Author Archives: Max Marchitello

3 Reasons Why Teacher Pensions Are Critical to School Funding Equity

Money spent on public teacher pensions is often left out of analyses of school finance equity. Rather than a being seen as an issue affecting students’ education, pensions are often viewed as a budgetary dilemma for state legislators. Yet, both of these approaches overlook the effect pension spending can have on increasing the funding gap between schools based on students’ race.

Last week I released a new report, “Illinois’ Teacher Pension Plans Deepen School Funding Inequities,” that shows just how much pension spending in Illinois affects the state’s finance equity. The results are startling and reveal that teacher pensions are yet another example of how states and districts underinvest in the education of low-income students, and the educations of black and Hispanic students.

Here are three key reasons why teacher pensions should be thought of as a key part of the push to ensure educational equity:

  1. Class-based gaps grow by more than 200 percent after accounting for pension spending. Teacher salaries comprise the lion’s share (roughly 80 percent) of school expenditures. And, unfortunately, the most experienced and highest paid teachers are unevenly distributed across schools. In Illinois the salary gap between the schools serving the highest and lowest concentrations of low-income students is on average around $550 per pupil. After factoring in pensions, however, the disparity jumps to over $1,200 per student.
  2. Race-based gaps increase by more than 250 percent after accounting for pension spending. In Illinois, the average teacher salary-based gap is $375 between schools serving predominantly white students and those serving predominantly nonwhite students. But after accounting for money spent on teacher pensions, the inequity increases to nearly $950 per pupil.
  3. States are investing more money in their pensions (because they’re in significant debt), and that will widen the gaps even further. From an educational equity point of view, the Illinois pension system is the problem. Since pensions are paid as a percentage of teachers’ salaries, which are unevenly distributed across the state, funneling more money into the system may help to decrease unfunded liabilities, but it also will result in even larger funding disparities.

Illinois is widely considered to operate one of, if not the most, inequitable school finance systems in the country. Yet, many prior analyses underestimated the problem because they have not always included money spent on teacher pensions. This problem is not unique to Illinois. On the contrary, pensions will increase funding disparities in any state with an uneven distribution of teachers. The effect will likely be greater and more closely resemble Illinois in states, such as Missouri and New York, where large urban cities operate separate pension funds.

There are a couple of steps states can take to mitigate the increase in education funding disparities due to pension spending. Those states with more than one retirement system should consider folding the district plans into the state fund. The state has greater resources and almost always contributes to the pension fund at a higher rate. This would ensure that schools in the district — which disproportionately serve low-income students and students of color — receive pension payments at the same rate as other schools.

As it stands now, low-income students and students of color receive far less than their fair share in school funding. To change that, states must address the structure of their teacher pension systems as well as their school funding formulas. Teacher pensions are a key feature in the broader education equity debate.

This 40-Year-Old Supreme Court Case Allows States to Fund Schools Inequitably

People sue the government for discriminating against them all the time. The Trump Administration was recently sued by a handful of states after the attempted travel ban, claiming religious discrimination. The owners of Hobby Lobby sued the Obama Administration arguing that the Affordable Care Act (ACA) violated their religious freedom by requiring the company’s insurance to pay for contraception.

Lawsuits against state governments for school funding inequities are commonplace. In February Chicago Public Schools (CPS) sued Illinois Governor Bruce Rauner claiming that the state school funding system and its teacher pension system discriminate by underfunding low-income students and students of color. They have a point: a recent study found that Illinois operates the most inequitable school funding system in the country. CPS educates around 20 percent of the children in the state, yet it receives roughly 15 percent of state funding. While the judge recognized that Illinois’s school finance system is obviously broken, he nevertheless threw out the case.

Photo by Andy Blackledge

So what can affected children and families do now?

The short answer is nothing. Although Judge Franklin Valderamma is allowing the plaintiffs to refile their case, the efficacy of school finance litigation, regardless of a court’s ruling, depends entirely on the state’s willingness to right a wrong of its own creation. In other words, those treated unjustly by a state school finance system must hope that their abusers change their ways without any way for the state to be held accountable.

This latest case in Chicago raises the specter of San Antonio v. Rodriguez from 1973, in which the U.S. Supreme Court ruled that there is no Constitutional right to education. The court also ruled that wealth (economic status) is not a protected class, unlike race or religion, and therefore is not subject to the strict scrutiny test, the most demanding form of judicial review. This means that the constitutional rights’ of low-income people are not afforded the highest level of protections when weighed against the government’s interest.

There are several serious consequences of Rodriguez. First, state courts are more likely to rule in the state’s favor even if the system discriminates against low-income students. Second, the hands of the federal government are basically tied when it comes to inequitable state school finance systems. Thus, if a state ignores a court order to improve its school finance system, families have no recourse. They are stuck. Third, school funding systems based on local property taxes, which comprise virtually every system in the country, are constitutional, even though they produce class-based disparities.

Due in large part to Rodriguez, there have been over 40 years of school finance litigation that struggle to produce sustained results increasing equity. Texas has been in and out of court since Rodriguez was decided. The state took action in response to a court order, and then rolled back those policies. The pattern continues to this day.

