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IASB Legislative Conference

Issues and Priorities for the 2008

Legislative Session

Contacts: Margaret Buckton – IASB Assoc. Exec. Director, Public Policy, mbuckton@ia-sb.org and Mary Gannon – IASB Attorney,

mgannon@ia-sb.org (800)795-4272

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Check off from 2007 (thanks to legislators!)

Reinstated reorganization and sharing incentives

Began an investment in quality early childhood preschool experiences. Must continue the phase-in until all districts have access to funds and make it part of the foundation formula for stability.

Education funding in general.

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Budget Issues

REC memo Built-in increases (Allowable Growth set at 4

percent for 2008-09, Pre-school and Teacher Quality appropriations)

Sustaining Funding for:– Class Size & Phase II (roll into formula):

Remember technology funding example – categorical funds can be easily cut.)

– Professional Development

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Policy Priorities approved by IASB Delegates, Nov. 14, 2007:

Replace SILO with Penny Foundation Formula Tax Equity Professional Development State Funding State Content Standards/Assessment Allowable Growth (6 percent) Foundation Formula Addresses

Enrollment Changes

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#1 Infrastructure Equity

Supports replacing the school infrastructure local option tax with a statewide penny sales tax distributed on a per pupil basis, recalculated annually to adjust the statewide average revenues per student.

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School Infrastructure Local Option (SILO)

$10 million state appropriation funded up to an estimated $526 per pupil in 2007-08.

Why necessary? Infrastructure backlog, growth and property tax equity.

Lower revenues, increased construction costs, and unmet needs all prove 10 years is not enough.

99 counties have it. 24 have extended. No extension votes have failed.

Unequal ability to bond is unfair to rural counties receiving supplemental state payments. The $575 ceiling (well below the average) is unfair to urban counties.

Opportunity for penny on cars – helps road use tax fund. It’s about equity, stability, facilities designed for learning.

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$281

$526*

*$526 SILO revenue includes state supplemental payments. Only local revenue ($281 per pupil) may be bonded against.

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School Infrastructure Local Option (SILO)

Politics of legislative leadership: need bi-partisan support to pass it. Certain elements must be included:

– Protected by 2/3rd majority to change existing purposes

– Fix definition of rolling average– Local process for voter input (reverse referendum)– Revenue neutral proposal: expanded tax base

goes for property tax and residential sales tax relief.

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Tax Base Differences/Opportunities

Consumer and Business Use Tax – LSA estimates a net $28 million with the statewide penny – IASB proposal dedicates this to property tax equity.

Combined with solidifying the state appropriation, results in $53 million for proeprty tax equity.

TIME 21: 6th penny applied to car sales goes into the road use tax fund.

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Closes Use Tax Loophole

Use tax is tax paid by businesses and consumers on items purchased out of state. Mirrors the state sales tax.

Helps some Iowa businesses to be competitive. Must collect it to keep our agreement with the

multi-state consortium to tax internet sales. How the use tax is spent is a political issue. For

strong bi-partisan support, any proposal must be revenue neutral to avoid “tax increase” label.

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Question: Won’t a future legislature scoop this pool? Not likely. . . .

2/3rds vote is required to change purpose. Strong coalition will oppose scoopage. Some school districts will bond. Bond

holders will squawk and sue the state. Legislators have scooped funds with ending

balances – the state penny pool won’t have one – money is paid out monthly.

Look at current SILO pool – ending balance of $142 million by 2014. Scoopage to grow government is more likely with current law.

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However. . .

SILO pool under current law accumulates an ending balance ($142 million by 2014) due to $575 per pupil cap.

Scooping SILO pool is very likely under current law.

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Question: Doesn’t the state penny destroy local control? NO, because. .

The revenue purpose statement is the local control connection between the district and taxpayers.

Under current law, many districts have no local control and are dependent on their neighbors.

If voters challenge and defeat a revenue purpose statement, automatic property tax relief.

Dissatisfaction theory – voters will defeat incumbent school board members who don’t make good decisions.

