)

Some projections estimate that local revenues will be $70 million higher in 2015-16 than previously forecast. The amendment is a promise – not necessarily ironclad – that the 2016 legislature won’t reduce the state share if the $70 million comes in, giving districts a net increase.

The bill was passed 10-1 and sent to the House Appropriations Committee.

Testing issues rehashed in opt-out bill testimony

House Education’s main act Monday was supposed to be Senate Bill 15-223, the measure intended to codify parents’ rights to opt their children out of state standardized tests.

The panel took more than three hours of testimony on the bill, much of it a rehash of opinions offered during hearings on other testing bills.

There were a few high-profile witness, including Democratic former House Speaker Terrance Carroll, who opposed the bill. Democratic former Rep. Judy Solano, a critic of testing before that became fashionable, and Democratic State Board of Education member Val Flores supported the bill.

As originally introduced, the bill would have required districts to allow parents to opt out of any standardized tests required by the state or local districts and banned imposing any “penalties” on students, teachers, principals or schools for low test participation.

How to define “penalty” emerged as a key question during Senate consideration, and amendments in that chamber narrowed the definition. One change clarified that the bill doesn’t apply to local tests. A second change specified that school and district accreditation ratings and educator evaluation levels aren’t defined as penalties. This means that test scores and student growth data derived from scores could continue to be used for accreditation and evaluation. (Get more information in this story and in this legislative summary on Senate changes in the bill.)

The amended bill passed the Senate 28-7, but Monday’s House education discussion suggested that even the amended bill may have problems in the House. Both Democratic and Republican members raised questions about possible loss of federal funds, erosion of the state’s accountability system and weakening of teacher evaluations.

Some committee members also noted the U.S. Department of Education’s stand on opting out (see this Chalkbeat Colorado story for the background).

Bill sponsor Rep. Steve Lebsock, D-Thornton, asked that House Education delay a vote on the bill. That may not be a good sign for the measure, given that lawmakers have to adjourn by May 6.

Last gasp for tuition tax credits bill

The committee finished up its nearly seven-hour meeting by voting 6-5 to kill Senate Bill 15-045, this session’s version of the perennial proposal to provide state income tax credits for the cost of private school tuition or private school scholarship contributions.

Over to you, senators

Both houses worked through long floor calendars Monday morning as they raced the clock toward adjournment on May 6. These education-related measures were passed by the House and are headed to Senate committees.

House Bill 15-1201 – Provides $10 million in grants to boards of cooperative educational services to help districts consolidate administrative services. Passed 48-16

House Bill 15-1324 – Creates a grant program to help districts to develop student learning objectives that can be used to track pupils’ progress and to evaluate teachers. 34-30

House Bill 15-1350 – Calls for a review of the standards for accreditation of alternative education campuses, which generally serve high school students who’ve previously dropped out or who lack large numbers of credits. 64-1

House Bill 15-1339 – Eases some of financial transparency requirements imposed on school districts by a 2014 law. 38-26

The House also voted 64-0 to pass Senate Bill 15-173, the bill that would impose a variety of security and privacy requirements on data companies that work with school districts. Some bill supporters think House amendments weakened the bill, so this one may end up in a House-Senate conference committee.


Colorado schools are getting a major bump in the state’s 2018-19 budget

Students waiting to enter their sixth-grade classroom at Kearney Middle School in Commerce City. (Photo by Craig Walker, The Denver Post)

Colorado’s strong economy has opened the door for state lawmakers to send a major cash infusion to the state’s public schools.

As they finalized the recommended budget for 2018-19, the Joint Budget Committee set aside $150 million, an additional $50 million beyond what Democratic Gov. John Hickenlooper had asked for, to increase funding to schools.

“We believe this is the most significant reduction in what used to be called the negative factor since it was born,” said state Rep. Millie Hamner, the Dillon Democrat who chairs the Joint Budget Committee.

Colorado’s constitution calls for per pupil spending to increase at least by inflation every year, but the state hasn’t been able to meet that obligation since the Great Recession. The amount by which schools get shorted, officially called the budget stabilization factor, is $822 million in 2017-18. Under state law, this number isn’t supposed to get bigger from one year to the next, but in recent years, it hasn’t gotten much smaller either. 

But a booming economy coupled with more capacity in the state budget created by a historic compromise on hospital funding last year means Colorado has a lot more money to spend this year. In their March forecast, legislative economists told lawmakers they have an extra $1.3 billion to spend or save in 2018-19.

