School Finance

Indiana superintendents praise funding hike but worry about poor schools

PHOTO: Hayleigh Colombo
Indiana House Speaker Brian Bosma, House Ways and Means Committee Chairman Tim Brown, Indianapolis Public Schools Superintendent Lewis Ferebee and Northwest Allen County Schools Superintendent Chris Himsel participated in a January forum on school funding organized by Chalkbeat.

Indiana superintendents have a message for state budget-makers: All schools need more funding, but it can’t come at the expense of the state’s poorest districts.

The Indiana Senate’s school funding subcommittee, chaired by Sen. Ryan Mishler, R-Bremen, today heard testimony on proposed changes to school funding, including comments from 11 superintendents who testified on the Indiana House’s proposed budget. The budget, House Bill 1001, would give K-12 schools statewide a 4.7 percent increase through 2017. Overall, state dollars for public schools will increase by $469 million to a record high of $6.9 billion.

That record increase would be accompanied by major changes, however. The plan includes adding more money to the basic tuition amount for each student, which benefits all schools in the state. But extra money earmarked to help poor students who often start school academically behind their peers, has been changed.

Going forward, just students from families that are poor enough to qualify for free lunch will be counted in for extra state aid. In the past, the poverty aid has also been calculated to provide extra money for students who are slightly less poor but still qualify for special assistance, such as free textbooks or reduced-price lunch. For districts like Indianapolis Public Schools, where a large majority of students come from families who are poor enough to qualify for free and reduced-price lunch, this could mean huge losses in state aid.

“We believe these reductions are too volatile, the pace of change is too fast, for any corporation to either gain or lose a significant amount of funding over a short period of time,” Indianapolis Public Schools Superintendent Lewis Ferebee said.

To qualify for the lunch program this year, children from a family of four must have annual income of less than $43,500. Last year, about 78 percent of IPS students came from families that were poor enough to qualify for free lunch, but that number is expected to drop to about 71 percent this year. Ferebee said that shouldn’t be interpreted to mean that IPS has fewer students in poverty — rather, families are not as readily applying for the free lunch program. This year IPS got a federal grant money that provides free lunch to all students regardless of income, reducing urgency for families to fill out paperwork. Their kids will get free lunch whether they officially enroll or not.

Kathy Friend, the chief financial officer of Fort Wayne schools who spoke on behalf of the Indiana Urban Schools Association, said all schools will see some reduction in dollars to support poor children, but that the state’s poorest districts will be hit the hardest. As a result, more basic state aid dollars intended to support all children will need to be channeled toward poor kids to make up for the lost poverty aid in districts with more poor children.

Much of this year’s legislative debate around school funding has centered on the disparity between the state’s lowest-funded districts, often those with higher state test scores, and the highest-funded districts, which tend to be high poverty districts that also tend to have more students with special needs and those learning English as a second language.

Chris Himsel, superintendent in Northwest Allen County Schools in suburban Fort Wayne and an advocate for increased aid for suburban districts, said the trade-off between increased basic state aid for all students while also giving less extra money for poor students is unacceptable. His district comes out slightly ahead based on the proposed changes to the funding formula, but that still isn’t enough, he said. Northwest Allen shouldn’t gain if it means others must lose, he said.

“All of our kids throughout our state need more funding,” Himsel said. “To do the things that we are being asked to do with what we currently receive is not enough … I am interested in helping our kids. I am not interested in destroying other kids to do it.”

Superintendents from districts as diverse as East Chicago, Batesville, Greene County, Elkhart and Zionsville said they simply can’t make ends meet, even with the proposed increase in basic state aid. The state needs to do more, they said, whether that means even more basic state aid for all schools, reducing poverty aid more slowly over time or sticking with the current method for calculating poverty aid.

East Chicago superintendent Youssef Yomtoob implored lawmakers to at least slow the reduction in poverty aid so it won’t hit as hard right away.