For a more recent example, consider the victory of the Campaign for Fiscal Equity in New York. The plaintiffs won a strong pro-equity ruling, and the state of New York responded positively. Good news. The problem, however, was that shortly thereafter, the state’s commitment wavered and eventually buckled. Now students are back in the same situation they were in previously.

The problem is similar in Washington State, where the state supreme court held the legislature in contempt of court for failing to comply with their order. And when the legislature has proposed changes, the court has continuously rejected them as far too insufficient to repair their broken education finance system. The court is doing the right thing here, but the buck stops with the legislature.

And although there is no silver bullet that could suddenly end disparities in school funding, overturning Rodriguez would provide a significant boost for equity. The federal government would then be able, as it does with voting rights, to ensure that all students have equitable access to the necessary resources for a high-quality education.

Four Problems With Betsy DeVos’ Possible Vision of School Accountability

Secretary of Education Betsy DeVos

During her Senate hearing, now Secretary of Education Betsy DeVos repeatedly stated that she supports school accountability. But what does accountability actually mean to her? For clues, I looked into the model school choice legislation proposed by the American Federation for Children (AFC), an organization DeVos formerly chaired. If that bill reflects DeVos’ priorities, it suggests she supports accountability measures that are significantly weaker than the ones currently applied to public schools in all 50 states.

There are at least four key accountability problems with the AFC’s voucher program:

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Education Funding is a Potential Rural-Urban Partnership Despite Post-Election Divisions

Donald Trump’s election made clear that the division between rural and urban communities is widening. Although social media and other technologies connect us more than ever before, rural and urban communities increasingly feel that they are misunderstood by the other. Trump further polarized this divide. Since people living in cities and those in small towns and rural areas have such starkly different experiences and views about what direction the country should take, it is hard to imagine finding common ground.

But on the issue of school funding, rural and urban communities are natural allies. In fact, students and families in cities and rural areas have far more in common than their voting patterns might suggest.

Both rural and urban communities often lack the resources necessary to provide their students with a high-quality education. Students in rural and urban communities are disproportionately low-income, and as a result, these students frequently face significant barriers to academic success. For example, students in both areas experience high rates of poverty. Like many urban schools, schools in rural communities and small towns also typically have less access to effective teachers, advanced curricula, and many of the other hallmarks of a good education.

Inequitable school funding undergirds each of these disparities. The simple fact is that compared with suburban districts, rural and urban communities just don’t get their fair share of school funding despite serving high concentrations of disadvantaged students. In most cases this is due to how states and school districts fund their schools. The majority of state funding formulas are regressive or flat. In other words, they’ve got it backward. They provide as much or more funding to schools that are already more affluent. The United States is one of the few modernized countries in the world that provides fewer educational resources to lower-income students than more affluent ones.  

At the district level the problem is compounded.

In most school districts, school funding is based largely on local property taxes. Places with low property values such as rural communities typically lack the wealth necessary to generate sufficient education funds on their own. And while some property-wealthy places such as cities have a much greater property tax base, many still cannot generate enough revenue to adequately fund their schools due to their relatively low incomes.

This is not to say that all states and districts refuse to adjust their formulas to better meet the needs of their students. On the contrary, places like New Jersey and Boston, Massachusetts restructured how they fund their schools to significantly benefit low-income and other disadvantaged students. Unfortunately, these places are the rare exception and not the rule.

Despite both suffering from school finance inequity, rural and urban districts rarely work together to address their shared problems. This is because they are often pitted against each other when states are restructuring their funding formulas. Education dollars are treated as a zero sum game: if urban districts win more funding, it must come at the expense of rural districts. And vice versa.

But it doesn’t have to be this way. Continue reading

New Dept of Ed Rule Doesn’t Go Far Enough, Would Leave Large Funding Gaps Intact

The U.S. Department is in the midst of a fight to send more money to poor schools. Centered around a complicated legal provision called “supplement not supplant,” they originally proposed a strong rule that would have meant significant new resources for low-income students. But due to pushback from an odd coalition of Republican congressmen and the two national teacher unions, they’re now proposing a weaker, clunkier version that could potentially leave large funding gaps intact. With the rule now out for public comment, the Department has an opportunity to go back to its original version, better protect low-income students, and more closely reflect the actual text of the law.

Before we get into the details of this specific regulation, it’s important to acknowledge that public education in America isn’t fair. The quality of a student’s education is too often determined by his or her zip code. Growing up in a low-income community often means crumbling schools, inexperienced teachers, weak curriculum, and few extracurricular or enrichment opportunities.Uphill climb

A big part of the problem is how states and districts fund their schools. While low-income students should receive more money to help offset the harmful consequences of growing up poor, that’s not what most states and districts do. In some states, the disparities between high- and low-poverty districts amount to over $1,000 per-student. This isn’t mere “bean counting” for schools—these differences can easily reach more than $1 million each year.

It doesn’t have to be this way. Continue reading