By WNPA OLYMPIA BUREAU and THE DISPATCH State lawmakers have yet to come to grips in the 2015 legislative session with education financing plans to meet the state Supreme Court's order to fully fund basic education in public schools as defined in the state constitution. Legislators and Governor Jay Inslee agree that education is the dominant issue before them this session. They don't agree, however, on a method to resolve the dilemma of: finding the dollars to meet that mandate. Added to the education funding challenge is Initiative 1351. Passed by voters statewide last November, the measure requires the state to lower class sizes in grades K-12 and adds additional teachers and support staff in order to do so. The state's Office of Financial Management estimates implementing I-1351 could cost the state $4.7 billion through fiscal year 2019 and an additional $1.9 billion each succeeding year. The initiative didn't include a funding source and has a four-year phase-in, with 50 percent implementation in the 2015-17 biennium and 100 percent implementation in 2018-19. School districts would have an additional fiscal challenge to meet requirements of I-1351. Statewide, they would need to fund $1.3 billion with local levy dollars through the 2018-19 school year to implement th initiative due to the difference between what the state allocates for teachers' pay and what local school districts actually pay their teachers. Bethel School District superintendent Tom Siegel said changes to the staff allocations without increasing the funded average salaries "will significantly adversely impact" the district. The state office of superintendent of public instruction estimates the Bethel district would receive 257 additional 257 teachers. "Besides the difficulty in hiring that many additional staff, particularly when every other district is trying to hire, we have no space to house them, nor do we have any bonding capacity to build new schools," Siegel said. As an example of the problem, Siegel said the governor proposes reducing the number of students in classes to 17 in kindergarten through third grade in fiscal year 2016-17 as a start to complying with I-1351. The state funding would partially fund 81 teachers, but the Bethel district would have to hire 94 teachers to accommodate the lower class sizes. That would require an additional $3 million from local levies for the unfunded salaries and benefits, and the district would also need the equivalent of four additional elementary schools to house the increased number of classrooms, according to Siegel. "This is just a small part of the proposed I-1351 changes," Siegel said. Why is theducation funding issue haunting state legislators? In the 2012 McCleary case, the state Supreme Court ruled that the state was in violation of the constitution because of its reliance on local levies and federal funds to fund basic education, rather than direct state-financing programs. The court reaffirmed that it was the Legislature's responsibility to define basic education in terms of dollar amounts and programs, but concluded legislators hadn't done that job. In the 2009-11 biennium, legislation expanded the definition of basic education and restructured K-12 funding formulas in response to the McCleary court case that was filed in 2007. Inslee's proposed budget for the 2015-17 biennium includes $3.6 billion for education, of which $1.3 billion is dedicated to lowering class sizes in grades K-3, an overlap between the initiative and the state's McCleary obligation, which mandates class-size reductions in the lower grades. And though Inslee's proposal is championed as the largest increase in basic-education funding in nearly a quarter century, it still falls short of the $4.7 billion needed to fund I-1351. "They're not funding 1351," said Superintendent of Public Instruction Randy Dorn, referring to Inslee's budget proposal. "The governor made no attempt to fix it or give us a plan on how he's going to get to fully fund education." Dorn says some kind of levy transfer in which school-district levies are reduced and the same amount is captured by the state property tax might be part of the solution. "I believe in the end you have to look at some kind of levy exchange to pay for it," Dorn said. "I don't think you will have enough money to pay for all of I-1351, but you can do all-day kindergarten, K-3 class-size reduction, and then you have to do something about the 25 to 1 ratio in middle school and high schools." Rep. Ross Hunter, a Democrat from Medina who is chairman of the House Appropriations Committee, in the past has also proposed a revenue-neutral levy swap, where the state takes a greater share of local school tax levies, as a means to fund the Supreme Court's mandate. Taxpayers would pay the same amount in taxes but to the state instead of the local districts. But now he says a levy swap, where you change out local money for state money, is not effective because it doesn't add any new revenue. "It makes people crazy because it's just moving a lot of money around and everyone is nervous about doing that, even though the overall tax burden to the state stays about the same," Hunter said. A major area of concern raised by I-1351 hinges on the state's funding of teacher salaries. The initiative falls short in adequately funding teachers' salaries because the state doesn't provide adequate funding for school districts, Hunter said. "The teachers are actually getting paid enough because the local school districts make it up," Hunter said. "They raise money with local property tax (special levies) and pay the extra cost of hiring teachers." Siegel said increasing state funding for district staff "without correcting the underfunding of the underlying salaries will increase pressure on the local levy funds or prohibit" the Bethel district "from hiring the additional staff." In the McCleary decision the court ruled that the state did not provide adequate teacher salaries and needed to bring salaries to the market rate that districts are paying to actually hire a teacher, Hunter added. Mary Howes, executive director of Class Size Counts, a statewide coalition of families, educators, students and community leaders, said all the teachers in Washington have the same base salaries because they're all on the state salary schedule. I-1351 doesn't have a funding source but would allocate state money to school districts to hire additional teachers to accommodate the reduction in class sizes. But some districts give teachers additional compensation on top of what the state is allocating, and because this additional pay is locally bargained, the amount varies from district to district, Howes said. "The state would provide the salaries for additional teachers" but wouldn't cover locally bargained additional compensation, Howes said. Ben Rarick, executive director at the State Board of Education, said I-1351 would impact all 295 school districts differently depending on their use of local levy dollars. With the funding school districts could receive for I-1351, some districts might have an easier time meeting the required class sizes because those districts have already invested local levy money in hiring more teachers. On the other hand, districts with limited levy capacities may struggle to hire more teachers or find adequate classrooms for them, Rarick said. "It creates a teacher supply-and-demand situation in our state, and it's not quite clear how it will shape out for each individual factor," Rarick said. In regards to levy swaps, Rarick said the state board supports that maneuver as long as the levy swap adds new money to the system. "Our goal is to fundamentally strengthen and expand programs and services for kids," he said. "We don't want to play a game of musical chairs." Rarick said the state salary-allocation model, which sets salaries and pay raises, has become more irrelevant as local funding has become a larger percentage of a teacher's salary. "I think it's necessary to place some new limits on how local levy money can be spent," Rarick said. "It's not clear whether or not we will be able to devise a cookie-cutter approach that applies to all 295 districts, but I am convinced, one way or another, that we are going to have to talk about local levy reform." Alan Burke, executive director of Washington State School Directors Association, also expressed concern with the funding and facilities portion of I-1351 because many school districts do not have the capability to add additional classrooms. -รก Alice Day, a reporter in the WNPA Olympia News Bureau, contributed to this report.
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