Thursday, January 6, 2011

LYNN: Minimum Budget Requirement -- Repeal or Leave in place?

An editorial in the Norwich Bulletin raised an issue that I had not heard of before, but which should interest anyone worried about schools, taxes, and how to survive the economic downturn. It sounds like a dull topic, but the details are so easy to explain and comprehend, that I think we can all get behind this one.

The State of Connecticut has a law on its books that requires towns to fund their schools at or above the same level that they did in the prior year. This is called the "minimum budget requirement." I couldn't believe that this was true, so I looked it up. Indeed, it is true and I even found a opinion from the CT General Assembly's Office of Legislative Research explaining the entire thing. It doesn't get any more official than that.

Interested readers should read the entire thing, but for my purposes, the last sentence is the most critical:

"The effect of the current MBR is to prohibit towns from reducing education budgets in FY 10 and FY 11 below their FY 09 levels. By law, the penalty for failing to meet the MBR is a reduction in the town's ECS grant for the subsequent fiscal year equal to twice the amount of the shortfall."

In plain English, this means that your town CAN NOT reduce how much it spends on education next year. By force of law, it is prohibited. The penalty is equal to twice whatever the town cut from the education appropriation.

Some lawmakers are suggesting that the MBR should be repealed. The Norwich Bulletin would keep the MBR as it is. Their reasoning? Connecticut schools have the worst achievement gap in the nation, so we shouldn't allow towns to cut spending.

I really don't follow the reasoning. It is true that CT does have the worst achievement gap in the nation. But basically, the Norwich Bulletin would argue that since schools have done a poor job with the money we gave them, we should continue to give them at least the same amount. The logic is a little fuzzy.

Here's my opinion on the matter, and I believe it to be perfectly consistent with a liberal philosophy.

The MBR discourages efficiency and innovation. No town has the incentive to do a better job, to reduce cost, to figure out how to do more with less. By the State's mandate, towns must appropriate the same amount next year, no matter how much more efficient or creative they become.

For example, imagine a couple of rural towns that offer a handful of advanced classes. They could offer more classes at a lower cost by harnessing the power of collaboration and technology. If they jointly paid a single teacher and used teleconferencing and the internet, they could broaden the academic course offerings and lower cost. But the MBR would penalize them for doing it.

Small districts could share expensive administrative personnel -- has anyone wondered why ever single school district needs a curriculum director? Sharing these types of resources would save money and could improve results. But the MBR prohibits it.

Finally, public school enrollment is steadily declining and some school districts are seeing big drops in their student enrollment. The MBR would require them to continue funding the schools at the same level, no matter how many students leave the district.

The MBR should be repealed.

11 comments:

  1. I am passing on an email received from Ray Hackett at the Norwich Bulletin:

    Rosemary....thank you for passing on the link to the blog item....however, if you would allow me to address one of the points where you stated....”the Norwich Bulletin would argue that since schools have done a poor job with the money we gave them, we should continue to give them at least the same amount. The logic is a little fuzzy.”

    If you read the editorial, we specifically stated that the answer to the closing the achievement gap is not throwing more money at the problem, nor is it cutting spending on education, but rather using better the money that is being spent. We don’t disagree that schools can do a better job, and we also agree that there is waste....our position is use the funding more efficiently and more effectively in providing a solid education. Just throwing more money at schools is not efficient, and cutting funds is not effective.

    We oppose the elimination of the Minimum Budget Requirement as “a trade off” to municipalities so that the state can then cut the aid its sends to municipalities for education. No one wins under that scenario.

    Thank you for allowing me to respond.

    Ray Hackett
    Editorial Page Editor

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  2. And my reply to Mr. Hackett:

    Dear Ray: Thank you for your response. This is an excellent conversation to have at this point in Connecticut. The issues facing the education system are enormous. By the way, this is Lynn responding to you. Rosemary and I share the blog and the email address in our efforts to run the joint blog we started last month. I apologize for any confusion.

    I am going to defend my statement that the logic is fuzzy, although I appreciate your point that you do not believe we should just throw money at the problem. If we all agree that the money is not being spent effectively now, then I don't see how maintaining, increasing or decreasing appropriations will fix the problem. In all likelihood, the achievement gap problem will not be solved until schools adopt proven curriculum and adjust instructional techniques based on research. There is a growing body of evidence that the achievement gap can be addressed cost effectively. (And I'd be happy to share my thoughts with you on that in the future.)

