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Georgia Vocational Directors Preserving Quality Education Amidst Troubled Waters (by understanding school finance) February 2011.

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1 Georgia Vocational Directors Preserving Quality Education Amidst Troubled Waters (by understanding school finance) February 2011

2 God, grant me the serenity to accept the things I cannot change, the courage to change the things I can, and the wisdom to know the difference. Reinhold Niebuhr (1892-1971), American Theologian

3 God, grant me the serenity to accept the things I cannot change, the courage to change the things I can, and the wisdom to know the difference. Reinhold Niebuhr (1892-1971), American Theologian

4 God, grant me the serenity to accept the things I cannot change, the courage to change the things I can, and the wisdom to know the difference. Reinhold Niebuhr (1892-1971), American Theologian

5 If we really do believe in public education, then we have a duty to bring to the public the message that quality education in Georgia is in peril, and along with it the future of our children and grandchildren

6 “Ask anyone who lobbies for public schools what it takes to improve education in Georgia and the answer is always the same. More Money.” Representative David Casas (R) from Lilburn in the Athens Banner-Herald, 3/7/2008 “…the answer isn’t simply more money, it’s more money well spent.” Maureen Downey, Atlanta Journal-Constitution, 9/7/2008

7 “Ask anyone who lobbies for public schools what it takes to improve education in Georgia and the answer is always the same. More Money.” Representative David Casas (R) from Lilburn in the Athens Banner-Herald, 3/7/2008 “…the answer isn’t simply more money, it’s more money well spent.” Maureen Downey, Atlanta Journal-Constitution, 9/7/2008

8 “Ask anyone who lobbies for public schools what it takes to improve education in Georgia and the answer is always the same. More Money.” Representative David Casas (R) from Lilburn in the Athens Banner-Herald, 3/7/2008 “…the answer isn’t simply more money, it’s more money well spent.” Maureen Downey, Atlanta Journal-Constitution, 9/7/2008

9 A New Era for School Funding We may well be are in a new era for financing public education in Georgia. Much of our current educational leadership, including our superintendents, principals, directors, and financial staffs, developed their leadership skills and adopted their financial practices and processes during what, in retrospect, can only be called a “time of plenty.”

10 “Mike Petrilli, vice president at the Thomas B. Fordham Institute, a Washington think tank that advocates tougher education standards, said districts should focus on eliminating wasteful spending and making targeted cuts. “His ideas? Beef up class sizes in higher grades, but leave them small during the early years where academic research shows they have the most benefit. Rethink teacher compensation, which pays teachers based on experience and education level, but not necessarily by effectiveness. And look at scaling back pensions and health care plans that were cut long ago in the private sector. “’The funding cliff is coming – it is going to happen,’ said Petrilli. ‘There is no money left and we’re going to have to learn to live in a new normal.’” Atlanta Journal Constitution November 11, 2011

11 “Mike Petrilli, vice president at the Thomas B. Fordham Institute, a Washington think tank that advocates tougher education standards, said districts should focus on eliminating wasteful spending and making targeted cuts. “His ideas? Beef up class sizes in higher grades, but leave them small during the early years where academic research shows they have the most benefit. Rethink teacher compensation, which pays teachers based on experience and education level, but not necessarily by effectiveness. And look at scaling back pensions and health care plans that were cut long ago in the private sector. “’The funding cliff is coming – it is going to happen,’ said Petrilli. ‘There is no money left and we’re going to have to learn to live in a new normal.’” Atlanta Journal Constitution November 11, 2011

12 “Mike Petrilli, vice president at the Thomas B. Fordham Institute, a Washington think tank that advocates tougher education standards, said districts should focus on eliminating wasteful spending and making targeted cuts. “His ideas? Beef up class sizes in higher grades, but leave them small during the early years where academic research shows they have the most benefit. Rethink teacher compensation, which pays teachers based on experience and education level, but not necessarily by effectiveness. And look at scaling back pensions and health care plans that were cut long ago in the private sector. “’The funding cliff is coming – it is going to happen,’ said Petrilli. ‘There is no money left and we’re going to have to learn to live in a new normal.’” Atlanta Journal Constitution November 11, 2011

13 A new normal??

14 From the AJC Senate’s budget writer says state’s hole is deeper than predicted 8:53 pm December 13, 2010, by Aaron Gould Sheinin Senate Appropriations Chairman Jack Hill, R-Reidsville, warned Monday that the state’s budget hole for next fiscal year is closer to $2 billion than to the $1 billion that’s been discussed. Hill was in Athens with other lawmakers for a pre-legislative session conference and spoke to WABE’s Denis O’Hayer, the local host of “All Things Considered.” You can hear the entire interview on WABE’s website In the the interview, Hill acknowledged that the state’s budget hole for fiscal 2012, which begins July 1, is at about $2 billion and drops to $1.3 billion once you consider the loss of one-time funding or federal cash as well an expected round of cuts to state agencies. Despite the positive news that state revenues are growing, Hill said it’s not enough. “The growth rate that the economists tell us we can expect is not high enough to make up for the tremendous hole we have,” Hill told O’Hayer. O’Hayer asked the next logical question: Where does the money come from? Could it be that the special tax council that has been studying the state’s finances will recommend putting the sales tax back on groceries? Hill said he didn’t know, but A.D. Fraizer, the head of the tax council, will speak to lawmakers in Athens on Tuesday. The council’s report is due to lawmakers no later than Jan. 10, the first day of the next legislative session. “I don’t find a whole lot of support for [putting the sales tax on groceries] in walking around the halls,” Hill said, acknowledging that he and others need to “educate members of the House and Senate on how deep the hole is and how big the problem is.” It’s not an easy answer, Hill said, but the bottom line is the state needs to raise more money. “That’s what it boils down to,” he said.

