(Note: This commentary originally appeared as an Op-Ed in the
Lansing State Journal on March 16, 2008.)
By
passing Proposal A in 1994, Michigan residents became school finance reform
leaders, establishing a model that other states are now beginning to follow.
This state constitutional amendment continues to benefit teachers, school
districts and taxpayers. It could do more if its underlying principles were
pushed further.
Proposal
A’s most noticeable benefit was significant tax relief for property owners,
including a cap on future property tax increases. Balanced against that was a
new 6 mill state education property tax, and a tax on all real estate transfers.
Taxpayers also are paying more — and schools are collecting more — from Proposal
A-related tax increases on sales and cigarettes.
Perhaps
the most significant effect was that the basis for school funding became the
number of students in a district — the money follows the students. As explained
in the Mackinac Center’s "Michigan School Money Primer," each student brings a
"foundation allowance" when his or her family chooses a conventional school
district or charter public school.
This is a
huge boon for teachers because it focuses funding on what happens in classrooms.
If parents in a given district are happy with their kids’ classroom experience
and decide to re-enroll, the district benefits financially. Certainly other
factors, such as the state economy and school safety, can be significant, but
teachers on the front lines have the professional skills to make an enormous
impact on a school’s success.
While
most complaints about Proposal A come from school personnel feeling the pinch of
declining enrollment, to some extent this is related to outstate migration and
declining birth rates. However, since revenues deposited into the state school
aid fund must be used for education, fewer students statewide means more money
for each remaining student.
However,
a particular school district’s enrollment decline relative to other
districts is a reflection of parents’ choosing a school other than the one to
which they have been assigned. Viewed in this way, a student exodus provides
districts with a signal and an opportunity to adjust their services to what
parents and children desire. Schools must compete for students and the money
attached to them, which, under the right conditions, can improve educational
quality.
Proposal
A’s effectiveness should be enhanced in three ways. First, rather than receiving
funds for "phantom students" — the effect of using a "blended count" that
includes only 75 percent of the current year’s enrollment — schools should get
funds only for the students actually enrolled.
Second,
state funds distributed to districts for specific optional purposes —
"categorical grants" — should be consolidated into the foundation allowance.
Districts should decide how to spend their funds.
Third,
following the logic behind Proposal A, parents should be given even more
educational options, including private schools. This could be effectively
implemented with an education tax credit, which would allow parents, relatives
and businesses to invest their own money and take direct responsibility for
kids’ education. We can already do this for early and higher education. Why
should our elementary and secondary students be any less important?
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Dr. Ryan S. Olson is
director of education policy at the Mackinac Center for Public Policy, a
research and educational institute headquartered in Midland, Mich. Permission to
reprint in whole or in part is hereby granted, provided that the author and the
Center are properly cited.
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