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Supports building on student and taxpayer equity investments begun during the 2006 Legislative Session, ensuring they are fully funded as part of the foundation formula for stability, by buying down the highest additional property tax levies in the state to the state average and holding harmless districts with additional property tax levies below the state average.

#2 Foundation Formula Property #2 Foundation Formula Property Tax and Student EquityTax and Student Equity

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Operation of Foundation Formula

Property Poor District Property Rich District

Additional Levy Additional Levy

State Aid State Aid

$5.40 Uniform Levy

$5.40 Uniform Levy

87.5% of Total

Cost Per

Pupil$4,666

Total Cost Per

Pupil

$5,333

Total Cost Per

Pupil

$5,333

87.5% of Total

Cost Per

Pupil$4,666

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Why change property taxes via foundation formula?

Schools levy half of property taxes.

Additional levy explains tax rate differences:

–Lowest additional levy: $1.66 per $1,000

–Highest additional levy: $9.11 per $1,000

–Rate is inversely proportional to property value per pupil (low property value per pupil = higher additional levy rate and vice versa).

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Progress last two sessions: Appropriated$ 6 million in FY 2006 (30 districts),$12 million in FY 2007 (50 districts), $18 million in FY 2008 (70 districts), and $24 million in FY 2009 (77 districts).

Short of the $40 million required to bring all districts down to the state average additional levy rate.

Not a function of the formula – a categorical appropriation buy down.

#2 Foundation Formula Equity#2 Foundation Formula Equity

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Why do board members care about property taxes?

Other proposed reforms restrict the tax base. 2/3rds of Iowans and most businesses are in property

poor districts. Tax rate impacts student equity – districts with highest

rates are least likely to fully fund other levies. Property tax disparities inhibit reorganization discussions. Citizen perception that districts with higher rates are

financially mismanaged. Relationship to economic development.

#2 Foundation Formula Equity#2 Foundation Formula Equity

20Green next to red or orange shows big disparity, barrier to reorganization, and perceptions of mismanagement.

FY 2007

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SILO Repeal/Penny Replacement creates revenue to address this issue!

Long term commitment to buy down highest levies in the state. The proposal solidifies the previous categorical fund appropriation and adds the expanded use tax revenue to pay for more.

Grows to $53 million and benefits 144 districts by FY 2012

Only a start, but it’s a good one. No harm/no fear to districts with higher than average

property value per pupil. Minimizes a barrier to consolidation.

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#3 Professional Development

Supports full state funding to implement the Iowa Professional Development Model. The school district is the appropriate authority to determine the amount and content of, and require participation in professional development to improve instruction focused on the district’s student learning goals. IASB supports collective bargaining discussions concerning how teachers are paid for professional development time.

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#3 Professional Development Targeted to improved student learning Professional development position paper Iowa Professional Development Model

– Linked to district learning goals– Research-based best practice– Ongoing study includes theory,

demonstration, practice, collective study of student learning and focus on instructional change.

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Teacher Training is the Solution Mike Schmoker, The Real Causes of Higher

Achievement, SED Letter, May 2002: “There is nothing esoteric about what is needed for schools to make dramatic progress — even in the near term. We need only to fix our gaze on effective, targeted teaching — and on mechanisms for promoting, replicating, refining, and routinely honoring such teaching. Providing our teachers with even an hour a month to create, refine, and assess the impact of new lessons and strategies could start a revolution.”

http://www.sedl.org/pubs/sedletter/v14n02/1.html

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Better Teaching Beats the Odds

A 1999 study by the Education Trust found that hundreds of poor and minority schools have beaten the odds and succeeded with exceptional numbers of students, giving them life chances once reserved only for those who grew up in the "right" neighborhoods. How? By (1) teaching to assessed standards and by (2) continuously learning and refining better ways to teach to these standards.

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Politics and Stakeholders Teachers’ Association: increased salary

and funding for professional development within the existing contract period (no increase in days.)

Some educators have said PD is a waste of time and competes with student time.

School districts must show responsible use of professional development time and proof of increased student achievement.

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Teacher Quality Clean-up

TQ committee process – must gather data about how it’s working. Although likely variable across districts, let us (and your legislators) know how it’s going.