15 From the AJC Senate’s budget writer says state’s hole is deeper than predicted 8:53 pm December 13, 2010, by Aaron Gould Sheinin Senate Appropriations Chairman Jack Hill, R-Reidsville, warned Monday that the state’s budget hole for next fiscal year is closer to $2 billion than to the $1 billion that’s been discussed. Hill was in Athens with other lawmakers for a pre-legislative session conference and spoke to WABE’s Denis O’Hayer, the local host of “All Things Considered.” You can hear the entire interview on WABE’s website. In the the interview, Hill acknowledged that the state’s budget hole for fiscal 2012, which begins July 1, is at about $2 billion and drops to $1.3 billion once you consider the loss of one-time funding or federal cash as well an expected round of cuts to state agencies. Despite the positive news that state revenues are growing, Hill said it’s not enough. “The growth rate that the economists tell us we can expect is not high enough to make up for the tremendous hole we have,” Hill told O’Hayer. O’Hayer asked the next logical question: Where does the money come from? Could it be that the special tax council that has been studying the state’s finances will recommend putting the sales tax back on groceries? Hill said he didn’t know, but A.D. Fraizer, the head of the tax council, will speak to lawmakers in Athens on Tuesday. The council’s report is due to lawmakers no later than Jan. 10, the first day of the next legislative session. “I don’t find a whole lot of support for [putting the sales tax on groceries] in walking around the halls,” Hill said, acknowledging that he and others need to “educate members of the House and Senate on how deep the hole is and how big the problem is.” It’s not an easy answer, Hill said, but the bottom line is the state needs to raise more money. “That’s what it boils down to,” he said.

16 Board members: “You said that last year and the year before! We always come out okay…” Superintendents: “Sure, if you say you really need it…” Budget/Finance Director: “I’ve hidden money in several places in this budget…” Principals and Directors: “The budget’s not our problem! Just tell us what we have to spend!” Title I/Title VIB Director: “Here’s where I’m going to spend “my” money next year…” CTAE Directors: “Vocational programs get higher funding, so I’ll be just fine. Besides, I have all of those state grants

17 Board members: “You said that last year and the year before! We always come out okay…” Superintendents: “Sure, if you say you really need it…” Budget/Finance Director: “I’ve hidden money in several places in this budget…” Principals and Directors: “The budget’s not our problem! Just tell us what we have to spend!” Title I/Title VIB Director: “Here’s where I’m going to spend “my” money next year…” CTAE Directors: “Vocational programs get higher funding, so I’ll be just fine. Besides, I have all of those state grants

18 Board members: “You said that last year and the year before! We always come out okay…” Superintendents: “Sure, if you say you really need it…” Budget/Finance Director: “I’ve hidden money in several places in this budget…” Principals and Directors: “The budget’s not our problem! Just tell us what we have to spend!” Title I/Title VIB Director: “Here’s where I’m going to spend “my” money next year…” CTAE Directors: “Vocational programs get higher funding, so I’ll be just fine. Besides, I have all of those state grants

19 Board members: “You said that last year and the year before! We always come out okay…” Superintendents: “Sure, if you say you really need it…” Budget/Finance Director: “I’ve hidden money in several places in this budget…” Principals and Directors: “The budget’s not our problem! Just tell us what we have to spend!” Title I/Title VIB Director: “Here’s where I’m going to spend “my” money next year…” CTAE Directors: “Vocational programs get higher funding, so I’ll be just fine. Besides, I have all of those state grants

20 Board members: “You said that last year and the year before! We always come out okay…” Superintendents: “Sure, if you say you really need it…” Budget/Finance Director: “I’ve hidden money in several places in this budget…” Principals and Directors: “The budget’s not our problem! Just tell us what we have to spend!” Title I/Title VIB Director: “Here’s where I’m going to spend “my” money next year…” CTAE Directors: “Vocational programs get higher funding, so I’ll be just fine. Besides, I have all of those state grants

21 Board members: “You said that last year and the year before! We always come out okay…” Superintendents: “Sure, if you say you really need it…” Budget/Finance Director: “I’ve hidden money in several places in this budget…” Principals and Directors: “The budget’s not our problem! Just tell us what we have to spend!” Title I/Title VIB Director: “Here’s where I’m going to spend “my” money next year…” CTAE Directors: “Vocational programs get higher funding, so I’ll be just fine. Besides, I have all of those state grants”

22 What a mess! How did we ever get into this situation?

23 “The Picture” In the first 15 years following the passage of Quality Basic Education as the law in Georgia, governors and legislators, with minor exceptions, generally provided the funding required by the law Around 2002, a combination of the short, shallow recession that occurred at that time and what appears to be a coincident change in philosophy in the political leadership in Atlanta resulted in an increasing pullback on funding the mandates of the 1985 law. Ironically (and fortunately for the children of Georgia), a national housing “boom” emerged at the same time the state funding cuts began to be imposed, and as fast as the state took money from schools, local tax digests replaced that funding…and then some!

