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K-12 funding issues start to come into focus

The big issues facing K-12 funding were fully framed Wednesday for the legislative Joint Budget Committee, and staff analyst Craig Harper urged members to focus quickly on how to handle those questions.

Colorado Department of Education
Colorado Department of Education

In the wake of Amendment 66’s defeat, school finance is emerging as the top education issue for the 2014 legislature. School districts and some lawmakers are pushing for increases that would help restore some of the cuts of recent years.

But Gov. John Hickenlooper’s proposed 2014-15 K-12 budget suggests a relatively modest hike that basically covers just enrollment growth and inflation. The governor’s budget proposes more significant increases for higher education.

Harper met with the committee for four hours Wednesday during the members’ annual pre-session briefing on the governor’s proposed Department of Education budget for 2014-15. Harper’s presentation was based on a 139-page briefing paper prepared for the committee.

Harper made recommendations on some issues but didn’t make specific suggestions on others, noting they are weighty enough to require discussions between the committee and the department and decisions by the JBC and legislative leadership.

That sets up an interesting session on Dec. 19, when Colorado Department of Education officials will meet with the JBC to answer questions.

Here are the key points of the major issues raised during the briefing:

School finance

Harper suggested that the legislature needs to make key decisions on how much to spend on schools in 2014-15, how to balance that spending between the main general fund and the supplementary State Education Fund (SEF), how to maintain the health of the SEF over several years and how to reduce what’s called the “negative factor.”

During the recession, the legislature reinterpreted constitutional provisions that govern annual increases in school funding, deciding that those provisions applied only to base funding but not to the additional money used to adjust support to districts based on special needs. That mechanism, called the negative factor, allowed the legislature to spend less on schools than it otherwise would have. That gap now is estimated at about $1 billion.

Hickenlooper is proposing a $222 million increase in school funding for 2014-15 but no significant reduction in the negative factor.

The governor wants to take most of the increase from the SEF, something Harper disagrees with because he fears doing so will just put more pressure on the general fund in later years.

Many districts and education interest groups are pushing hard to reduce the negative factor. Harper’s briefing paper agreed that doing so would be a good thing to do – if lawmakers can find the money.

“Staff recommends that the committee and the General Assembly focus early discussions on the broader questions of how much to pay, how to finance any increases in appropriations, and whether to increase the minimum balance in the SEF. Staff recommends that the committee initiate discussions with legislative leadership, the education committees, and the governor’s ofice concerning those broader questions,” Harper wrote.

Harper also analyzed and made recommendations on several other education budget requests.

Testing

The Department of Education has requested $3.8 million (most of it from the SEF) for development and administration of new tests. (See this EdNews story for an update on those plans.

Harper’s briefing paper noted that many school districts are worried about being ready for online tests, particularly in 2015, and that there also are concerns about expected drops in achievement levels because of the transition and about the pressure of implementing multiple reforms. But he didn’t make specific recommendations about funding the request, suggesting committee members discuss the issue further with the department.

BEST program

The state’s Building Excellent Schools Today construction grant program is at a crossroads, given that it’s almost out of money for making large grants and because a recent state audit found problems with program administration (see this EdNews story).

Harper recommended that the legislature pass a law to make BEST’s smaller cash grants subject to legislative approval. Another panel, the Legislature Audit Committee, is expected to introduce a bill that would tighten up on BEST requirements for local school district matches.

Other budget issues

The department is requesting a $3.1 million increase and additional staff to beef up its computers and information technology unit to meet the demands of managing the avalanche of new data that will be generated by various reform efforts such as the new teacher evaluation system.

Harper agreed that additional money is necessary but suggested the committee discuss the issue further with the department.

Several lawmakers at Wednesday’s hearings also raised questions about CDE’s current independence from the Governor’s Office of Information Technology, which coordinates IT services for a number of other state agencies.

On another issue, Harper suggested that the state’s English language learners law needs a broad overhaul beyond the $430,000 the department is asking for to provide additional assistance to districts. (Such a bill is in the works.)

JBC vice chair Pat Steadman, a Democratic senator from Denver, agreed, saying, “the issue is far bigger than technical assistance.”

Another department request proposes spending $2.8 million from the SEF to cover continued funding of the early literacy assessment tool required by the state’s early literacy law. Harper again recommended the committee discuss this issue with the department and with leaders of the legislature’s two education committees.

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