Casey’s got just a fascinating post up… very bloggy and subjective, which makes it cool:
Gov. Deval Patrick, his voice often rising to a shout, cheered on die-hard supporters today at a Boston Common rally to push for reforms to the state’s education funding formula, saying, “My power comes from you and your willingness to show up.”
(And when I say supporters, I mean it took the governor 15 minutes to walk down Beacon Hill because he was being stopped by so many hangers-on, well-wishers and a few overly aggressive education activists?The only thing missing was holy water being sprinkled on him. I say this not as a comment on the governor or his policies, but as a point about the bizarre deification of public leaders in general. We are a government of men and women, people, not Gods and what we seem to believe are their earthly counterparts: celebrities)
You know, I share Casey’s disbelief at such a strong crowd reaction to Patrick; it is kind of funny. But I doubt most public leaders get that kind of response from people. Would Paul Cellucci (say) have commanded such a crowd?
Anyway, Patrick seems to be back giving us the vision thing on education — see what he said.
“?Let’s confront what (education) actually costs, and then let’s ask ourselves what financing mechanisms are out there that work, because I want to tell you something: Try as we might to patch the Chapter 70 (education funding) formula, it’s not enough. Property taxes as a basis for closing the gap is not working.”
Well, that sounds like a call for more and different revenue streams. What’s he actually proposing? Was anyone there today?
about revenue streams, other than taxing telephone poles and such.
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The current state formulas assess each town half based on their property equivalent value, and half based on DOR reported income. That is to say, currently, the state makes towns collect property tax revenues in part based on town’s aggregate income.
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I suggest the right way to tax income to support education is to tax it directly, rather than indirectly, and earmark the part that is going for schools so it can’t be spent for something else.
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The legislature’s opinion, I believe, is largely that the voters have spoken on the subject of income taxes, and what they said was to cut them, rather than raising them. That is, legislators hear daily from people who complain that the state didn’t follow through on the ballot initiative to cut the income tax rate back to 5%, and while they sometimes get complaints about property taxes, usually the electorate does not connect the local problem of coughing up funds for schools with what happens on Beacon Hill.
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So, you want a new revenue stream, you have to overcome these two very powerful forces of public opinion.
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Two jingles in that direction. Why not tie an increase in the income tax to a trust fund dedicated specifically to school funding.
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And, did you know that the state regulates local spending on schools, which explains high property tax burdens for about 100 towns that are over-assessed?
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Probably: education costs are outstripping inflation while the towns are limited to 2.5 tax levy growth. The Chapter 70 allocations aren’t making up the difference. We have to keep up with the rising costs by replacing property tax with a higher state income tax or else a local option, whether that’s a local income tax or a local sales tax. Raising property taxes isn’t an answer.
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In my imagination: education costs are outstripping inflation because of the cost increases that exceed inflation–teachers wages plus insurance plus retiree benefits. Student performance hasn’t and isn’t improving as a result. Towns and cities are ignoring the key cost inflators and cowtow to the useless and expensive public sector unions to keep and increase benefits. We have to initiate some cost control measures. Raising property taxes isn’t an answer.
It all goes back to benefits, doesn’t it? I think you’re totally right, and health care and pension costs are killing us. They’re killing the private sector, too.
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gary, I’d love to get your bipartisan help banging the drum for the state to create a strong, real-deal health care best-practices agency. In other words, actually do the real research work that the Quality and Cost Council can’t possibly do well. We need a market with better information, and as Charlie Baker says, we don’t have it.
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Health care costs are a huge fiscal issue, a huge tax issue, a huge economic-growth issue … and a humane issue.
it’s not benefits, benefits, benefits.
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it’s salary, salary, benefits.
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typical school system budget is comprised this way: 60% salaries, 10% health care, 30% other stuff.
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the average salary grows at 6% per year. raises.
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health care costs probably rise at 9% per year. crazy.
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but the picture remains that in K-12, the MUCH BIGGER squeeze (by a factor of 4) on the bottom line is the 6% increase on the 60%, not the 9% increase on the 10%.
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so it doesn’t “all go back to benefits.” towns and cities give 6% raises when revenues will be up maybe 3% per year for next couple years.
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even if we HALVED health care cost growth to 4% or 5%, we’d still have the “raises” issue.
If the 60% raises by 6% (i.e. a lot), and the 10% increases by 9-14% (insane), then doesn’t it stand to reason that the 10% becomes more than 10% after a while?
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Right?
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Then, the town added a position, giving the Town Manager an assistant.
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So summarize it out: 1) raise of 3% then 4% with commensuate increase in pension. 2) town gives him an assistant in $60K to $80K salary range plus benefits 3) medical insurance increased at the typical 8 to 9%.
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If you add up the year-over-year percent change in the Town Manager’s office, it exceeded 4%. In other words, it exceeded the revenue forecast.
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Should the Municiple Ref throw a flag on that play?
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How many times per year throughout the 851 towns in the state, does this bonehead stuff happen?
you just doubled the number of towns in Mass!
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Gary, I agree that cost control and value for the dollar are a big part of the solution, and lots of school committees don’t seem to have the resources or the interested parties to make that happen. Perhaps the state could provide information services and guidelines on best practices – rather than more regulations – to help bridge that gap.