24 “The Picture” In the first 15 years following the passage of Quality Basic Education as the law in Georgia, governors and legislators, with minor exceptions, generally provided the funding required by the law Around 2002, a combination of the short, shallow recession that occurred at that time and what appears to be a coincident change in philosophy in the political leadership in Atlanta resulted in an increasing pullback on funding the mandates of the 1985 law. Ironically (and fortunately for the children of Georgia), a national housing “boom” emerged at the same time the state funding cuts began to be imposed, and as fast as the state took money from schools, local tax digests replaced that funding…and then some!

25 “The Picture” In the first 15 years following the passage of Quality Basic Education as the law in Georgia, governors and legislators, with minor exceptions, generally provided the funding required by the law Around 2002, a combination of the short, shallow recession that occurred at that time and what appears to be a coincident change in philosophy in the political leadership in Atlanta resulted in an increasing pullback on funding the mandates of the 1985 law. Ironically (and fortunately for the children of Georgia), a national housing “boom” emerged at the same time the state funding cuts began to be imposed, and as fast as the state took money from schools, local tax digests replaced that funding…and then some!

26 …and suddenly the party is over…

27 In order to answer that question, let’s take some time to review: “Georgia School Funding 101”

28 School systems in Georgia receive most or all of their funding from three sources: 1) State 2) Local 3) Federal

29 State Revenues

30 Each year, the state provides all school systems with an “allotment sheet” which details about 97% of the state funding provided to those school systems

31 FY11 Initial Allotment Sheet Funding

32 State Revenue Quality Basic Education funding Mid-term adjustment Miscellaneous grants

33 State Revenue Quality Basic Education funding Mid-term adjustment Miscellaneous grants

34 Quality Basic Education (QBE) Funding Perhaps the least understood and yet the most important part of a school system’s funding

35 ARTICLE VIII. EDUCATION SECTION I. PUBLIC EDUCATION Paragraph I. Public education; free public education prior to college or postsecondary level; support by taxation. The provision of an adequate public education for the citizens shall be a primary obligation of the State of Georgia. Public education for the citizens prior to the college or postsecondary level shall be free and shall be provided for by taxation. The expense of other public education shall be provided for in such manner and in such amount as may be provided by law.

36 ARTICLE VIII. EDUCATION SECTION I. PUBLIC EDUCATION Paragraph I. Public education; free public education prior to college or postsecondary level; support by taxation. The provision of an adequate public education for the citizens shall be a primary obligation of the State of Georgia. Public education for the citizens prior to the college or postsecondary level shall be free and shall be provided for by taxation. The expense of other public education shall be provided for in such manner and in such amount as may be provided by law.

37 The Quality Basic Education (QBE) Act of 1985 was designed to put in place a funding mechanism whereby every child in Georgia, no matter where he or she lived, had access to an education that received sufficient funding to provide a Quality (not mediocre) Basic (not a Cadillac, but a Chevy) Education

38 The Quality Basic Education (QBE) Act of 1985 was designed to put in place a funding mechanism whereby every child in Georgia, no matter where he or she lived, had access to an education that received sufficient funding to provide a Quality (not mediocre) Basic (not a Cadillac, but a Chevy) Education

39 The Quality Basic Education (QBE) Act of 1985 was designed to put in place a funding mechanism whereby every child in Georgia, no matter where he or she lived, had access to an education that received sufficient funding to provide a Quality (not mediocre) Basic (not a Cadillac, but a Chevy) Education

40 The Quality Basic Education (QBE) Act of 1985 was designed to put in place a funding mechanism whereby every child in Georgia, no matter where he or she lived, had access to an education that received sufficient funding to provide a Quality (not mediocre) Basic (not a Cadillac, but a Chevy) Education

41 The portion of the QBE Act that defines the funding of public schools divides that funding into two main parts: 1) The amount of funding that would be necessary to provide for basic education; and 2) The funding that would allow systems to offer more than basic education

42 The portion of the QBE Act that defines the funding of public schools divides that funding into two main parts: 1) The amount of funding that would be necessary to provide for basic education; and 2) The funding that would allow systems to offer more than basic education

43 Funding Public Education in Georgia QBE Minimum Funding Optional additional funding

44 The QBE law specified that the funding of education was a shared responsibility between the state and local communities. Thus, the law specified that local communities would be required to contribute their “local fair share” to the basic educational funding plus optional funding extending education beyond “quality, basic”