“Grandfather us in,” Yomtoob said. “I don’t want more money, but do not take $4 million. That’s over 20 percent of my budget. I can’t live like that.”

Superintendents from districts where enrollment is growing, such as Hamilton Southeastern and Carmel, were generally more supportive of the proposed budget, which tends to be favorable to districts taking in more students. Allen Bourff, superintendent at Hamilton Southeastern, said he understands there are many concerns for urban schools, but the problems his district is facing are valid, too.

“I applaud the work of the House members to craft a bill that would address some of the issues that we have faced in Hamilton Southeastern over the years,” Bourff said.

The budget will again go before the Senate Appropriations Committee, chaired by Sen. Luke Kenley, R-Noblesville, on April 9.

school finance

Memphis charters could soon qualify for free rent in district-owned buildings

PHOTO: Courtesy of Vision Prep
Building maintenance is a challenge for charter schools in Memphis that pay rent to Shelby County Schools, including Vision Preparatory Charter School pictured here in spring 2017.

In a sea change, some Memphis charters could soon use district buildings without paying rent, though which would qualify is yet to be determined.

The proposal is the latest from the committee of charter and district leaders tasked with working through thorny issues between the sectors, which often have a tense relationship because they are competing for students. Shelby County Schools board members will discuss the recommendation at its meeting tomorrow evening and vote next Tuesday.

The group is also recommending that Shelby County Schools sell its unused buildings to charter schools if the buildings are in good enough condition. Of the 10 vacant district-owned buildings, four would qualify.

The proposed policy would go a long way in clarifying charter school access to public facilities and speeding up Shelby County Schools’ shedding of excess buildings, an issue that has become more acutely felt as enrollment declines.


2016 map: Half of Memphis schools closed since 2012 stand empty


Charter schools authorized by Shelby County Schools make up about a fourth of the district, the most in the state, but only five of the 51 schools use district space. The rest rent private space or, in a few cases, own their buildings.

One barrier to using district space: Until recently, district officials required charter schools to pay rent because not all schools agreed to pay an “authorizer fee” meant to defray the costs the district incurs in overseeing charters. But now that a new state law requires charter schools to pay 3 percent of their state and local dollars to their authorizers starting next year, the district is under less pressure to recoup costs.

The prospect of a change is exciting to Tom Benton, the founder of Vision Prep, one of the five schools currently operating in district space. The school has been spending $79,000 a year to rent its southwest Memphis building, while also footing the bill for maintenance, utilities, some insurance, and any capital improvements it wants to make.

Benton said there are better uses for taxpayer dollars.

“That money could have bought us a new roof,” Benton said from his office, which is one of several parts of the school that have flooded during recent rainfalls. He recently promoted a part-time building engineer to full-time to deal with the issue.

“This is a public school with public school children,” he said. “We feel like those dollars should follow the child.”

It’s unclear whether Vision Prep will get to operate rent-free. The proposal does not guarantee free rent, only make it available, and it does not specify which charter schools will qualify.

Brad Leon, chief of strategy and performance management, said the district could weigh where the school wants to locate, performance on state tests, and whether the school offers specific programs, such as STEM or Montessori. Those specifications would ultimately be up to the school board, Leon said.


With a charter comes the search for school space. Here’s how one Memphis operator is doing it.


How school districts handle space requests by charter schools says a lot about their relationship with the publicly funded, privately managed schools. In New York City, former Mayor Michael Bloomberg, a charter schools advocate, handed out excess space at no cost — a policy that his successor, the current mayor Bill de Blasio, campaigned on altering. (Legislation has stopped him from making major changes.)

Other urban districts with a large number of charters, including Chicago and Indianapolis, negotiate nominal rents — often just $1 — for charter schools. Those cities have robust charter sectors and, importantly, district leaders who accept that charter schools are going to serve a large number of local students.