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At the state level, though, the foundation budget has been inflation capped since FY03, and Mass Budget & Policy Center says this has resulted in a $350 million shortfall of state aid, relative to the implicit price deflator for state and local government purchases. This definitely accounts for a significant part of the pressure on local budgets in recent years; even after being cut across the board by 20% in FY03, state aid has failed to keep up with the wage and price deflator.
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Towns have been forced to cope with the resulting squeeze, as well as with additional pressure from state regulations, over the past five years, and hence the resonance of Deval Patrick’s messages, both on property tax relief and on assessing the true cost of education.
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I’m not really impressed that the only thing Patrick has offered as relief for property tax burdens is other ways for towns to assess taxes, as I see the problem as a combination of too much state regulation and too little state funding. Combined, perhaps, with a need for the type of cost containment you advocate.
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How’s this for a deal. If you advocate for better cost containment, I’ll advocate for the state to fund its mandates. Hmm. I suspect you don’t see that as a win-win proposition!
Here’s another source for cost containment: prevailing wage.
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It costs about $25 per hour for a heavy equipment operater in Central Mass.
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Current bidding is out for some local projects, and prevailing wage is $52. It’s required for all the school construction, town jobs, etc…
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@MassParent
Can you provide some examples of where you think there is too much state regulation? I’ve taught in two other states besides MA, and it seems to me that there is far less regulation in MA. Or, at the very least, the state provides broad guidelines but the details are left to the local district.
is on required minimum contributions and regional schools, where spending is tightly controlled but the formulas driving spending have created very large differences in required spending for comparable towns.
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A big part of this problem will hypothetically be resolved by equalizing spending requirements in the chapter 70 formulas three years from now, but as of this year, many locale’s spending requirements are still diverging from equity. And I think they could have achieved much of what they’ve tried to achieve with tighter regulation in a cleaner way just through the funding formulas, leaving more room for regional districts to manage their own affairs.
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There’s also a lot more regulation on accountability, combined with similarly whacky data feeding the formulas. That is to say, there are no 100% proficient schools in the state, but every school is mandated to be 100% proficient in six years, or face escalating regulatory sanctions. At present, the regulations only require schools to perform around the statewide average to avoid sanctions, but the bar ratchets up every two years for the next six, going through the average suburban school in a couple years, to high performing homogenous schools in four years, and beyond most of the highest performing schools in six years. But the regulated sanctions don’t make sense as stand-alone reforms that should be applied to average, above average, and high performing schools and school districts. And even for the low performers, which are currently sanctioned, the sanctions as often as not appear capricious to me, rather than based on proven best practices and sound analysis of cause and effect.
yes, we absolutely have to attack the crazy/insane health care increases.
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let’s imagine a $100 million per year district now.
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in 7 years
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it will spend 20 million on health care if costs rise at 10%, up $10 million
it will spend 90 million on salaries if they rise at 6%, up $30 million
it will spend 32 million on everything else if that rises at 1%
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so in 7 years, the health care is now 14% of the total budget. salaries are 62% of the total budget.
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“everything else” is what takes a hit, down to 24% of the budget. books. computers. paint brushes. erasers. basketballs. bus maintenance. fixing the leaky ceiling. school lunch.
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so school committees and teachers unions — complicit in hiding the 6% raises, because local support for those raises is low when that’s not the sort of raise most voters get — redirect voters to other culprits.
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the other culprits include: “all those tests” (in districts where they resent accountability), “charter schools” (if available in that locality), health care and energy costs.
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again, i’m just saying if we “fix” health care cost increases, which would be terrific, the school budget dynamics will remain, with “everything else” squeezed.
Revenues are usually forecast to rise in the 4 to 4.5% range for most Towns and Cities.
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I think the “salaries, salaries, benefits” is right.
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It’s almost like the towns need some sort of “Officer of Paygo Sanity”, so that when the Town Counsel awards raises, there’s some geek, green eyeshade guy in the back of the room who is required to raise his hand and ask where the 6% money is coming from when revenues are increasing at 4%.
This is what I have observed of school committee (SC) negotiation.
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DEPTH
One strategy that is used when negotiating salaries is the “market basket” survey. Using a number of factors, your community is grouped with 10 or so others. The union fools SCs by giving them input into what criteria will be used to determine the market basket. As a result, SCs don’t even realize that the market basket approach is a bit of a rouse. By limiting their salary analysis to just 10 other communities, the union (aided by its state leadership) can pit one town against another. If they can convince 1 or 2 of these communities to give them a bump in salary, all the rest will follow suit as the jockey for that ideal “middle” of the market basket.
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WIDTH
In schools we often see student to teacher ratio, but another interesting ratio is total staff to students. Our teacher to student ratio is 14:1, but our staff to student ratio is about 6:1. I would hazard a guess that most SCs do not know what personnel they have, what their responsibilities are, or how their staffing levels compare to other schools throughout the country.
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When it comes to setting salaries and staffing standards, the tendency of the layman employers (SC members, Town Meeting, etc.) is to be NICE. I’ve stopped counting the number of times that I’ve witnessed elected board members using the union arguments and actually berating the public when it comes to these decisions.
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