During the first week of the legislative session, a proposal for a comprehensive school choice plan was introduced that is far more expansive than anything ever proposed before. This universal program would provide any student in the state with the ability to take the state cost per pupil that had previously been allocated to the public school district and use that money to pay for private school tuition. It also phases in a mechanism to pay that amount for families that have already chosen private school. This includes any and all students without regard for poverty level. While you may think that Hudson is immune because we don't have a private school in our district, let me correct the record. We may not have a private school in our district, but we most certainly have students who attend private schools outside our district.
But before we get there, I think it is first imperative to look at the topline numbers in this proposal. As a starting point, $106 million is being proposed in this first year. When fully enacted, according to the governor's office, the plan is expected to cost over $900 million within 4 years, and then $340 million annually. Now, to put that $106 million [base year cost] in perspective, it is important to note that the increase in school funding for next year is proposed for just $83 million, or 2.5%. Furthermore, this is a significant expansion from previous proposals. Three years ago it was very narrow and limited to a small number of students in metro areas. Last year, the proposal was $55 million and based on a poverty factor that would accommodate up to 10,000 students. Neither of these proposals were enacted. One must wonder why such an extreme position was taken up this session.
Here in Hudson I have forecast our budget five years into the future. In that model I assume a growth rate of 2.5%, solve for enrollment growth, and increase expenditures 5% per annum. Is 5% too aggressive? Perhaps. But, consider the following: CPI is currently running at 8.6%, the labor shortage requires us to offer more competitive wages to attract and retain quality teachers and staff; and as a growing school district we are actually adding teaching faculty. The fact is, the primary reason we are in such great financial shape is because of growing enrollment. The model I have prepared considers all those variables. But if this model comes to fruition it will catch up to us, and quickly. In just 5 short years, we will bleed off more than $3 million of our $4 million in reserve. And remember, that assumes enrollment continues to grow. Imagine if instead of investing the proposed $83 million in state aid for the funding formula, we invested $189 million (the sum of the state aid and funding proposal for the vouchers). I can promise you it would make a tremendous impact on our forecast, our ability to hire and retain staff, and enable us to protect the program opportunities that may otherwise be in jeopardy.
Based on our most current data, we have approximately 15 students who already choose nonpublic school. Those students aren't currently counted in our enrollment, so when they become eligible for the school choice plan being debated there is lost funding for our district. Further, one could reasonably conclude based on our historical data [that] at any given time in the future, we could lose 15 or more additional students. At the current state cost per pupil that would be a loss of $113,970 annually. That is just the state cost, but other funds are generated based on enrollment, such as the state penny for school infrastructure, dropout prevention and instructional support. While the proposal allows school districts to keep some of the categorical funds associated with the number of resident students attending the private school, it doesn't come close to making up the shortfall. Considering all the impacted revenues, Hudson public school students would be shorted a net of $121,440 if just 15 more students attend private schools. Roughly the equivalent of two teaching positions.
It is safe to assume that students who are taking advantage of proposed choice program will be 'normally' distributed across the span of grade levels. In other words, they won't all be concentrated in 3rd grade. This is an important point because often times it is argued; that by virtue of the student no longer being in the school district, they no longer have the responsibility of educating that child. Thus the expense is no longer present. This isn't true precisely because of the distribution of the students. If the 15 students mentioned above (again, a real number by the way) are spread out across 13 grade levels, then the expense has not in fact been removed. Instead, the revenue has been removed, but the expense remains. You can't cut 1/20th of a teacher, lower the thermostat by 1/20th, or reduced any of the fixed costs that are necessary for the efficient and effective operation of a classroom.
For a moment lets turn back to my forecast mentioned above. Reducing future expenditures per annum may in fact become necessary to balance the budget. How would we do that? Well, if one presumes concentrated loss at the kindergarten level for example, it could come in the form of a teacher. If the average kindergarten class is 55 students, for Hudson that is a relatively easy solution: three classes of 18/18/19. However, if you reduce that class size by 5 and are left with 50, the decision becomes a bit more complex. In this case you may be looking at 25/25. The math is easy. The teachers and parents on the other hand, well, can you imagine 25 kindergarten students in one section? That part, well it's not so easy.
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