45 Funding Public Education in Georgia QBE Minimum Funding

46 Funding Public Education in Georgia QBE Minimum Funding State’s responsibility Req’d Local Share

47 Funding Public Education in Georgia QBE Minimum Funding State’s responsibility Local school system’s responsibility Req’d Local Share Optional additional funding

48 Included on each system’s allotment sheet is significant detail describing the total funding earned under the Quality Basic Education formula

49 For this initial FTE

50 This is the funding level for a Quality, Basic, Education

51 This part of QBE is for salaries (about 92%)…

52 This part of QBE is for salaries (about 92%)… And this much is for operations (about 8%)

53 The QBE Act establishes 19 educational programs, and defines (partly in adjusted dollars, but partly in 1985 dollars) what resources, and what accompanying funding, is required to support each of those programs These programs are listed on in the far left column of the allotment sheets

54 19 QBE Education Programs

55 The QBE Act identifies, for each program, the necessary personnel and non- personnel support resources needed to support that program at the basic level. Personnel are funded according to a set of ratios. For example, for every 15 kindergarten full-time equivalent students (FTEs), funding for one teacher is included in the formula. The ratios vary by program and for different positions (e.g., teacher, social worker, assistant principal, etc.)

56 Funding elements for vocational program

57 Te Teacher funding 20-1 Counselor funding 400-1 Tech specialist funding 1100-1 Psychologist funding 2475-1 Social worker funding 2475-1 Asst Principal funding 435-1 Secretary funding 435-1 Librarian funding 970-1 CTAE Personnel Funding Ratios

58 Funding certified salaries and paraprofessionals

59 Funding detail for salary elements in QBE funding formula

60

61 In order to ensure that a system’s QBE funding reflects the extra costs of teachers with experience and advanced degrees, the state adjusts all parts of the QBE formula that reflect costs of certified personnel. That adjustment uses something called the “Training and Experience (T&E) Modifier”

62 In order to ensure that a system’s QBE funding reflects the extra costs of teachers with experience and advanced degrees, the state adjusts all parts of the QBE formula that reflect costs of certified personnel. That adjustment uses something called the “Training and Experience (T&E) Modifier”

63 The T&E Modifier is calculated from the additional salary and benefit costs over the state base amount and, essentially, adds that amount to the QBE base earnings in an effort to fund teachers’ full salaries and state benefits. While a system’s T&E calculations are more complicated than the following illustration, it nevertheless is an approximation of how a new employee’s salary impacts T&E

64 The T&E Modifier is calculated from the additional salary and benefit costs over the state base amount and, essentially, adds that amount to the QBE base earnings in an effort to fund teachers’ full salaries and state benefits. While a system’s T&E calculations are more complicated than the following illustration, it nevertheless is an approximation of how a new employee’s salary impacts T&E

65 Assume you earn 5 teachers and hire 5 teachers TeacherCert/ExpState Pay Teacher 1T4,10$42,113 Teacher 2T4, Entry$33,424 Teacher 3T5,12$49,881 Teacher 4T6,19$63,440 Teacher 5T7,16$66,375 Teacher 6T5,8$47,017 Teacher 7T7,16$66,375 Total of 5 teachers$255,233 (Cost with state benefits)$339,776 T&E52.5469 State Earnings (5X$44,547 x1.525445)$339,776

66 Assume you earn 5 teachers and hire 6 teachers TeacherCert/ExpState Pay Teacher 1T4,10$42,113 Teacher 2T4, Entry$33,424 Teacher 3T5,12$49,881 Teacher 4T6,19$63,440 Teacher 5T7,16$66,375 Teacher 6T5,8$47,017 Teacher 7T7,16$66,375 Total of 6 teachers$302,250 (Cost with state benefits)$402,379 T&E60.6531 State Earnings (5X$44,547 x1.606531)$357,832 Net costs after state increase$44,547

67 Assume you earn 5 teachers and hire 6 teachers TeacherCert/ExpState Pay Teacher 1T4,10$42,113 Teacher 2T4, Entry$33,424 Teacher 3T5,12$49,881 Teacher 4T6,19$63,440 Teacher 5T7,16$66,375 Teacher 6T5,8$47,017 Teacher 7T7,16$66,375 Total of 6 teachers$321,608 (Cost with state benefits)$428,092 T&E72.1974 State Earnings (5X$44,547 x1.721974)$383,545 Net costs after state increase$44,547

68 Implications for T&E Base Salary ($44,547/position) for “earned” positions Number of positions

69 Implications for T&E Base Salary ($44,547/position) for “earned” positions Number of positions Extra salary earned from experience and advanced degrees

70 Implications for T&E Base Salary ($44,547/position) for “earned” positions Number of positions Extra salary earned from experience and advanced degrees Base salary for positions beyond those earned

71 Implications for T&E Base Salary ($44,547/position) for “earned” positions Number of positions Extra salary earned from experience and advanced degrees Base salary for positions beyond those earned Additional excess salaries

