Category Archives: School Finance

Mayor Dave on the State Finance System

Mayor Dave Cieslewicz knows the primary source of Madison’s school budget woes. Published in Southern Exposure, the newsletter of the South Metropolitan Planning Council and elsewhere.

Thomas J. Mertz

School Funding System Needs Reform
By Mayor Dave Cieslewicz

“The worst choice, except for all of the others.”

This is what comes to my mind when reflecting upon the recent budget challenges that Madison school district leaders, parents and students have faced. After the recent, difficult debate over the issue of school consolidations and other painful budget measures, there can no longer be any doubt that the school funding system is broken beyond repair.

As the school district correctly notes, thanks to this broken system, they are trapped within a spiral of budget shortfalls and cuts to programming. Although they were able to avoid consolidating schools this year, they were nonetheless forced to reduce resources for special education, increase class sizes, and make a number of other cuts that threaten the quality of our public schools. This is a pattern that has been continuing, and worsening, for a number of years.

This is not to be critical of the school board or the administration. I know from experience how difficult these budget decisions can be, and am confident they are making the best decisions they can, given the hand they have been dealt by the state. There are no more easy choices or easy cuts to make. We are well beyond the point where platitudes such as “finding efficiencies” will make the budget balance.

Until we see reform at the state level, we will face these same decisions, and our community with go through the same difficulties, year after year. School district leaders know this, and embarked earlier this year on a campaign to build political support for ending the current, unfair system.

The City of Madison is answering that call, by making school funding reform a central part of our legislative agenda. For starters, the revenue caps must go. I am a strong believer in local government and local accountability. We in Madison are perfectly capable of making local budget decisions and choosing local leaders who reflect our values.

The next step is to create a new system that provides fair and adequate funding for our public schools. I am encouraged that every Madison-area legislator has signed on to a resolution calling for a new system to be in place by July 1, 2009.

The resolution specifies four key components of a new, fair system: it must provide funding based on the actual cost of education, not arbitrary per-pupil formulas; it must provide adequate resources to educate all of our children, regardless of their background; it must provide additional resources for special needs, such as non-English speaking students; and it must be based on a fairer tax base that moves us away from reliance upon the property tax.

These are all important goals. Until we achieve them, the turbulence our community experienced during this year’s school budget will not only happen again, it will get worse. And once again, we will be forced to make “the worst choice, except for all the other ones.”

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BOE Contract Vote

Three Board of Education members voted against the MTI contract on Monday, June 18, 2007. My initial reaction was that it was a ‘free” vote, a vote without consequences. When elected officials know that there are sufficient votes to pass or defeat a measure they can use their votes to make a statement without taking responsibility for what would happen were they to prevail. This is what happened on Monday, those who voted against the contract knew that it would pass and that they would not be held responsible for the serious consequences that would ensue had they been in the majority. Upon reflection, I realized that in fact the vote has the consequences of exacerbating divisions among our teachers that are hard to justify based on their stated rationales for opposing the contract.

What would have happened if the minority had been the majority, had the contract been voted down after the union had already ratified it? Negotiations would have continued in some form, perhaps simply the preparation of final offers to submit to arbitration. At the Board meeting Superintendent stated that under those circumstances he would have requested the appointment of a new negotiating team. That certainly would have lengthened the process and meant the allocation of additional resources. Superintendent Rainwater and all of the Board members who spoke to the matter were in agreement that the contract was within the guidelines that the Board had given the negotiating team. This raises the possibility that voting down would have been considered a violation of the obligation to bargain in good faith. If that had happened, the union would have gained a big advantage in the continued negotiations. From the district point of view, none of these are good things.

Those who voted against the contract expressed their dissatisfaction with the fact that continuing the basic healthcare framework (WPS and GHC, with most of the cost differences paid by the district) limited the district’s ability to increase salaries. Further negotiations would not have changed this. The impasse agreement in place indicates that the negotiations had passed the deadline where they were required to submit the issues to binding arbitration. Anecdotally, arbitration is rarely desirable for school districts; the terms of the impasse agreement precluded “any modifications of Section VII-B of the Collective Bargaining Agreement, i.e Group Health Insurance.”

