School finance: A troubled and complicated history

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(First of four articles)

Kansas legislators must soon secure equitable and adequate funding for local public schools. Central to this challenge is the 1992 Kansas School Finance Act, a remarkably good law that worked well until its repeal three years ago.

This series examines recent history of that law. – JM

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Three years ago Gov. Sam Brownback pronounced the (1992) Kansas School Finance Act “too difficult to understand” and demanded that legislators repeal it. A replacement act froze spending at reduced levels to be divvied in block grants among the state’s 286 school districts while legislators drafted a new law. Ignorance was brushed aside; the old law was “difficult” only for those who had never bothered to read it or review its history. It was easier for legislators to junk the law, please the governor, and buy time to write a new law replacing one they hadn’t read.

The new law remains unwritten yet, as schools stagger along on starvation diets. It’s quite a gamble to cancel statutes, cut a check and play out fictitious promise in a theater of false possibility – especially as courts frown on the pawning of school funds to coddle the egos of no-tax fanatics and highbrow ideologues. History tells why:

At the urging of the Kansas Supreme Court, legislators and the governor had created the School District Equalization

Act of 1973, the first major reform since school unification in 1963. It provided significant state aid to needy districts and a “formula” to determine district allocations. That formula turned chiefly on the value of property in a district. It worked, but with education law in Kansas, the urge to tinker begins even before the ink is dry on the original statute.

Although the law directed more aid to the neediest districts, guidelines to define such “needs” were unclear. Some students required special attention; poverty, mental and physical handicaps, and long commutes were serious, expensive challenges. Economic growth in some regions, decline in others added to factors affecting districts’ wealth. The gaps between poor and wealthy districts widened.

The tinkering began. School finance and its increasing costs moved nearly to the top of the legislative calendar.

By the late 1980s, the Court was again involved; disparities among schools in poor and wealthy districts had become too great; property values and personal incomes – chief components in district wealth – were so divergent that in this context they were unconstitutional.

Federal tax cuts (1986) had exposed more Kansas income to state taxation. Property classification and reappraisal (1989) skewed components of the traditional formula even further. Statewide, taxable income was suddenly an average 56 percent of school district wealth (not 25 percent) and property values, 44 percent (not 75).

Without revision, the finance formula would penalize scores of communities placed almost overnight among the ranks of high-income school districts; they faced dramatic losses in state aid and soaring property tax bills.

By late 1989, angry protests against those looming tax increases swept over the state. Gov. Mike Hayden called a special two-day session of the Legislature to deal with the issue. It adjourned in frustration.

In 1990 and 1991, the Legislature and Gov. Joan Finney failed to agree on funding enough to repair the education finance formula.

In the summer of 1991, dozens of school districts sued the state, claiming the law no longer provided equitable financing or education opportunities in Kansas school districts. Wide disparities in regional wealth could no longer be bridged with infusions of state aid, then an amount approaching $900 million and rising. (It’s now $3.3 billion.)

As a result, the districts claimed, students, taxpayers, and school districts were unconstitutionally disadvantaged.

The issue went to Shawnee County District Judge Terry Bullock, an eloquent and imposing legal scholar with a reputation for reason and sharpness. The judge noted that huge disparities in regional wealth, combined with funding law at that time, violated a constitutional guarantee that the quality of education in a school district should not depend on the wealth of that district.

Because education is a state responsibility, Bullock said, regional wealth must be apportioned, or shared, more equitably.

He invited the Legislature and Gov. Finney to modify the law, and suspended the lawsuits pending deliberations in the coming 1992 legislative session.

By mid-May 1992, after months of grinding debate, the Legislature and governor approved historic reforms. Key components of the legislation included a statewide, uniform property tax for schools and a central pool for distribution of revenues; it set local spending limits with some variation for exceptional costs (local option budgets).

The law also ordered that funding be tied to the number of students to be educated, not district wealth; it added sales and income tax revenues to the funding pool; at the same time, it enacted new standards by which schools were to be measured for student achievement.

(Next: A good law under siege)

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