TQ committee exists because some districts weren’t inclusive or didn’t have quality PD.

Watch for DE tracking of the days of PD. The 2007 report showed an increase in the number of days meeting the definition of quality PD. Will that continue?

School boards, the accountable entity, need the authority to manage – board approval of the process is required.

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#4 State Content Standards and Assessments

Supports development of consistent, rigorous content standards, by the Department of Education, that set high expectations for student learning, while providing flexibility and supports to local school districts in delivering on those high expectations.

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#4 State Content Standards and Assessments

Position paper Random sample of Iowa district standards showed

wide variance Emphasis on ITBS/ITEDs for accountability may

pressure the system away from serving all kids Data on High Expectations is on the web site,

Convention Handouts: http://www.ia-sb.org/uploadedFiles/IASB/Convention_Web/Convention_2007_Handouts/Session%209%20High%20Expectations%20for%20Iowa%20Education.ppt

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Better Teaching Beats the Odds

A 1999 study by the Education Trust found that hundreds of poor and minority schools have beaten the odds and succeeded with exceptional numbers of students, giving them life chances once reserved only for those who grew up in the "right" neighborhoods. How? By (1) teaching to assessed standards and by (2) continuously learning and refining better ways to teach to these standards.

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Student Achievement Data Sources

ITBS/ITEDs – from the DE’s Annual Iowa Condition of Education Report http://www.iowa.gov/educate/component/option,com_docman/task,cat_view/gid,646/Itemid,774/

NAEP – Annual NAEP Report, Sept. 2007 http://nces.ed.gov/nationsreportcard/pdf/main2007/2007496.pdf

ACT http://www.act.org/news/data/07/states-text.html

Education Week’s Jan. 10, 2008 Quality Counts Report http://www.edweek.org/ew/toc/2008/01/10/index.html

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State of Iowa 4th Grade ITBS Reading Comprehension Trend(Data from the Iowa Department of Education Condition of Education 2006 Report)

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State of Iowa 8th Grade ITBS Reading Comprehension Trend(Data from the Iowa Department of Education Condition of Education 2006 Report)

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State of Iowa 11th Grade ITED Reading Comprehension Trend(Data from the Iowa Department of Education Condition of Education 2006 Report)

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4th Grade NAEP Reading Trends, Iowa vs. Nat'l Average

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4th Grade NAEP Math Trends, Iowa vs. Nat'l Average

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Scatter Plot: 1997 ACT Scores and Percent of Students Tested (All States)

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Scatter Plot: 2007 ACT Scores and Percent of Students Tested(All States)

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Model Core Curriculum

In 2006 was HS English, Math and Science In 2007, expanded to K-8, added social studies and

21st Century skills, like financial literacy and technology

Great content, but without benchmarks and a good assessment, and without an investment in training teachers, it’s unlikely to have a significant impact on student learning.

Policy question - Is voluntary model core enough to overcome pressure of NCLB on the system?

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What happened to IASB as the voice for local control?

Student achievement has improved in states with higher expectations and good assessment.

Local control about how to teach the content remains.

Setting standards and assessment at the state level frees up curriculum and instruction experts to work locally on improved instruction in the classroom.

Now that good standard and assessment systems have been developed, replication won’t be nearly as expensive as if we had to create the whole process.

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#13 Allowable Growth

Supports setting allowable growth at a rate that encourages continuous school improvement and reflects actual cost increases experienced by school districts.

The allowable growth rate should be set no lower than 6 percent. Equivalent state categorical funding is not a substitute for adequate allowable growth.

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Allowable Growth History

Historical Allowable Growth Rate Increases

2009: 4.00%

0%2%4%6%8%

10%12%14%16%

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Are Iowa schools still struggling with budgets?

Economic slowdown in early 2000’s resulted in lower allowable growth rates.

Declining enrollment for 2/3rds of districts – pupil based formula.

Recovery has resulted in categorical fund appropriations (with strings attached.)

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Legislature has already spent 4 percent for school districts

Mandated positions: librarians, counselors and nurses

IPERS employer share increases Increased graduation requirements Combined with fuel and insurance increases,

most districts will still be cutting program

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Spending Indicators

• Per pupil spending: NEA Fall 2005 rankings & estimates – shows Iowa slipped from 34th in FY 2003-04 to 37 in FY 2004-05.