72 Implications for T&E Base Salary ($44,547/position) for “earned” positions Number of positions Extra salary earned from experience and advanced degrees Base salary for positions beyond those earned Additional excess salaries Amount of payroll included in QBE funding

73 In summary… Because the state funds “more expensive” teachers at a higher funding rate, the cost difference to a system between hiring “expensive” teachers and “inexpensive” teachers is much less than their actual salaries Conclusion: Systems should hire teachers based upon their expertise and the system’s needs, not based upon their pay grade

74 In summary… Because the state funds “more expensive” teachers at a higher funding rate, the cost difference to a system between hiring “expensive” teachers and “inexpensive” teachers is much less than their actual salaries Conclusion: Systems should hire teachers based upon their expertise and the system’s needs, not based upon their pay grade

75 Sample Systems’ FY11 T&E Modifiers SystemFY11 T&E Modifier Greene55.4904 Pelham City56.6133 Dade50.6686 Rabun65.9401 Seminole57.4799 Charlton62.4769 Bibb45.4219 Gwinnett46.2921 Fulton41.8189 Cobb45.4607 Webster48.5802 Quitman59.7641 Baker59.1503 Atlanta City51.7905

76 Sample Systems’ FY11 T&E Modifiers SystemFY11 T&E Modifier Greene55.4904 Pelham City56.6133 Dade50.6686 Rabun65.9401 Seminole57.4799 Charlton62.4769 Bibb45.4219 Gwinnett46.2921 Fulton41.8189 Cobb45.4607 Webster48.5802 Quitman59.7641 Baker59.1503 Atlanta City51.7905

77 Sample Systems’ FY11 T&E Modifiers SystemFY11 T&E Modifier Greene55.4904 Pelham City56.6133 Dade50.6686 Rabun65.9401 Seminole57.4799 Charlton62.4769 Bibb45.4219 Gwinnett46.2921 Fulton41.8189 Cobb45.4607 Webster48.5802 Quitman59.7641 Baker59.1503 Atlanta City51.7905

78 Sample Systems’ FY11 T&E Modifiers SystemFY11 T&E Modifier Greene55.4904 Pelham City56.6133 Dade50.6686 Rabun65.9401 Seminole57.4799 Charlton62.4769 Bibb45.4219 Gwinnett46.2921 Fulton41.8189 Cobb45.4607 Webster48.5802 Quitman59.7641 Baker59.1503 Atlanta City51.7905

79 One Georgia system has an FY11 T&E multiplier of 51.1776 This figure comes from a calculation that in the 2009-10 school year, the system’s certified personnel earned 51.18% more in salary and state benefits than if they were all beginning teachers Thus, in this system, each earned position is funded: State base: $44,547.10 T&E (51.1776% more): $22,798.14 Total Per Position Funding:$67,345.24

80 Each certified position’s QBE funding is adjusted to reflect the average salary in each individual school system

81 . Certified positions

82 Non-certified positions are funded at a flat, pre-determined rate that is the same for every system in the entire state

83 . Non-certified positions

84 Finally, operational expenses are funded at a flat, pre-determined rate that is also the same for every system in Georgia

85 .Operations

86 Funding Administrative Functions under QBE

87 Funding for central office operations

88 School administrative funding for K through 5 th grade

89 School administrative funding for middle school, special education, gifted, remedial and ESOL

90 School administrative funding for high school regular ed and vocational ed

91

92 The Impact of Inflation in the Classroom In 2002, vocational education classroom operations (non- personnel) were funded at the rate of $327.96 per FTE. Inflated to 2010 dollars, it would take 22.8% more, or $403.73 per FTE to buy the same amount of goods and services as the $327.96 could buy 8 years earlier Instead, the funding actually decreased to $312.81, effectively resulting in a “shortfall” of $402.73 minus $312.81 or just under $90 per student. If the average vocational teacher taught an average of 20 students per period, that would mean he/she would see a “shortage” of classroom supply funding of about $1,800 per teacher Contrast that to the $100 gift cards the state legislature gave to teachers last year and the year before!

93

94 The Impact of Inflation in the Classroom In 2002, vocational education classroom operations (non- personnel) were funded at the rate of $327.96 per FTE. Inflated to 2010 dollars, it would take 22.8% more, or $403.73 per FTE to buy the same amount of goods and services as the $327.96 could buy 8 years earlier Instead, the funding actually decreased to $312.81, effectively resulting in a “shortfall” of $402.73 minus $312.81 or just under $90 per student. If the average vocational teacher taught an average of 20 students per period, that would mean he/she would see a “shortage” of classroom supply funding of about $1,800 per teacher Contrast that to the $100 gift cards the state legislature gave to teachers last year and the year before!

95 The Impact of Inflation in the Classroom In 2002, vocational education classroom operations (non- personnel) were funded at the rate of $327.96 per FTE. Inflated to 2010 dollars, it would take 22.8% more, or $403.73 per FTE to buy the same amount of goods and services as the $327.96 could buy 8 years earlier Instead, the funding actually decreased to $312.81, effectively resulting in a “shortfall” of $402.73 minus $312.81 or just under $90 per student. If the average vocational teacher taught an average of 20 students per period, that would mean he/she would see a “shortage” of classroom supply funding of about $1,800 per teacher Contrast that to the $100 gift cards the state legislature gave to teachers last year and the year before!