I doubt the minority voters would have voted against the contract if there had been any possibility that it would have been rejected; looking at where that would have left the district I am glad there was no possibility.

Those who voted against the contract had previously spoken against the impasse agreement, contending that the district had surrendered a “huge bargaining chip” in the battle to reduce health care costs. It has been explained before that very little was surrendered and that the district received concessions from MTI in return, but this message does not seem to have gotten through. In exchange for an agreement by MTI not to authorize job actions (including “work to contract, which would kill extracurriculars) the district agreed not to impose a Qualified Economic Offer and to remove health insurance and some other issues from potential arbitration (the impasse agreement also set a calendar and included some other conditions, but I don’t know whose interests these favored, perhaps both). A Qualified Economic Offer must maintain, “fringe benefits in effect 90 days before bargaining commenced” and “district percentage fringe contributions then in effect.” In other words, it is impossible for a QEO to change health care benefits in any way. The new contract contains some changes and in this way comes closer to satisfying the expressed desires of those who voted against it.

The two ways to win concessions on healthcare are via negotiations or arbitration. MMSD “gave away” the option of unconditional arbitration (and won some concessions via negotiations). Robert Butler of the Wisconsin Association of School Boards (and MMSD bargaining team) cautions “careful consideration” before risking arbitration and identifies four conditions that should be present before a district contemplates this option: “excessive postemployment benefit costs, high health insurance premiums, declining enrollment and a small fund balance.” In comparison to districts around the state (the comparables that an arbitrator would use), MMSD clearly doesn’t meet two of these conditions (postemployment costs and declining enrollment) and is borderline on the others. Seeking healthcare concessions via arbitration does not look like a winning strategy. So much for the “huge bargaining chip.”

Those who voted against the contract gave four reasons that I recall. I’m unclear about the one that had to do with retirees. Another had to do with a quickly corrected misstatement in MTI’s summary of the terms. The healthcare benefit/salary ratio and the supposed effect of this on MMSD’s competitiveness in attracting and retaining quality teachers was the big one and this was linked to the last: concerns about the turnout at the union contract ratification vote. Although members of the minority averred of a desire to “interfere in internal union politics” it is hard to see these last three as anything else (and additionally a way to score points with anti-union voters in future elections).

Before turning to the effect of this attempted interference, I want to quickly address the realities of MMSD’s competitiveness. I’m second to none in my desire for well compensated teachers (salaries and benefits). Both the 1% salary increase and the 4% total package increase are less than I wish the district could provide, but the state finance system doesn’t allow that. The implication is that MMSD salaries are not competitive or will soon cease to be competitive. All evidence is that this is not true. The Wisconsin Association of School Boards collects salary data from districts. In 2006-7 out of 104 districts reporting, MMSD ranked 20th in BA starting salary; 10th in BA and 6 years; 7th in BA max; 39th in MA base; 33d in MA and 9 years; and 43d in MA max. MMSD recently had the highest starting salaries of any surrounding districts. National surveys show that Wisconsin salaries now lag behind those of other midwestern states and MMSD salaries (higher than the state average) seem to be at about the regional average. If MMSD does have difficulty attracting teachers (and I have yet to see any evidence that this is true), I would guess that it is because potential recruits recognize that the state finance system works against job security by forcing “last hired, first fired” cuts. I think that working toward state finance reform will be more effective in raising our teacher salaries than symbolic votes and unsupported assertions about salary competitiveness.

Various school board members have sought to undermine the solidarity of the union by focusing on the differential benefits of those who choose various health plans and have gone so far as saying that it is the “early and mid career” teachers they care about (presumably to the exclusion of our most experienced staff). Exacerbating these divisions is one consequence of their votes against the contract. The success of our schools depends on our teachers working together as teams. Pitting one group of teachers against another can destroy the collegiality of our teaching staff and harm the education of our children. I guess that a minority of the Board thought the benefits of their symbolic vote justified that risk (I am not clear what the supposed benefits are, maybe exacerbating these divisions, but that would be interfering in union politics and they said they weren’t doing that…it gets confusing).