• Total Expenditures: for K-12 schools (all revenue sources) Iowa slipped from 30th to 31st – with a 1.8% increase compared to the national average of 4.7%.

• Anecdotally – shortage area teaching positions and number of applicants prove that lower expenditures have resulted in lower salaries and it’s harder to recruit and retain employees.

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Spending Indicators

• Teacher salaries: According to AFT’s 2004 report, Iowa’s average teacher salary in 2003-04 fell to 42nd in the nation. Iowa’s ranking increased to 39th according to AFT’s 2004-05 report.

• Other states are investing too. (AL 6%, MS 8%, WV $6K increase in beginning pay.) It’s unknown if Iowa will reach 25th in the nation, even with TQ salary appropriations.

• Will people notice if teacher pay is not in the contract?

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Regional Teacher Pay

State Illinois Minnesota Wisconsin Nebraska Iowa Missouri

Average Pay Beginning Pay

$56,494 $37,500

$47,411 $31,632

$43,099 $25,222

$39,441 $29,303

$39,284 $27,284

$39,064 $29,281

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Spending Indicators/Trends

Fiscal Year

National Teacher Salary Percent Increase

Iowa Teacher Salary Percent Increase Difference

USA $ Average

Iowa $ Average

Iowa Shortfall

1993-94 $35,813 $30,760 $5,0532001-02 2.70% 2.00% -$2,071 $44,367 $37,243 $7,1242002-03 2.20% 1.00% -$ 454 $45,578 $38,000 $7,5782003-04 5.00% 3.10% -$ 638 $46,597 $38,381 $8,216

2004-05 2.20% 2.40% -$ 202 $47,602 $39,284 $8,418

Source: AFT: Survey and Analysis of Teacher Salary Trends, 2005

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Possible Explanations: Benefits

Iowa ranks 24th in the nation in percent of total salaries spent on employee benefits.

According to Common Core of Data, U.S. Dept. of Education, NCES April 2007, Iowa schools spent 29.8% of total salary expenditures on benefits. The national average was 30.7% in FY 2005.

Since Iowa teacher pay is below the national average, a lower percent of a lower wage proves total dollars spent on benefits are also below the national average.

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Why not increase teacher salary state categorical funds instead?

Usurps the bargaining process. District never gets credit for the salary

increase.The same dollars go farther in the funding

formula by matching local dollars.Destroys local control and both teacher and

management participation in the process.

Note – some districts with severe and continued declining enrollment won’t get new money through higher allowable growth, warranting some mechanism to address enrollment changes.

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#14 Enrollment Shift Challenges

Supports a school foundation formula that recognizes and adequately funds changes in demographics, including declining and increasing enrollment challenges.

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Enrollment change challenges

Funding is linear ($ per pupil) Enrollment change is lumpy Previous year count is basis for budget – delays

impact of decline for one year, also delays state funding for enrollment increases, so on-time funding must be included in cash reserve levy (property taxes)

Impacts staffing and building needs – in both directions

Budget guarantee is phasing out

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Iowa Public School Enrollment History

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Statewide Enrollment Change 1987 - 2006

4,532

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Shift Happens

Number of Iowa School Districts by Change of Enrollment 1987 - 2006

208 218

169140

113131

167

133165 176

208

245259 262

247 237224 231

215 222

167 158

207236

263245

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168

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136 133 144 137

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Declining Districts Growing Districts

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Key Messages:

•Virtually all children can achieve to high levels.

•Quality instruction is the key to improved student achievement.

•All students deserve a safe, technology-ready facility designed for learning.

•Investments in quality education are investments in Iowa’s future.

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Other Issues

Open Meetings / Public Records Property tax reform Compulsory attendance age Wellness

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We are here to help!

Ask questions, access tools or position papers, relay information to IASB government relations team, Margaret Buckton or Mary Gannon:

mbuckton@ia-sb.org or mgannon@ia-sb.org

(800)795-4272