96

97 The Impact of Inflation in the Classroom In 2002, vocational education classroom operations (non- personnel) were funded at the rate of $327.96 per FTE. Inflated to 2010 dollars, it would take 22.8% more, or $403.73 per FTE to buy the same amount of goods and services as the $327.96 could buy 8 years earlier Instead, the funding actually decreased to $312.81, effectively resulting in a “shortfall” of $402.73 minus $312.81 or just under $90 per student. If the average vocational teacher taught an average of 20 students per period, that would mean he/she would see a “shortage” of classroom supply funding of about $1,800 per teacher Contrast that to the $100 gift cards the state legislature gave to teachers last year and the year before!

98 The Impact of Inflation in the Classroom In 2002, vocational education classroom operations (non- personnel) were funded at the rate of $327.96 per FTE. Inflated to 2010 dollars, it would take 22.8% more, or $403.73 per FTE to buy the same amount of goods and services as the $327.96 could buy 8 years earlier Instead, the funding actually decreased to $312.81, effectively resulting in a “shortfall” of $402.73 minus $312.81 or just under $90 per student. If the average vocational teacher taught an average of 20 students per period, that would mean he/she would see a “shortage” of classroom supply funding of about $1,800 per teacher Contrast that to the $100 gift cards the state legislature gave to teachers last year and the year before!

99

100

101

102

103 Because each system has different average teacher salaries, each system receives different funding for each of the 19 QBE programs. A sample FY11 program funding is as follows:

104 System: Sample QBE Per-FTE Program Earnings Basic Levels vs. Actual FY11 Levels T&E Modifier---------------------------------->51.1776 Equalization Earnings per FTE-----:----------> $264 ProgramBase FundingActual Funding Gr K$4,604$6,303 EIP K$5,692$7,943 Gr 1-3$3,565$5,151 EIP 1-3$5,005$7,322 Gr 4-5$2,860$4,097 EIP 4-5$4,989$7,307 MG*$2,927$4,199 MS*$3,220$4,640 Gr 9-12*$2,880$4,104 Vocational*$3,388$4,760 SpEd I$6,645$9,720 SpEd II$7,822$11,555 SpEd III$9,966$14,752 SpEd IV$16,169$23,994 SpEd V$6,819$9,894 Gifted$4,627$6,752 Remedial$3,642$5,289 ESOL$7,031$10,400 * includes 2.5% allotment for alternative education

105 TCEReg Ed SystemT&EFundingHS Bleckley60.4354$4,871$4,204 Oglethorpe55.3372$4,818$4,156 Sav- Chatham51.3847$4,714$4,063 Echols44.1603$4,522$3,892

106 The only QBE funding not earned by the FTE count is funding for: 1 superintendent 2, 4 or 6 assistant superintendents 1 principal for each school 1 central office secretary 1 central office account/bookkeeper

107 In other words, the FTE count accounts for about 96% of most systems’ QBE funding

108 In other words, the FTE count accounts for about 96% of most systems’ QBE funding COUNT CAREFULLY !!

109 State Revenue Quality Basic Education funding Mid-term adjustment Miscellaneous grants

110 Initially, the state uses a formula to estimate the number of students that will populate a school system at the beginning of any given year. This “initial FTE count” determines the initial QBE funding

111 Once the October FTE count is completed and officially transmitted, the state uses that count plus the previous two counts (October and March last school year) to develop the FTE count that is used to adjust funding for the current year in an effort to adequately fund any growth above original enrollment estimates. If the new FTE calculations indicate that a system has earned funding above the system’s initial funding, the system is given a “mid-term adjustment” equal to the increased funding. If a lower level of funding results from the new numbers, the state does not take that away from a system, but starts the next school year at the lower level

112 Once the October FTE count is completed and officially transmitted, the state uses that count plus the previous two counts (October and March last school year) to develop the FTE count that is used to adjust funding for the current year in an effort to adequately fund any growth above original enrollment estimates. If the new FTE calculations indicate that a system has earned funding above the system’s initial funding, the system is given a “mid-term adjustment” equal to the increased funding. If a lower level of funding results from the new numbers, the state does not take that away from a system, but starts the next school year at the lower level

113 Once the October FTE count is completed and officially transmitted, the state uses that count plus the previous two counts (October and March last school year) to develop the FTE count that is used to adjust funding for the current year in an effort to adequately fund any growth above original enrollment estimates. If the new FTE calculations indicate that a system has earned funding above the system’s initial funding, the system is given a “mid-term adjustment” equal to the increased funding. If a lower level of funding results from the new numbers, the state does not take that away from a system (the system is considered “held harmless”, but starts the next school year at the lower level