There were also numerous references to the “low” turnout at the union ratification vote. One board member said the turnout was 1%, the number floating around now is about 100 union members voted the only news report I’ve seen put the number at “about 200” or a bit under 10%. Not a huge turnout but also in no way evidence that some silent majority of the union opposed the contract. We hear a lot about MTI’s supposed failure to represent the interests of the membership. If this were true, if dissatisfaction were widespread then it should have been easy to mobilize 200 teachers to vote against the contract. The voices of dissatisfaction point to short notice as a reason for their failure to mobilize. The MTI Bargaining Committee is elected by the membership and there is plenty of notice for those elections. The committee has 15 positions, with 5 up for election each year. This year and last only one of those seats was contested. The Lord helps those who help themselves, but apparently three school board members want to help those who can’t be bothered to help themselves. Maybe they should consider the union members as adults, fully capable of understanding and acting on their interests and not arrogantly seek to undermine the expressed will of the teachers via the established procedures of their legal agent instead of trying to impose what they think is best for others.

I can imagine circumstances where the best interests of the district require the consideration of going to arbitration in an attempt to gain a better contract than what the QEO requires. That is not what happened here (there is little hope of a better contract and no hope on the issues raised by the nay voters) and these circumstances do not exist in MMSD.

I’m tired of writing about health insurance, teacher contracts and the QEO. I’d much rather spend my time and energy on other things. However, as long as some insist on continuing to play political games by using this issue, I’m sure I will continue to put in my 2 cents.

Some are praising those who voted against contract. I hope that this post makes the following clear:

1. The stated goals of those voting against the contract could not be achieved via continued negotiations.

2. Voting down the contract would have weakened the district’s bargaining position and may have led to a ruling that the district had not met good faith criteria.

3. The members who voted against the contract did so knowing that they would lose and they would not be held responsible for the above.

4. Health care savings cannot be achieved by imposing a Qualified Economic Offer.

5. The possibility of arbitration without conditions that the impasse agreement took off the table offered little hope of achieving the stated goals of those who voted against the contract and opposed the impasse agreement.

6. All the evidence indicates that MMSD salaries at all levels, but especially at the lower levels, are competitive.

7. The vote against the contract and the accompanying statements undermine teacher collegiality and morale, to the detriment of our children.

8. Teachers who are dissatisfied with MTI’s bargaining goals and the contract have made little effort to change the former or block ratification of the latter.

There is nothing praiseworthy and much to condemn in what the minority did and their use of unsupportable claims to justify their actions.

Thomas J. Mertz

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Quote of the Day (consider the source)

From this morning’s Wisconsin State Journal story on the Republican effort to reduce taxes in Wisconsin’s biennial budget (Paul Soglin has more).

Bill McCoshen, a lobbyist and former Commerce secretary under Gov. Tommy Thompson, said the [Republican controlled] Assembly could be forced into making it harder for the needy to qualify for Medicaid health coverage or not increasing state money to schools.

You’ve got to love the language: “forced.” Yep, the Republicans don’t want to reduce the level of school aid below the already inadequate formula or take healthcare away from the neediest, they are being “forced” to. Who is doing the forcing? McCoshen isn’t saying, but two answers suggest themselves. Either it is the Republican themselves, which brings to mind the image of Cleavon Little in Blazing Saddles holding a gun to his own head and threatening to kill himself.

Or is it Republican lobbyists and strategists, like Bill McCoshen, and the donors they represent who are doing the “forcing”?

