Category Archives: finance

Quote of the Day — The Bailout We Need

school_funding

Our preoccupation with the immediate crisis of financial capital is causing us to overlook the bigger crisis in America’s human capital. While we commit hundreds of billions of taxpayer dollars to Wall Street, we’re slashing our outlays for public education….

The result, across the nation: Teachers are being laid off and new hiring frozen, after-school programs cut, so called “noncritical” subjects like history eliminated, schools closed, and tuitions hiked at state colleges and universities.

It’s absurd. We¹re bailing out every major bank to get financial capital flowing again. But we¹re squeezing the main sources of our nation’s human capital. Yet America’s future competitiveness and the standard of living of our people depend largely our peoples’ skills, and our capacities to communicate and solve problems and innovate ­ not on our ability to borrow money.

Robert Reich, “Of Financial Capital and Human Capital: Why We’re Bailing Out Wall Street While Allowing Our Schools to Get Clobbered.”

Thomas J. Mertz

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Building on Victory – Next for CAST

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Join with CAST to raise school finance reform to top of the agenda!

The referendum passed – thanks to all for your support and hard work! Now it’s time to turn our energy to school finance reform!

Without changes in the way Wisconsin finances schools, Madison and other districts will face a future of continued budget cuts and divisive referendum battles. Our local state legislators supported the referendum and support fair funding for schools. We need them to put school finance reform on the top of their agenda for the next state budget.

Please join CAST on Wednesday, Dec. 3rd 6:30pm at Hawthorne Library and help plan an event at the State Capitol in early January to meet our legislators and ask for their leadership.

Let’s plan a creative and constructive action that involves everybody– kids, parents, educators, grandparents. Bring your ideas!

Hawthorne Library is located at 2707 E. Washington Ave., 246-4548, See for this link for directions.

If you have questions or cannot join us on Dec. 3rd, but have an idea or want to be part of the event in January, please contact Jill Jacklitz at madisoncast@sbcglobal.net

Community and Schools Together

Thomas J. Mertz

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It depends on how you ask

telephone_antique

Johnny Thunders, “Ask me no questions” (click to listen or download)

A new press release from the Wisconsin Policy Research Institute propaganda mill trumpets “WISCONSIN RESIDENTS OVERWHELMINGLY OPPOSE RAISING TAXES ON BUSINESSES.”  Further down is the actual wording of the question asked of 600 Wisconsin residents: “Business profits are down throughout Wisconsin and many businesses are reducing their workforce. In this environment should state lawmakers increase the tax on businesses?”  This is what is known as a push poll, a “poll” where selected information is provided in order to shape the responses.  People who conduct push polls are not doing research, they are seeking to influence opinion.  People who conduct push polls should be shunned, not trusted.

Imagine how different the results would have been if instead of the dubious and vague claims about profits and layoffs (unemployment has been steady in our state) the respondents had been told about a 2006 Associated Press study that found “Wisconsin companies saw their profits grow more than twice as fast as their state and local tax bills over a two-decade period.

Instead of playing games with push polls, anyone who is serious about public policy in our state should be spending some time with a new report from the Wisconsin Council on Children and Families and the Institute for Wisconson’s Future entitled Catalog of Tax Reform Options for Wisconsin.  It is clear that there are many ways we can improve our tax policies and generate the revenues needed to fund education and other things the way we should.

Thomas J. Mertz

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Quote of the Day – Priorities

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If one accepts the reasonable principle of supporting the new president whenever he makes policy from the left or addresses basic social needs, shouldn’t progressives be cheering the White House as it rolls out the dozers, Cats and big cranes? Aren’t high-speed mass transit and clean energy the kind of noble priorities that best reconcile big-bang stimulus with long-term public value?

The answer is: no, not at this stage of our national emergency. I’m not an infrastructure-crisis denialist, but first things first. We are now at a crash site, and our priority should be to save the victims, not change the tires or repair the fender, much less build a new car. In the triage situation that now confronts the president-elect, keeping local schools and hospitals open should be the first concern, rebuilding bridges and expanding ports would come next, and rescuing bank shareholders at the very end of the line.