Shelby County Schools officials have a more complicated relationship with the city’s growing charter sector. They are actively vying to prevent more students from leaving the district for charter schools. And they resent being required by law to allow the 29 Memphis schools in the state-run Achievement School District, which takes over low-performing schools and mostly turns them into charters, to operate in their buildings rent-free.

Tennessee has helped charter schools with space in other ways. It requires districts to post a list of vacant or underused properties that could be used by charter schools, although it lets districts ultimately decide what to do with the buildings.

The state has shown willingness to help charter schools with facility expenses. The same state law that ushered in the authorizer fee also launched a $6 million grant program to reimburse charter schools for capital projects, rent, or purchasing buildings — if the school has a high academic growth score. Benton said Vision Prep has applied to the grant program to offset the school’s costs.

Alliance

Memphis just gained an important ally in its legal battle with Tennessee over school funding

PHOTO: MNPS
The board for Metropolitan Nashville Public Schools voted Tuesday to become a co-plaintiff in Shelby County Schools' funding lawsuit against the state of Tennessee.

For more than two years, a funding lawsuit by Memphis school leaders has been winding through the state’s legal system.

Now, as the litigation inches closer to a court date next year, Shelby County Schools has gained a powerful ally in its battle with Tennessee over the adequacy of funding for its schools and students.

The board for Metropolitan Nashville Public Schools voted unanimously Tuesday to become a co-plaintiff in the case.

The decision ends almost three years of talk from Nashville about going to court.

In 2015 at the urging of then-director Jesse Register, the district’s board opted for conversation over litigation with Gov. Bill Haslam’s administration about how to improve education funding in Tennessee.

But Register moved on, and the board’s dissatisfaction grew as the percentage of state funding for the district’s budget shrank. Adding to their frustration, Haslam backed off last year from an enhanced funding formula approved in 2007 during the administration of his predecessor, Phil Bredesen.

“We’ve just come to grips with the harsh reality that we are a chronically underfunded school system,” said Will Pinkston, a board member who has urged legal action.

Nashville’s decision is welcome news for Memphis. A statement Wednesday from the state’s largest district called the lawsuit “the most important civil rights litigation in Tennessee in the last 30 years.”

“When you have the two largest school districts in Tennessee on the same side, I think it’s very powerful,” added former board chairman Chris Caldwell, who has championed the lawsuit in behalf of Shelby County Schools.

Both boards are working with Tennessee-based Baker Donelson, one of the South’s largest and oldest law firms. It has offices in both cities.

“We believe that our original case had a strong message about the inadequacy of education funding in Tennessee,” said Lori Patterson, lead attorney in the case from Memphis. “We believe that having the second largest district in the state join the suit and make the same claims only makes the message stronger.”

PHOTO: TN.Gov
Gov. Bill Haslam

Haslam’s administration declined to comment Wednesday about the new development, but has stood by Tennessee’s funding model. In a 2016 response to the Shelby County lawsuit, the state said its formula known as the Basic Education Plan, or BEP, provides adequate funding under state law.

But Shelby County, in its 2015 suit, argues that not only does the state not adequately fund K-12 schools, it doesn’t fully fund its own formula. And the formula, it charges, “fails to take into account the actual costs of funding an education,” especially for the many poor students in Memphis. To provide an adequate education, the lawsuit says the district needs more resources to pay for everything from math and reading tutors to guidance counselors and social workers.

States often get sued over funding for schools — and frequently lose those cases. In Tennessee, state courts heard three such cases from the late 1980s to the early 2000s, siding with local districts every time. Those suits keyed in on built-in inequities in the state’s funding formula that cause some districts to get more money than others.

This time, the argument is about adequacy. What is the true cost of educating today’s students, especially in the shift to more rigorous academic standards?

Tennessee is also the defendant in a separate funding lawsuit filed in 2015 by seven southeast Tennessee school districts including Hamilton County Schools in Chattanooga.

Pinkston said Nashville opted to join the Memphis suit because its arguments are most applicable to the state’s second largest district. “Our student populations are very similar in terms of high socioeconomic needs,” he said.