Education Briefings for Candidates for Office

1

• Education Briefings for Candidates for Office
• In 2008
• School Finance

www.ncforum.org
2

• School Finance Overview
• Impact of the Lottery
• Budget Overview
• School Finance Litigation

3
School Finance Overview
4
(No Transcript)
5
2006-07 Sources of School Funding
Source DPI, Financial Business Services,
Highlights of the NC Public School Budget,
February 2008
6
Who Pays For What?

• 2007-08 Federal Funds Provide (2.84 B)
• Title I all programs (328.6 m)
• Child Nutrition (325.0 m)
• Children w/ Special Needs (297.0 m)
• Teacher Quality (62.4 m)
• Vocational Education (21.8 m)
• Technology Grants (5.8 m)
• After School Programs (20.9 m)
• Safe Drug Free Schools (5.8 m)

7
2007-08 Local Funds Provide (1.16 B)

• Additional teachers, instructional support
  teacher assistants (11,432 positions)
• Central Office Administrators (33.6 of total)
• Salary Supplements (4 _at_ 5,000, Average1,993,
  5 _at_ 0)
• School Construction, Maintenance Debt Service
• Utilities, Housekeeping, Technology, Garage
  Costs

8
Who Pays For What?

• 2007-08 State Funds Provide (7.37 B)
• Instructional Personnel (4.1 B)
• At-Risk Student Services (220.3 m)
• Children w/ Special Needs (663.3 m)
• Transportation (360.6 m)
• Low-Wealth supplemental funds (195.4 m)
• ABCs Bonus (70 m)
• Limited English Proficient (61.2 m)

9
Just the Facts. . .

• Largest Expense in the State Budget (37.3)
• Enormous Business (7.91 B)
• Largest Employers in the State
• Charlotte Mecklenburg Schools is among top 10
  employers
• Half of all districts have 1,000 employees
• Transportation (13,696 buses?178,297,253 miles)
• Counseling (4,380 counselors psychologists)
• Food Provider (186,564,780 breakfasts lunches)
• Maintenance staff (26,748 service workers,
  drivers other laborers)

10
NC History and how we got here

• Article IX Education
• Sec. 2. Uniform system of schools.
• (1) General and uniform system term. The General
  Assembly shall provide by taxation and otherwise
  for a general and uniform system of free public
  schools, which shall be maintained at least nine
  months in every year, and wherein equal
  opportunities shall be provided for all students.

11
School Funding Responsibility School Budget and
Fiscal Control Act (1975)
To insure a quality education for every child in
North Carolina, and to assure that the necessary
resources are provided, it is the policy of the
State of North Carolina to provide from State
revenue sources the instructional expenses for
current operations of the public school system as
defined in the standard course of study. It is
the policy of the State of North Carolina that
the facilities requirements for a public
education system will be met by county
governments.
12
School Machinery Act School Budget and Fiscal
Control Act (Responsibilities Are Blurred)

Statecurrent expense programs Counties Paid
for 6,621 teachers (7) 3,052 teacher
assistants (10.6) 2,276 instructional
support (17.9) 437 administrators
(25.8) (16.2 of all personnel) Countiescapita
l (building maintenance) State Has Paid 2
Billion for capital outlay since 1995 (25 of the
total)
13
(No Transcript)
14
(No Transcript)
15
(No Transcript)
16
(No Transcript)
17
(No Transcript)
18
(No Transcript)
19
(No Transcript)
20
(No Transcript)
21
Budget Overview
22
Source Public School Forum based upon
information from the Governor's Office the
General Assembly
23
Items of Concern
With only 150 million in surplus for 2008-09,
money available for expansions of supplemental
funding programs are limited.
2008-09 Proposal State Board Governor House Senate
Low Wealth Expansion NO NO 2.9 m 2.9 m
DSSF Expansion 86.2 m NO 6.0 m 5.0 m
TOTAL 86.2 m 0 8.9 m 7.9 m
24
2008 Short Session Key Issues

• Teacher salary debate
• Whether / how to bring to national average?
• How to balance against increases for other state
  employees?
• Guaranteeing ABC bonuses to teachers
• Funding enrollment growth also for UNC and
  Community Colleges
• Expanding dropout prevention grants (15M)
• Raising DSSF, AIG, special education allotments
• LEA concerns with child nutrition, fuel costs
• Modest expansions for More at Four, Learn and
  Earn Online, and other education programs
• 7 increase to national average for teachers
  116M

25
(No Transcript)
26
The General Assembly gave additional
flexibility to raise prize amounts over 50 of
the total IF that will increase the absolute
amount available for education transfers.
Note Reserve fund (5 of original total) is
fully funded and requires no additional
contributions.
27
Lottery Revenue Realities
Original estimates of 1.2 B in revenues
Projected Actual (2006-07) Off by
Scholarships 40.4 m 32.6 m -7.8 m
Class Size/ More at Four 201.9 m 162.7 m -39.2 m
Construction 161.5 m 130.2 m -31.3 m
TOTAL 403.8 m 325.5 m -78.3 m

• But even if projections had been right
• 82 years to finance the 9.7 B construction
  backlog (based on 2007-08 projected funding
  levels)
• 49 districts would still have gotten less than
  500,000

28
North Carolina Education Lottery
1996 School Bond 2005 Lottery Act
25 high growth 35 ability to pay 40 ADM 35 ability to pay 65 ADM
A Comparison of the Models shows 87 LEAS
received LESS money under the Lottery Act model
29
Counties Ability to Pay Qualifies Them for
Approximately 49 M in Extra Lottery Revenue (35
of Available Construction Funds)
57 shaded counties qualify for the extra revenue
based upon an ability to pay component SOURCE
NCGA, Fiscal Research Division
30
School Finance Litigation
31
School Finance Litigation
RedLow Wealth Plaintiffs BlueUrban
Plaintiff-Intervenors
32
Changing Needs of Students Adequate Resources
Every classroom be staffed with a competent,
certified, well-trained teacher Every school be
led by a well-trained competent Principal Every
school be provided, in the most cost effective
manner, the resources necessary -Leandro
mandates
33
Who's Accountable?
34
School Finance Case ISNT Over

State Responsibility The State must step in
with an iron hand and get the mess straight. If
it takes removing an ineffective Superintendent,
Principal, teacher, or group of teachers and
putting effective, competent ones in their place,
so be itThe State of North Carolina cannot shirk
or delegate its ultimate responsibility. Judge
Howard E. Manning, Jr.4/4/02 memorandum
35

• DSSF Resources Then
• Started with 16 pilot districts
• Funded at 22.5 million
• New model approved by plaintiffs, defendants
  judge
• And now
• Covers all 115 LEAs
• Funded at 191.6 million for 2007-08 school
• year

36
Kendall Jordankjordan_at_ncforum.org919-781-6833
x 102www.ncforum.org