Inexorably, the budgets of schools, cities and states are sinking into insolvency on a scale comparable to the early 1930s. The public-sector fiscal crisis — a vicious chain reaction of falling property values, incomes and sales — has been magnified by the unexpectedly large exposure of local governments and transit agencies to the Wall Street meltdown via complex capital lease-back arrangements. Meanwhile on the demand side, the need for public services explodes as even prudent burghers face foreclosure, not to speak of the loss of pensions and medical coverage. Although the public mega-deficits of California and New York may dominate headlines, the essence of the crisis — from the suburbs of Anchorage to the neighborhoods of West Philly — is its potential universality.

Mike Davis, ” Why Obama’s Futurama Can Wait: Schools and Hospitals Should Come First in Any Stimulus Package.”

Thomas J. Mertz

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Madison Referendum: More Than Affordable…

Successful Recurring Recurring Referenda as % of Revenue Limits, Nov. 2004 - Nov. 2008.

Successful Recurring Recurring Referenda as % of Revenue Limits, Nov. 2004 - Nov. 2008.

For a number of reasons, I’m fairly confident that the MMSD referendum will pass.  In fact, I still think that Madison could have and should have passed a larger referendum.  I’ll start with the could have and then revisit some of the should have.

The graph at the top of the page shows successful recurring operating referenda since November, 2004 as percentages of the district revenue caps in place at the time of the votes (operating referenda linked to building projects were not included, the final total price was used for multi-year recurring referenda, $13 million in Madison’s case).  The pending Madison referendum is in red.  This referendum represents 4.98% of the district’s revenue limit; the average of all the successful referenda is 8.53%.  If Madison had asked for the average percent, it would have been an over $22 million referendum.  With $22 million, we could have restored valued programs, renewed the maintenance and technology revenue authority, realistically considered new ways to improve the education our district offers, and more.  The lesson here is that other districts, with much less of a culture of educational support, have passed relatively more sizable measures than we are considering.

For further evidence that Madison could have afforded more, we need look no further than the the recently approved 2009-10 budget and mil rate (district documents, here).  Due to greater than expected growth in the tax base, individual tax rates went down more than expected, from 9.92% to 9.81%.  This points to two important things.  First, the starting point for referendum-related tax increases is lower than anticipated.  Second, the quality of our schools continues to be a contributing factor to our healthy local economy.

Affordability is a matter of opinion and it is impossible to prove or disprove the outcome of offering the voters a larger referendum, but both the above pieces of evidence are suggestive of a positive prognosis.  With counterfactuals, that’s about as good as you can do.

I could offer at least 24,189 reasons why there should have been a larger referendum.  I just want to touch briefly on three today.  First, I do not believe that there are $3 million worth of cuts over the next three years that will not have a negative effect on the quality of education our district provides; second, there are many valuable things that have been cut in that past that I think should have been considered for restoration;  last, there will be a need for a maintenance referendum in 2010 and I believe that an extension of this should have been included.

When discussing the quality of education, it is always important to begin with the observation that we are a district with high needs.  We have a higher percentage of students with disabilities, students in poverty and English language learners than the state average (data can be accessed here and is summarized here).  These categories are important, because each of them are covered by underfunded mandates.  Because our percentages are higher and the mandates are underfunded, Madison must spend a higher percentage (than the average district) of our general operating revenue to address these needs.

This is part of the reason that I do not believe that after 15 years and over $60 million worth of cuts, $3 million more worth of “harmless” cuts can be found.   I am not naive enough to pretend that there aren’t programs and positions that are not as effective as they should be, but I do believe that there are also new and old ways that money reallocated from these budget lines could be used to improve the quality of our schools.  As framed by this referendum, any new ideas or restorations of old services will only be possible after $3 million worth of cuts are found.

In a letter to the Cap Times Steve Pike detailed some of the ways past cuts have harmed our schools.  I have touched on some of others here (as well as other places).  Both in local budget discussions and in the fight for state finance reform, I have repeatedly said “we cannot afford to cut more.”  I believe that.  I believe that many of the cuts that have already been made were harmful.  We have more deteriorating facilities, less current technology, larger classes, less community outreach and parent-teacher contact, a smaller variety of offerings, more difficult situations with specials classes, fewer support staff…than we used to have and and we should have.