114 Once the October FTE count is completed and officially transmitted, the state uses that count plus the previous two counts (October and March last school year) to develop the FTE count that is used to adjust funding for the current year in an effort to adequately fund any growth above original enrollment estimates. If the new FTE calculations indicate that a system has earned funding above the system’s initial funding, the system is given a “mid-term adjustment” equal to the increased funding. If a lower level of funding results from the new numbers, the state does not take that away from a system (the system is considered “held harmless”, but starts the next school year at the lower level

115 This example system was initially funded for 1,492 FTE’s plus 16 alternative school FTE’s (1,508 total FTE’s) for the 2010-11 school year At mid-term, as a result of decreased enrollment, the system’s funded FTE decreased to 1,462 FTE’s plus 16 alternative school FTE’s (1,478 total FTE’s) for a loss of 30 FTE’s The loss in students (and changes in program FTE’s) equate to a funding decrease for the County of about $215,000

116 Initial FTE

117 MidTerm Initial Calculations InitialMidterm Per FTEProgram FTE DifferenceEarnings Gr K 114107-7x$6,167=-$43,166 EIP K 583x$7,766=$23,299 Gr 1-3 343333-10x$5,034=-$50,336 EIP 1-3 18224x$7,151=$28,604 Gr 4-5 2122208x$4,005=$32,043 EIP 4-5 2117-4x$7,136=-$28,542 MG* 000x$4,105=$0 MS* 283268-15x$4,535=-$68,030 Gr 9-12* 27330027x$4,014=$108,371 Vocational* 9678-18x$4,659=-$83,857 SpEd I 92-7x$9,493=-$66,451 SpEd II 3127-4x$11,279=-$45,116 SpEd III 3833-5x$14,398=-$71,988 SpEd IV 572x$23,415=$46,830 SpEd V 154x$9,666=$38,666 Gifted 11154x$6,595=$26,380 Remedial 2715-12x$5,167=-$62,003 ESOL 550x$10,151=$50,755 Total 14921462-30 -$164,541

118 This example system was initially funded for 1,492 FTE’s plus 16 alternative school FTE’s (1,508 total FTE’s) for the 2010-11 school year At mid-term, as a result of decreased enrollment, the system’s funded FTE decreased to 1,462 FTE’s plus 16 alternative school FTE’s (1,478 total FTE’s) for a loss of 30 FTE’s The loss in students (and changes in program FTE’s) equate to a funding decrease for the County of about $215,000

119 FTE Calculations – Midterm FY11 and Initial FY12 ProgramOct10Mar10Oct09MidTerm/FY11 Count Funding K105117111107 EIP-K9558 Gr 1-3334336342333 EIP 1-32317 22 Gr 4-5222213215220 EIP 4-516212217 MG0000 MS266283287268 HS310256274300 Voc741019578 SpI2462 Sp II26323127 Sp III32363833 Sp IV7657 Sp V6315 Gifted14231215 Remedial1327 15 Alt Sch16 ESOL5555 Total1480150115091478 The October count has twice the weight of the other two counts

120 MidTerm Initial Calculations InitialMidterm Per FTEProgram FTE DifferenceEarnings Gr K 114107-7x$6,167=-$43,166 EIP K 583x$7,766=$23,299 Gr 1-3 343333-10x$5,034=-$50,336 EIP 1-3 18224x$7,151=$28,604 Gr 4-5 2122208x$4,005=$32,043 EIP 4-5 2117-4x$7,136=-$28,542 MG* 000x$4,105=$0 MS* 283268-15x$4,535=-$68,030 Gr 9-12* 27330027x$4,014=$108,371 Vocational* 9678-18x$4,659=-$83,857 SpEd I 92-7x$9,493=-$66,451 SpEd II 3127-4x$11,279=-$45,116 SpEd III 3833-5x$14,398=-$71,988 SpEd IV 572x$23,415=$46,830 SpEd V 154x$9,666=$38,666 Gifted 11154x$6,595=$26,380 Remedial 2715-12x$5,167=-$62,003 ESOL 550x$10,151=$50,755 Total 14921462-30 -$164,541

121 This example system was initially funded for 1,492 FTE’s plus 16 alternative school FTE’s (1,508 total FTE’s) for the 2010-11 school year At mid-term, as a result of decreased enrollment, the system’s funded FTE decreased to 1,462 FTE’s plus 16 alternative school FTE’s (1,478 total FTE’s) for a loss of 30 FTE’s The loss in students (and changes in program FTE’s) equate to a funding decrease for the County of about $215,000

122 MidTerm Initial Calculations InitialMidterm Per FTEProgram FTE DifferenceEarnings Gr K 114107-7x$6,167=-$43,166 EIP K 583x$7,766=$23,299 Gr 1-3 343333-10x$5,034=-$50,336 EIP 1-3 18224x$7,151=$28,604 Gr 4-5 2122208x$4,005=$32,043 EIP 4-5 2117-4x$7,136=-$28,542 MG* 000x$4,105=$0 MS* 283268-15x$4,535=-$68,030 Gr 9-12* 27330027x$4,014=$108,371 Vocational* 9678-18x$4,659=-$83,857 SpEd I 92-7x$9,493=-$66,451 SpEd II 3127-4x$11,279=-$45,116 SpEd III 3833-5x$14,398=-$71,988 SpEd IV 572x$23,415=$46,830 SpEd V 154x$9,666=$38,666 Gifted 11154x$6,595=$26,380 Remedial 2715-12x$5,167=-$62,003 ESOL 550x$10,151=$0 Total 14921462-30 -$215,296