A closer look at McCoshen’s ties gives some clues as to why he might want to obscure the “forces” who value tax reductions more than providing essential state services. His current lobbying client list is here but at this point in the session it lacks the dollars and hours details. The list from the last session is much the same and includes links to that information. Previous sessions can be accessed here. Interestingly, the 2003 reports do not list McCoshen’s efforts on behalf of the Dairy Business Association to secure passage of Assembly Bill 466 and thereby further limit the taxing power of local entities, including school boards. Reduce state taxes, reduce local taxes, reduce them both, and don’t worry about the consequences for schools or those needing healthcare.

Also of interest in understanding how McCoshen does business and whose interests he looks after (hint, it isn’t the children of Wisconsin and those in need of healthcare) are the $46.5 million his firm was to “earn” lobbying for Dennis Troha’s failed, tainted casino bid, but that’s another story; this is about public school funding.

One McCoshen Client, is K12 Inc., a firm specializing in homeschooling and distance learning software (founded by William Bennett, who resigned after his “abort every black baby” to reduce crime remarks, but not before his use of influence to to gain profits from the company’s relationship to an Arkansas virtual charter school via a misapplied Education Department grant subsidizing homeschoolers were raised). In Wisconsin McCoshen, on K12’s behalf to the tune of over $160,000, sought an expansion of and easing of rules for virtual charter schools, while increasing state fiscal obligations.

Wal-Mart is on the list of McCoshen’s clients. See here for their contributions to education.

McCoshen’s firm also collected over $10,000 by consulting on the recent Janesville school referendum campaign. Small change in McCoshen’s world, but small change that depends on the continued existence of a state finance system that requires referenda to meet the needs of the state’s students.

What I see are new twists on the “starve the beast” game that the GOP has played for years. The idea is to deny the schools the money they need to do their job and then point out how they are failing to do their job in order to further defund them or eliminate public education altogether. The new twists involve deviating from the anti-tax stance when there are profits to be made, either via charter schools or by consulting with referenda campaigns.

May the force desert McCoshen and the Assembly Republicans.

(revised 6:13 PM, 6-15-07)

Thomas J. Mertz

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Filed under AMPS, Gimme Some Truth, Local News, Quote of the Day, Referenda, School Finance

MMSD, MTI Tentative Contract

Madison Metropolitan School District and Madison Teachers Incorporated have reached a tentative agreement (The MMSD BOE must approve in open session on June 18th and MTI must ratify). The contract calls for only a 4.0% total package increase, slightly above the QEO required 3.8, but well below recent statewide trends and the most recent statewide average of 4.29%. If my calculations are correct the difference between the state average and the proposed contract amounts to almost $800,000 annually.

It should also be noted that the contract includes an increase in health care co-pays and movement in the direction of wellness and other preventative measures to reduce health care costs. Health care costs still take up the bulk of the package increase, but under the QEO that is the union membership’s prerogative.

All in all, I think that given the budget situation it is a good contract.

Maybe those who sought to make political hay out of the impasse agreement and have misrepresented the realities of the negotiations would like to comment now.

Thomas J. Mertz

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Quote of the Day

To get more Americans to enroll in and complete college, the theory goes, you can either fix the schools (more teachers, longer school years, more student loans) or fix the students (more nurturing of kids from disadvantaged homes). Both approaches would cost a lot. But if you’re worried about inequality, it’s hard to see any alternative. Hamburger flippers simply don’t command a high wage. We can pass laws to change that — a minimum price for cheeseburgers, maybe — or we can, finally, invest in teaching the flippers to do something else.

<a href=”http://www.nytimes.com/2007/06/10/magazine/10wwln-lede-t.html?
ref=magazine&pagewanted=print”>Roger Lowenstein (from the New York Times Magazine).

Thomas J. Mertz

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Another casualty of Wisconsin’s broken school funding system

I want to clarify the facts about the Madison School Board’s decision on private school busing.

This is a financial budget change with no hidden agenda. This is not about “us versus them.” This is not about Madison schools being “afraid of diversity.” We embrace diversity. Visit any of our schools and see for yourself. This is not about the board wanting the private school children to bring in $13,000 of additional funds per child (an inaccurate number, by the way). In our deliberations, the School Board never discussed any of these topics.