The maintenance and technology renewal is somewhat different, but just as important.  The 2009-10 school year is the last year of the non-recurring maintenance and technology referendum passed in 2006.  In the 2010-11 year, MMSD will lose $5.5 million in revenue authority from this referendum (while adding an anticipated $4 million or $9 million — depending on how you count it — from the referendum on the ballot November 4).  The current referendum could have been offered so that this amount was included on a recurring basis, beginning in 2010.  This amount would have still left the referendum well below the average (as percentage of revenue limits) of passed recurring referenda pictured at the top.  As far as I can tell this possibility was never publicly considered by the Board of Education.  Because of this oversight, the district, the Board and the community will have to engage in an additional referendum process and campaign.

I’ve been campaigning on behalf of the referendum and will enthusiastically vote yes because the the alternative is so obviously wrong.  My enthusiasm will be tinged with regret that the referendum could have been bigger and better, could have provided more room for dreaming and less need for cutting.  I believe that a referendum like that would have passed also and our children and our community would have both benefited.

The referendum on the ballot is more than affordable, but less than it should have been.  Vote Yes for Schools!

Thomas J. Mertz

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News from CAST

From the Community and Schools Together website:

Many things going on and many new things on the web site.

We are in the last weeks of literature distribution.  Almost 20,000 homes have been reached, another 10,000 or so will be done this weekend (October 25-26) and next week we want to hit as many more as possible.

On October 25 and 26 we still need help in Fitchburg and in the Falk and Huegel areas.  Next week there will be lots of small things – including Maple Bluff and Brams Addition — and major pushes on the North side and to the South and West.

Without you volunteering, we can’t do anything.  Isn’t assuring that our schools avoid $13 million worth of cuts in the next three years worth an hour or so of your time?

To help, email madisoncast@sbcglobal.net or fill out this form.

New on the web site is an up-to-date Endorsement Page, including a letter signed by 49 local elected officials.

The Press/Media Page has also been updated, with videos, a radio interview, many editorials and opinion pieces, more do-it-yourself Advocacy material, and all the latest news reports.

Check out the district referendum pages also.

More updates coming soon.

Thomas J. Mertz

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We Are Not Alone #25 — Class Size and Segregation Edition

I’ve written about the Student Achievement Guaranty in Education (SAGE) as an underfunded mandate, and noted the trend toward increasing class sizes around the state, especially but not exclusively in districts where referenda have failed.  A report from Verona shows how vulnerable this proven educational practice is —  even in growing districts — under our broken system.

We all know that declining enrollment districts have been hit hard, but despite adding 100 students this year, Verona is considering dropping out or getting kicked out of SAGE, of denying their students the benefits of small classes in the early grades.

Verona is having troubles with the new strictness on the 15/1 ratio, and having troubles paying to keep this ratio out of general operating funds.  If they drop or lose SAGE, they will lose $850,000, but to comply with the rules would mean adding classes at an additional cost of $430,000. Even without the SAGE issue, Verona was looking at $600,000 in cuts for 2009-10. What’s a district to do?

Segregation is one very unfortunate solution.  The way this is reported is scary and not 100% accurate:

One choice would be to group low-income students at a couple schools and designate those as SAGE sites, as many districts – including Madison – already do.

SAGE contracts are limited and in recent years MMSD has cut local funds for class size reduction and moved their limited contracts to high poverty schools.  Madison has not embraced an affirmative policy of economic segregation and still gives some attention to seeking desegregation when assigning students.

Madison has also not embraced a policy of affirmative desegregation and I’ve heard no concern that the Third Friday Count showed Glendale at 80% low income, while the adjoining attendance area for Elvehjem is 25% low income.

The Equity Task Force asked the Board to consider having an annual report on economic segregation in schools and in class assignment.  They have never discussed this proposal  in an open meeting.

Like class size reduction, socio-economic diversity has yeilded positive achievement results.  These are becoming either-or-choices, when we all know we should do both.

Thomas J. Mertz

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24,189 Reasons — My Referendum Letter

To be sent to The Capital Times, The Wisconsin State Journal, The Capital City Hues, The Madison Times and maybe more (I may do another edit before sending).  Click on the links to send your own letter!