    But that has little to do with the Minimum Budget Requirement. The MBR hits every town equally, regardless of whether they even have an achievement gap issue.

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  3. I was also unaware of the Minimum Budget Requirement. In Mr. Hackett's statement in the email he sent to Lynn, he states "We oppose the elimination of the Minimum Budget Requirement as 'a trade off' to municipalities so that the state can then cut the aid its sends to municipalities for education. No one wins under that scenario." Am I missing something, or does repealing the MBR get rid of the problem, that is, the problem of the state threatening municipalities with loss of ECS grant money?

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  4. Repealing the MBR "gets rid of the problem" in that the towns would not be required to raise taxes (or slash all other services) to maintain a level appropriation next year when the State cuts ECS funding. With the MBR in place, towns will have to make up the difference if the State cuts its education grants to the towns -- which all expect to happen because the state is broke.

    Take Granby (and I'm simplifying the numbers, for the purpose of illustration) -- for this year Granby appropriated about $27 million for the schools, of which about $5 million came from the State. If next year, the State cuts its share by 10% (or $500,000), the town would be required by the MBR to make up the difference to keep the appropriation at or above $27 million.

    Without the MBR, Granby could reduce spending on education.

    Some legislators are arguing that the State can cut its share, but hold the towns responsible for making up the difference. So far, there haven't been many voices of reason out there arguing that the MBR would force towns to raise taxes or slash all other functions -- police, public works, the library. To make up a $500,000 cut, all town services would see a huge cut, and we'd have to raise taxes too.

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  5. Just throwing more money at schools is not efficient, and cutting funds is not effective.

    In public schools, spending has been de-coupled from results. When spending goes up, the results are the same. When spending goes down, the results are the same. When spending stays the same, the results are the same.

    Given the disconnect between spending and results, we should cut spending on public education, which has grown far beyond the rate of inflation for many years now.

    Let's get back to trend!

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  6. So this law requires that districts spend the same amount each year even when enrollment is declining?

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  7. Apparently. I haven't done a close reading of the law and I can't find the exact formula, but basically, that's what the MBR does -- each town must appropriate at or above the prior year's appropriation. I'm hoping there's some kind of SPED exception worked into the formula as SPED can vary wildly year to year depending on whether a high needs child moves in, moves out, or graduates.

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  8. This appears on the surface that the MBR is an unfunded mandate on the citizens. However well-intentioned it may have been at the outset, the results are downright dangerous to the students meant to benefit.

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  9. Repealing the MBR would be catastrophic in many CT towns. The argument that it stifles creativity in achieving greater efficiency ignores the fact that just like our household budgets, it costs more money each year to maintain the same level of "services." In Seymour, where I am a taxpayer, a parent and a member of our Board of Finance, our BOE has received a zero percent increase in the past two budget cycles and the BOE has only received its requested level services budget once in the past seven years. In effect, they have seen their budget cut nearly every year as the costs of providing services increases. Should the MBR be repealed, the educational system in Seymour - as I'm sure would be the case in many other districts - would be subject to the whims, opinions, and even anger of a minority of residents (who often make up the majority of voters).
    The two biggest responsibilities of a municipality are public safety and public education. While I have a great deal of respect for my fellow Seymour residents, we cannot leave our education budget in the hands of people who do not have the expertise to understand how much it costs to run a public education system.
    The CCM argues that the MBR undercuts democracy - this is a mass overstatement - democracy does not imply that voters have a right to gut our educational system...even when voters are struggling to make ends meet and are fed up and angry with the state of our government and our economy. Children and public safety must come first, and the MBR is the only protection our children have.

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  10. Great comment, K. But I disagree with your conclusion. If my experience, and that of other suburbs, is helpful -- the situation is unlikely to result in catastrophic cuts to education if the MBR is repealed. Schools boards and administrators have shown themselves to be quite capable of turning out the vote by threatening to cut popular programs. In my town, threatening music ed or art ed is a sure fire way to get parents to come vote for any budget.

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  11. i need the specific amount,....

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