This is, sadly, a matter of a state budget system that does not allow school districts in Wisconsin to provide adequately for their students … across the board.

Due to state-imposed revenue caps, the Madison Metropolitan School District has made substantial budget cuts each year since 1993. We are at a point when no cut is good.
This year the board’s Finance and Operations Committee closely examined areas of our budget that have high dollar expenditures. Transportation was one of these areas. The cut to the private school transportation was recommended as were cuts to busing for some of our middle schools.

State law permits the district to offer Parent Contracts to the private schools (payments to parents) when the cost of busing is more than 1.5 times the district’s average cost of busing. The private school families will be reimbursed about $453 per child for driving their children to school. The public school families do not receive such reimbursement.

People state that we are unfairly targeting the private schools in our budget cuts. This is simply not true. This year we have cut special education services, student support services, and programs. We have increased class sizes at all levels. The list of cuts is quite lengthy. At a recent board meeting we had the horrible task of approving the layoff of teachers due to budgets cuts.

People state that we “owe them” because they pay property taxes. The public schools in Madison benefit the entire community. Good schools are the cornerstone of a thriving community. Providing options for children, developing a well educated work force and bringing new businesses to Madison are some of the benefits schools bring to all of us. In addition, good schools = good home values = good investment. Our schools benefit the MMSD community irrespective of whether or not your child attends one of our schools. It’s the big picture.

The MMSD administration has told the diocese of our willingness to work with them to lessen the impact of these changes. We have offered to manage bus routes and provide information necessary to make alternative plans. It would require the diocese to pay part of the costs. I hope they will consider this seriously.

There is not one of us who feels comfortable with the level of cuts we now have to make each year. As a community, we have to work together to convince our legislators that we need a new system to fund our schools.

Our children, irrespective of where they attend school, deserve adequate funding.

Arlene Silveira, president, Madison School Board

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Everyone has a stake in the schools.

Mary Conroy: Make business pay fair share of taxes (excerpts), the Capital Times, May 22, 2007

Every year, Madison’s School Board gets a tsunami of suggestions on balancing the budget. And that’s as it should be: Everyone has a stake in the schools. It doesn’t matter if you have children, hire graduates or pay property taxes. It doesn’t even matter if you live in Madison.

Far-fetched? Not at all. Public schools are the building blocks of democracy. They are the foundation of our economy. They foster the curiosity that leads to discovery, the creativity that sparks new ideas, the social skills that build strong communities.

But our public schools are now in peril. Statewide, we’ve had one referendum after another. School districts have taken drastic measures, from slicing staff to slashing class offerings, from selling property to shutting schools. Citizens and school boards alike have initiated unusual ways to save money.

We need to take school budgets off the property tax rolls. Currently, our property taxes are so high that people on fixed incomes can’t afford to stay in their homes, even though they’ve already paid their mortgages. It’s not that older residents are against paying school taxes. Some of us on fixed incomes, including me, have never voted against a school referendum. But we may have to if Wisconsin legislators don’t act soon.

For quite some time, Wisconsin Manufacturers & Commerce has pressured the legislature to lower the total tax burden on corporations. If corporations here paid taxes at the national average, we’d have almost $1 billion in extra funds, according to a recent analysis by Jack Norman, research director at the Institute for Wisconsin’s Future.

Consider these facts:

In 1977, homeowners paid 50 percent of all property taxes. Now they pay 70 percent, because businesses pay so much less.
Twenty years ago, the corporate income tax produced 10 percent of state revenue. Now it pays about half of that.
Most Wisconsin corporations pay no corporate income tax, according to the Department of Revenue.
The worst thing is that the state Legislature has enabled businesses to avoid paying their fair share of taxes. It exempts some businesses from sales taxes. It gives tax credits for research, development and investment in “development zones” (including some areas in which developers would build anyway). The Legislature also exempts manufacturing equipment and business computers from the property tax.

Even ATM machines qualify as computers for that exemption.

