••• Education •••

Supreme Court ruling on school finance – some very good news and a few questions

The Kansas Supreme Court ruling on school finance has some very good news for citizens and also raises some interesting questions that legislators and citizens will have to address.

First, the good news. The Court upheld what we have constantly maintained – education is about outcomes rather than money. They specifically said “…total spending is not the touchstone for determining adequacy.1

Instead, the Court says adequacy “…is met when the public education financing system provided by the legislature for grades K-12—through structure and implementation—is reasonably calculated to have all Kansas public education students meet or exceed the standards set out in Rose and presently codified in K.S.A. 2013 Supp. 72-1127. This test necessarily rejects a legislature’s failure to consider actual costs as the litmus test for adjudging compliance with the mandates of Article 6. For example, even if a legislature had not considered actual costs, a constitutionally adequate education nevertheless could have been provided —albeit perhaps accidentally or for worthy non-cost-based reasons. And actual costs from studies are more akin to estimates than the certainties the panel suggested. Nevertheless, actual costs remain a valid factor to be considered during application of our test for determining constitutional adequacy under Article 6.2

This statement alone represents a sea-change in how education funding will be viewed going forward.

Those claiming that schools have not been adequately funded base their assertion on Base State Aid Per Pupil, which is only about 30 percent of total funding. The Court put that claim to rest by declaring “…funds from all available resources, including grants and federal assistance, should be considered.3

The Court also said, “…state monies invested in the Kansas Public Employees Retirement System (KPERS) may also be a valid consideration because a stable retirement system is a factor in attracting and retaining quality educators—a key to providing an adequate education. The panel may consider the restrictions on the use of these federal, pension, and other funds and determine that even with the influx of these additional monies the school districts are unable to use them in the manner necessary to provide adequacy under Article 6. But regardless of the source or amount of funding, total spending is not the touchstone for adequacy.4

Now that total spending from all sources is to be considered, it would logically follow that consideration of money provided to schools for education purposes but instead used to increase cash reserves should also be considered. Total spending as reported by the Kansas Department of Education does not include $430 million in state and local taxes that was used to increase current operating cash reserves between 2005 and 2013.

Efficient and effective use of taxpayer money also should get more attention in this new outcome-based approach to adequacy. Districts should not be allowed to claim they are underfunded if they are spending money inefficiently; in fact, the Legislature should convene a thorough review of school spending to get schools operating efficiently and identify money being spent that is not effective in moving students toward academic goals.

Legislators will have to resolve the equity issues on Supplemental General State Aid and Capital Outlay identified by the Court, but it should be noted that the SGSA issue is a classic case of ‘no good deed going unpunished.’ Beginning in 2010, the Legislature allowed districts to calculate their Local Option Budgets as though Base State Aid is $4,433 instead of the actual, lower numbers. The state didn’t equalize the higher spending authority but has actually increased the amount of aid provided for equalization; districts therefore didn’t lose any money, they only ‘lost’ an opportunity to get even more money.

The Supreme Court ruling also raises some interesting questions on how adequacy will be determined. Does “reasonably calculated to have all Kansas public education students meet or exceed the standards” mean that every student must meet or exceed standards or that adequate funding is provided so that every student reasonably has the opportunity to meet or exceed standards? The Kansas education community acknowledges that No Child Left Behind created an ‘impossible’ task of having every student be proficient, so we hope the Court intends the measurement to be on opportunity.

Other interesting questions include:
–   How will state assessment scores be used to measure adequacy? KSDE continues to say that scores will significantly decline with the transition to Common Core.

–   If state assessment scores must be used, is it therefore impossible to fairly measure progress until a new ‘normal’ is established with new testing? Or is it in the state’s (and students’) best interest to stop the transition to Common Core and return to pre CC-standards and testing?

–   The Supreme Court ruling clearly says that the Legislature may not reduce adequacy standards, declaring “…only the people of Kansas—at the statewide ballot box after a two-thirds majority vote by both the House and Senate—have the authority to lower the standards in their constitution.5 Does it therefore follow that the State Board of Education or the Legislature may not arbitrarily increase standards? And if so, is adoption of Common Core standards therefore unconstitutional?

Sharp legal minds will have to provide the answers to these and other questions. Speaking of which, we’re pleased to be able to share a brief analysis of Gannon v. State of Kansas by our friend Mike O’Neal. In addition to being an attorney and CEO of The Kansas Chamber, Mike was former Speaker of the Kansas House of Representatives and has great institutional knowledge of school finance. You can read his comments here.

It’s impossible to know if our tireless work to demonstrate that simply spending more money does not translate into higher achievement, that outcomes matter more than money or that all funding (including KPERS and local dollars) should count had any influence on the Court; regardless, the hard work ahead will be well worth the effort now that the Supreme Court says student needs take priority over institutional demands for more money.
1 Gannon v. State of Kansas, page 77 at http://www.kscourts.org/Cases-and-Opinions/opinions/SupCt/2014/20140307/109335.pdf

2 Ibid, page 76

3 Ibid, page 77

4 Ibid

5 Ibid, page 72