The recommended shortfall for next year is now just $672.4 million. That would bring average per-pupil spending above $8,100, compared to $7,662 this year.

Total program spending on K-12 education, after the budget stabilization factor is deducted, should be a little more than $7 billion, with the state picking up about $4.5 billion and the rest coming from local property taxes.

The budget debate this year has featured Republicans pressing for more ongoing money for transportation and Democrats resisting in the interest of spreading more money around to other needs. The positive March forecast reduced much of that tension, as a $500 million allocation for transportation allowed a compromise on roads funding in the Republican-controlled Senate. That compromise still needs the approval of the Democratic-controlled House, but suddenly a lot of things are seeming possible.

“We knew we were going to have more revenue than we’ve ever had to work with,” Hamner said of the status at the beginning of the session. But that presented its own challenges, as so many interest groups and constituencies sought to address long-standing needs.

“The fact that we’ve been able to reach such incredible compromises on transportation and K-12 funding, I think most members will be very pleased with this outcome,” Hamner said. “Where we ended up is a pretty good place.”

The big outstanding issue is proposed reforms to the Public Employees Retirement Association or PERA fund to address unfunded liabilities. A bill that is likely to see significant changes in the House is wending its way through the process. The Joint Budget Committee has set aside $225 million to deal with costs associated with that fix, which has major implications for teachers and school districts budgets.

The Joint Budget Committee has also set aside $30 million for rural schools, $10 million for programs to address teacher shortages, and $7 million for school safety grants.

The budget will be introduced in the House on Monday. Many of the school funding elements will appear in a separate school finance bill.

Going forward, there is a question about how sustainable these higher funding levels will be.

“It does put more pressure on the general fund,” Hamner said. “If we see a downturn in the economy, it’s going to be a challenge.”

What's fair

Colorado’s state-authorized charter schools could get more money next year

Students at The New America School in Thornton during an English class. (Photo by Nic Garcia)

Charter schools authorized at the state level by the Charter School Institute are likely to get more money in the 2018-19 budget year. That’s one year before most other charter schools will see benefits from last year’s charter school funding equity bill.

That bill was a major compromise out of the 2017 session, and it requires school districts to share money from voter-approved tax increases with the charter schools they’ve authorized, starting in 2019-20. The bill also created the mill levy equalization fund to distribute state money to the Charter School Institute’s 41 schools. Because no local school board approved these schools, they wouldn’t otherwise be eligible for revenue from these increases, known as mill levy overrides.

Charter School Institute administrators came calling for their money this year, though, with a request for $5.5 million from the general fund. They arrived at this number by identifying institute schools within the geographic boundaries of districts that already share some extra revenue with their local charters and assuming institute schools got a similar share.

Institute Executive Director Terry Croy Lewis called it a “first step” toward parity that would bring institute and district-authorized charter schools to the same level in advance of the new law going fully into effect in 2019. Lewis said it seemed like a fair approach because the parents at institute-authorized schools often live within the geographic boundary and pay taxes at the same rates as parents whose children go to traditional schools or district-authorized charters.

However, the charter equity bill says that extra money for institute schools has to be distributed on an equal per-pupil basis. The original approach, which created more equity among schools in the same geographic boundary, created more disparities among institute schools in different regions – and the law might not have allowed it.

“I don’t think you can define equity in this conversation because equity cuts a lot of different ways,” said state Sen. Dominick Moreno, a Commerce City Democrat and member of the Joint Budget Committee.

Budget analyst Craig Harper suggested to the Joint Budget Committee that separate legislation might be necessary to allow the distribution proposed by the Charter School Institute, something no lawmakers wanted to see after the bruising fight over the charter school equity bill.

Instead, the Charter School Institute revised its proposal to distribute the money among its schools on a per-pupil basis, regardless of geography and whether the local district already shares money.

What sort of difference does this make?

In the first distribution scenario, Early College of Arvada, located in the Westminster district, would have gotten nothing – because Westminster doesn’t currently share money with its own charters. Under the new proposal, the school would get $131,233 based on its pupil count. Meanwhile, Colorado Early College – Fort Collins, which would have gotten $621,357 because the Poudre district already shares money, would instead get just $374,952

Lingering confusion over the distribution question led JBC members to postpone a decision several times before they voted 4-2 this week to include the $5.5 million request in the 2018-19 budget.

It still has to survive the extended battle over the budget that takes place in the full House and Senate each year.