To the Editor:

Education spending is a complex issue and cannot be quickly explained. But it takes a large part of our state budget, and more importantly, determines the future for our children, so we hope you will stick with us and read this rather long explanation.

Recently Representative Baudler wrote that an increase in state supplemental aid (SSA) for Iowa schools cannot be more than 1.25%. School district costs for doing business increase annually by 3% or more just to hold even with the previous year.  He explained how generous the Legislature has been with school funding and said that SSA had grown 22% in the last five years. Annual increases in the cost per pupil have actually been 2%, 0%, 2%, 2%, and 4% per child over that same time. That adds up to 10% not 22%. As with many claims, it’s all in how you look at the data.  Schools are funded by a combination of state, federal, and local dollars. If you only look at state funding and then you cherry pick the years to make your case, it might look like the state has been generous. But here’s the “rest of the story,” as Paul Harvey would say.

Federal stimulus funds of over $280 million were directed to Iowa in 2010 to prop up Iowa’s school budgets because of the recession. While there was an across the board cut in Iowa due to the recession, had those funds not been made available for education in Iowa, the cuts would have been far more dire. The $280 million had been allocated in the Iowa budget prior to the recession, but when the feds sent that money to Iowa, it supplanted Iowa’s responsibility for that funding for one year.  After that year, Iowa resumed the responsibility of paying that $280 million to local schools. So if you don’t acknowledge that for one year federal funds were substituted for state funds, your base year is 2011 when Iowa resumed the cost, and  you incorrectly assume the $280 million was new funding for schools, it looks like the state increased funding dramatically. If you start in 2010, you get quite a different picture. See the table below:

		State School Aid Total Appropriation	Dollar Change from FY2010	Percent Change from FY2010	Dollar Change from FY2011	Percent Change from FY-20 11
FY 2010		$2,587,500,001
FY 2011		$2,317,532,290
FY 2015		$2,873,761,312	$286,261,3111	11.0%	$556,229,022	24.0%

There is a Conference Committee currently meeting to resolve the House and Senate differences. The Senate came into the Conference Committee having first passed a 6% increase per pupil for FY 2016 for schools to make up lost ground back in the 2014 Legislative Session.  That bill died in the House.  The Senate then passed a 4% increase in school funding for FY 2016 this Session.  The House bill set an increase of 1.25%. The Conference Committee has met 6 times to find common ground. During the last meeting, the Senate offered to “split the difference”, this time proposing 2.625%, below the 3% it costs just to stay even.  The House refused. The proposed 1.25% increase is $80 per student, but only applies to the students still in the district. Nodaway Valley is among half of Iowa schools losing enrollment. So the 1.25% statewide translates to 1% total increase in the budget for Nodaway Valley.  Even that could be handled with cuts if all the students who left were, say in the 4^th grade, since we wouldn’t then need a 4^th grade teacher. That is of course not the case, and districts with declining enrollment must figure out how to continue 4^th grade and maintain other programs, with fewer and fewer funds.

Education funding is a significant part of the Iowa budget. If you listen to Representative Baudler and some of his colleagues, you get the idea that we are on the brink of collapse. But consider these highlights about Iowa’s Economy:

·        Iowa’s Economy ranks 9^th in the nation in reserve funds on hand (8^th in percent on hand from www.taxfoundation.org/maps )  

·        Ranks 12^th highest growth rate in gross domestic product nationally,

·        Ranks 9^th in growth of per capita personal income nationwide (2012 – 2013).  Although farm income contributed to a lower increase in 2014, we still rank 25^th.

·        Ranks 24^th in median household income (2011)

·        The Revenue Estimating Conference estimates 4.3% growth in state revenue for FY 2015  and 6.0% for FY 2016 ($408 million)

·        Ranks 38^th in State/Local Corporate Income Tax Collections per Capita (USA $139 vs. Iowa $63) http://taxfoundation.org/article/statelocal-corporate-income-tax-collections-capita-2006-2010

·        Ranks 29^th  in State-Local Tax Burden as a Percentage of State Income, FY 2011 taxfoundation.org/burdens

·        Ranks 27^th  in Combined State & Average Local Sales Tax Rates in 2014 (taxfoundation.org/maps)

·        Additionally, the Governor champions in his budget book, “in the last four years:

•        168,700 jobs have been created

•        Iowa’s unemployment rate has been slashed by nearly 30%

•        Over $9 billion in private capital investment has located in Iowa

•        Iowa passed the largest tax cut in state’s history (property tax reform)

•        Invested historically in our children’s future through transformational education reform.”  ($50 million annually in grants beginning in FY 2015 and $50 million annually to include early implementers in the formula beginning in FY 2016)

The details of the Governor’s budget are found in the Legislative Service Agency’s analysis, along with much more detail, here:  https://www.legis.iowa.gov/docs/publications/LAGRP/620691.pdf

The note above about $150 million being allocated for Iowa schools is accurate, although that’s over 3 years. The Teacher Leadership and Compensation (TLC) grants started this school year provided to schools serving 1/3 of Iowa students. Next year another 1/3 of the schools receive that funding, including Nodaway Valley. By the end of the 2016-17 school year, all schools in the state could be participating and getting the new funding. That new money MUST be directed toward the Governor’s TLC Program, however.  It cannot be used for regular operating expenses. So as operating expenses go up at the rate of 3% and NV gets 1%, cuts will have to be made.  And cuts have already been made. What would you like to see go next?

We’ve had a decade of underfunding in Iowa K-12 public schools. Prior to 1993, school funding increases were calculated by a formula that considered inflation and other economic factors. Now those increases are decided by the legislature, most recently late in the process with political debates dominating the conversation.  The gap between funding per pupil for Iowa and the nation has widened dramatically. Prior to the 2000s, student learning in Iowa ranked at the top of the pack in NAEP scores compared with other states. Since, despite modest gains for Iowa kids, other states have passed us by in both achievement and funding.

Think of this convergence of issues. Iowa is now over $1,600 below the national average in per pupil school spending in the nation.  We have an increasing economic divide in our state with more children in poverty, despite good employment and economic gains. In 2009 we had 34.1% of our kids receiving free and reduced lunches. By 2015 that number exceeds 41% according to the Iowa Department of Education.

Given the history of underfunding, the increasing needs of students, Iowa’s strong economy and ability to pay, 1.25% is not sufficient. Please let Mr. Baudler and Mr. Chapman know, as well as Governor Branstad, that education in this state matters. Iowa’s future well-being depends on a well-educated workforce. We invest in education today or we pay more tomorrow for social services, criminal and corrections costs, and other lost opportunity costs for our citizens.  Which future do you prefer for your children and grandchildren?

Respectfully submitted,

Willard and Susan Olesen

Greenfield