24,189 Reasons to Vote Yes

According to the official September census, the Madison Metropolitan School District serves 24,189 students.  The individual and collective futures of these students are the best reasons to vote yes on the November 4 operating referendum.

We have an obligation to these students to give them the best opportunities to flourish and to be part making their world a better place than the one we are leaving them.

The world we are leaving our children is a mix of good and bad.  We are a prosperous community in a prosperous nation, but there is great economic uncertainty and growing deficits and debts at all levels.  We have wonderful traditions of self government, but these traditions have been corrupted and our representatives are often ineffective or inattentive.  We have ideals of justice and equality that unite us, but are torn apart by divisions and inequality.  We think of ourselves as a world leader for peace and freedom, but our devastating mistakes have made us an embattled pariah at a time when cooperation is essential.

We need to give the coming generations the tools they need to build on the good and correct the bad.  We can do this in many ways, but strong public schools have to part of it.

Our community understands this; we value education and know the value of education.  Under the broken state finance system, referenda are how we can act on this knowledge to support the quality schools we want and need.

Our schools are very good, but far from perfect.  Fifteen years of trying to do more with less under a broken system have taken their toll.  We can all find things with the schools that we don’t like or think need to be done better, or more, or less.  The improvements we demand aren’t going to happen without the resources supplied by the referendum.

What will happen are more distracting struggles as the district tries to find the least harmful $13 million to $16 million worth of cuts over the next three years.

Dissatisfaction with particulars and desire for improvement aren’t reasons to vote no, they are reasons to vote yes.  Just like we need to give those 24,189 students the tools to make the world better, we need to give our schools the resources they need to build on the good and correct the bad.

Vote yes for schools, vote yes for a better future, vote yes for the 24,189 children who are depending on your support.

Thomas J. Mertz

Franklin-Randall and JC Wright Parent

Chair, Progressive Dane Education Committee

Take care of the children
The children of the world
They’re our strongest hope for the future
The little bitty boys and girls

Make this land a better land
Than the world in which we live
And help each man be a better man
With the kindness that you give
I know we can make it (I know that we can)
I know darn well we can work it out
Oh yes we can, I know we can can

“Yes We Can Can,” by Allen Toussaint, as performed by Lee Dorsey (click to listen or download).

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Moneyball

1969 Chicago Cubs, “Pennant Fever” (click to listen or download)

Willie Sutton supposedly once replied to the question, “Why do you rob banks?” with the answer “Because that’s where the money is.”

In his protests against the broken state school finance system in his state, the Illinois State Senator, Rev. James Meeks has shown a similar shrewdness.  The first week of school he led Chicago school children to the rich suburbs to register for school; he went where the money was and the reporters and cameras followed.  Now he has planned a protest outside the first playoff game at Wrigley Field (and here).  Good for him!

I’m sure tickets are going for thousands of dollars, I know that a beer costs $6.00 at Wrigley.  While the “haves” and others enjoy their good fortunes of having the opportunity to enjoy October baseball, it is a good thing that they be reminded that many of our children don’t have decent educational opportunities.

For more information on school finance in Illinois, see this page (and links) from the Access Network.  Like Wisconsin, they have a broken school finance system.  Illinois is also home to a very creative school finance advocacy organization, A+ Illinois.

For our readers in the Milwaukee area, the first home Brewers’ playoff game is Saturday at 5:30 PM.  Not to late to get a protest together.

And for any who care, I am a St. Louis Cardinals fan who spent a good deal of my youth and young adult years regularly attending games at Wrigley.  This post-season, I’m rooting for (in order) the Brewers, the Cubs and the White Sox.

Thomas J. Mertz

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Quotes of the Day – Broken System, Broken Record Edition (#1)

John Hartford, “Dont leave your records in the  sun” (click to listen or download)

Last week, Milwaukee Superintendent William Andrekopoulos strung together the words “State, “Finance,” “Schools,” “System,” and “Broken.” At AMPS, we’ve strung those words together in a variety of ways ourselves or quoted others using these words on more than one occasion.