Who’s making up for what corporations are too cheap to pay? Lower- and middle-class residents are. As a result, they can’t afford to send their kids to college.

It’s not enough to ask state legislators to make corporations pay their fair share of taxes from now on. It’s time for corporations to pay more than the rest of us do. After all, they’ve been paying less than we have for far too long.

So write to your representatives. Tell them to stop being puppets of the business lobby. Ask them why you should meet your tax duty while corporate Wisconsin gets away with murder.

Mary Conroy is a Madison-based freelance writer.

Thomas J. Mertz

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Good News from JFC

The Joint Finance Committee dealt with some education matters today and the news is mostly good. The Special Education categorical aid increase proposed by Governor Doyle advanced intact, as did the SAGE funding. GOP attempts to make the revenue caps more draconian, via a permanent annual increase limited to $100 failed. Much more at WiscPolitics, including this from Madison’s own Mark Pocan:

Rep. Mark Pocan, D-Madison, mocked the Republicans’ budget cutting proposals, saying their “rhetoric on taxes” and “zeal to reduce government” is at odds with the priorities of the people of the state.

“You’re like a teenage girl who sees Brad Pitt, but in your case it’s when you see Grover Norquist,” Pocan said.

The reality of the Republican proposal is it will lead to school closings and consolidation, larger class sizes, and program cuts, he said.

“This is a cut in education no matter what way you try to paint it,” Pocan said.

I’m proud to say that he is my Rep.

Other “good” news is the Republicans Luther Olsen and Alberta Darling sided with Democrats on key votes. Olsen and Darling are not my favorites, but they were both members of the Special Joint Committee to Review the School Aid Formula and they heard and listened to the realities created by our broken system. They might not “get it” all the way, but their heads are out of the sand.

The letters, emails, calls, visits all helped. Keep the pressure on!

Thomas J. Mertz

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ABC Madison Meeting, 5/16

ABC Madison is the group that has emerged from the state funding advocacy work of the BOE Communication Committee. We will be meeting on Wednesday May 16th at 6:30 PM in the Doyle Building, rm 103.

Please join us and spread the word.

Thomas J. Mertz

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Part of the problem

This reporting below is symptomatic of a larger issue that we have been unsuccessful at conveying to our state legislators so far, the need for fundamental school finance reform. It’s not a question of taking money from one school and giving it to another. It’s about funding all our schools adequately. This issue really comes down to a question of our future priorities as a society. The quicker we get the dialogue shifted to a new level of discourse, the quicker we will see real and sustainable reform.

A legislative resolution calling for school funding reform by July 2009 is purely politics and won’t get to a vote in the Assembly, a North Woods legislator said Friday.

State Rep. Dan Meyer (R-Eagle River) said school funding reform is such a difficult issue that little progress will be made until the governor’s office makes it a priority.

“The problem is that we’ve got 99 Assembly people who are all representing different school districts,” said Meyer. “I’d support it if my district got more money, but then we’d be taking from someone else. Do you think Milwaukee will jump up and down and support it? Not if they are going to lose money.”

The statements came in response to Assembly Joint Resolution 35 and Senate Joint Resolution 27, which call upon legislators to reform the school aid formula by July 1, 2009. They were co-authored by Sen. Roger Breske (D-Eland) and Rep. Sondy Pope-Roberts (D-Verona).

The resolutions say that the present funding system is not working, problems are aggravated by declining enrollment, more and more referenda are being held to exceed revenue limits, and it is the job of the Legislature to change it.

Meyer, who sits on the powerful Joint Finance Committee, said budget hearings across the state have attracted teachers and school administrators who all have the same message: The formula needs to change and they need more money.

“A lot of that testimony came from educators in areas of the state where they get a lot more aid than schools in my district,” said Meyer. “The problem is, none of the schools are happy even though more than 50 cents of every state tax dollar goes to education.”

Robert Godfrey

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Filed under AMPS, Gimme Some Truth, Pope-Roberts/Breske Resolution, School Finance, Take Action, We Are Not Alone