It thought it might be fun to see who else has said this or similar things about school finance in Wisconsin, who else has given voice to the truth that in Wisconsin, the school finance system is broken.

Here we go, not comprehensive and in no particular order.

We need to do a better job of looking out for taxpayers, and we will. It means making work pay, by encouraging and fostering economic development that pays family-supporting wages and respects the environment. It means ensuring healthy communities, through public health programs and a new, more powerful and consumer-friendly, organization of how we buy prescription drugs and health insurance. It means fixing our broken system of school funding, and making an ironclad guarantee to every Wisconsin child that this state will give you a good start in life a quality education that enables you to succeed in tomorrow’s economy.

Governor Jim Doyle, 2002 victory speech.

The school finance system is broken and needs to be fixed or the quality of public education will suffer significantly.

Cooperative Education Service Agency #3, “Can Wisconsin avoid an educational crisis?” 2007.

Everyone agrees that the school funding system is broken.

Wisdom, “Education Position Paper,” 2007.

Wisconsin’s school-funding system is broken, it needs to be thrown out, and the Legislature needs to come up with a better plan…

Wisconsin PTA, 2007.

First, it’s clear that the school funding system is broken at the state level. I encourage you to join me in calling upon Governor Doyle and our state legislators to fix this broken system that every year forces school boards around the state to cut budgets.

Madison District 12 Alder, Satya Rhodes-Conway, 2007.

Wisconsin’s K-12 education funding system is definitely broken. After 15 years of living under revenue caps and a funding formula that leave school districts with an approximate 1% deficit every year, our schools are increasingly finding themselves having to cut programs and staff. This is especially true in our rural schools where declining enrollment is an issue.

47th Assembly District Candidate, Trish O’Neil, 2008.

The Oshkosh school system isn’t broken; the state funding formula is. I disagree that we have to “fix” our school system because of the budget problems the funding formula creates. Until the state changes the formula, we should ask through an annual referendum to exceed the state budget caps.

Oshkosh Board of Education Member, John Lemberger, 2008.

The current system of funding public education in Wisconsin is broken.

Milwaukee Board of School Directors President, Peter Blewett, 2008.

The school funding system is broken and it was created broken.

Professor Emeritus, Economics,  University of Wisconsin-Platteville, John Simonson.

Partners in WAES believe that Wisconsin’s school-funding system is broken beyond repair and should be linked to the needs of children, giving each of them—no matter where he or she lives—the opportunity to meet rigorous academic goals.

Wisconsin Alliance for Excellent Schools, 2004

School Funding is Broken

  • Mandates, needs and costs continue to grow faster than allowed revenues.
  • Annual service and program cuts of 1-2% over the last 14 years.
  • Over 100 districts in Wisconsin have held referenda in the last year.
  • After 14 years of cutting, essential services are in danger.

Community and Schools Together (CAST), Madison, 2007.

The system is broken. We’ll have to raise taxes.

Superior parent and school board member Kris Kintop, 2003.

We want to be clear that we are painfully aware of the broken system of funding public education in Wisconsin,

Madison Board of Education Member, Lucy Mathiak, 2007.

Wisconsin has conducted several studies on how we can fix the funding of our education system. Isn’t it time that the governor and Legislature start looking at those recommendations and consider other ideas instead of foolishly tinkering with the same old broken system?

Dave Zweifel, the Capital Times, 2007.

The school finance system is broken and needs to be fixed or the quality of public education will suffer significantly.

Dean Isaacson, Platteville School District Administrator, 2008.

Wisconsin is extremely fortunate to have one of the best public education systems in the country. But our school funding system is badly broken, and we are headed in the wrong direction. School districts throughout the state are cutting programs and staff and closing schools. Children have returned to school this fall to find fewer academic choices and larger class sizes.

If we are going to jump-start our economy, we need to find a better way to provide schools with resources to meet the needs of children so we can be assured that we are turning out future workers who can help our state’s businesses thrive.

Dan Burkhalter, Executive Director of the Wisconsin Education Association Council, 2007.

The state school finance system is “broken.

Pete Etter, interim superintendent, Black Hawk School District, 2007.

To be continued.

Thomas J. Mertz

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