123 The system will be held harmless for FY11, meaning that they will be allowed to keep the excess funding. In FY12, they will begin the school year with the decreased funding, with the exact amount depending on any changes the state makes in the QBE formula next year

124 A quick note on inflation and QBE funding Except for politically popular teacher pay raises, the state hasn’t increased most of QBE funding for inflation. Additionally, the state has for the past 8 years routinely balanced the budget by taking “austerity cuts” from the state’s public schools. If systems are to maintain the original intent of Quality, Basic Education, they need to make up this neglected funding with local tax dollars. Hill…

125 A quick note on inflation and QBE funding Except for politically popular teacher pay raises, the state hasn’t increased most of QBE funding for inflation. Additionally, the state has for the past 8 years routinely balanced the budget by taking “austerity cuts” from the state’s public schools. If systems are to maintain the original intent of Quality, Basic Education, they need to make up this neglected funding with local tax dollars. …

126 A quick note on inflation and QBE funding Except for politically popular teacher pay raises, the state hasn’t increased most of QBE funding for inflation. Additionally, the state has for the past 8 years routinely balanced the budget by taking “austerity cuts” from the state’s public schools. If systems are to maintain the original intent of Quality, Basic Education, they need to make up this neglected funding with local tax dollars.

127 A quick note on inflation and QBE funding Except for politically popular teacher pay raises, the state hasn’t increased most of QBE funding for inflation. Additionally, the state has for the past 8 years routinely balanced the budget by taking “austerity cuts” from the state’s public schools. If systems are to maintain the original intent of Quality, Basic Education, they need to make up this neglected funding with local tax dollars. Consider following scenario…

128 Funding Public Education in Georgia QBE Minimum Funding State’s responsibility Local school system’s responsibility Req’d Local Share Optional additional funding

129 Funding Public Education in Georgia QBE Minimum Funding State’s responsibility Local school system’s responsibility Req’d Local Share Optional additional funding Increased cost of quality, basic education due to inflation

130 Funding Public Education in Georgia QBE Minimum Funding State’s responsibility Local school system’s responsibility Req’d Local Share Optional additional funding Increased cost of quality, basic education due to inflation

131 Funding Public Education in Georgia QBE Minimum Funding State’s responsibility Local school system’s responsibility Req’d Local Share Optional additional funding Increased cost of quality, basic education due to inflation State austerity cuts

132 Funding Public Education in Georgia QBE Minimum Funding State’s responsibility Local school system’s responsibility Req’d Local Share Optional additional funding Increased cost of quality, basic education due to inflation State austerity cuts

133 What if…. …the state had indexed funding for operations to inflation from 2002 (the last recession) to the current year? …the state had indexed transportation to inflation for the same time period? …the state eliminated austerity cuts made to QBE funding?

134 What if…. …the state had indexed funding for operations to inflation from 2002 (the last recession) to the current year? …the state had indexed transportation to inflation for the same time period? …the state eliminated austerity cuts made to QBE funding?

135 What if…. …the state had indexed funding for operations to inflation from 2002 (the last recession) to the current year? …the state had indexed transportation to inflation for the same time period? …the state eliminated austerity cuts made to QBE funding?

136 What if…. …the state had indexed funding for operations to inflation from 2002 (the last recession) to the current year? …the state had indexed transportation to inflation for the same time period? …the state eliminated austerity cuts made to QBE funding?

137 Statewide Inflationary and Austerity Impact "What if" FY02FY11 "What if" Funding Increase FTE 1,447,3321,643,202 Operations Funding $622,383,491$697,712,715$867,719,229$170,006,514 Per FTE $430$425$528 Transp. Funding $177,551,705$136,758,992$247,540,352$110,781,360 Per FTE $123$83$151 Austerity $0-$1,082,853,841$0$1,082,853,841 Federal Stimulus $0$126,169,757$0-$126,169,757 Increased FY11 funding if above adjustments were made $1,237,471,958 Actual Statewide Initial Allotment for FY11 $6,875,049,714 Percentage that QBE is underfunded by state's actions and inactions 18%

138 Statewide Inflationary and Austerity Impact "What if" FY02FY11 "What if" Funding Increase FTE 1,447,3321,643,202 Operations Funding $622,383,491$697,712,715$867,719,229$170,006,514 Per FTE $430$425$528 Transp. Funding $177,551,705$136,758,992$247,540,352$110,781,360 Per FTE $123$83$151 Austerity $0-$1,082,853,841$0$1,082,853,841 Federal Stimulus $0$126,169,757$0-$126,169,757 Increased FY11 funding if above adjustments were made $1,237,471,958 Actual Statewide Initial Allotment for FY11 $6,875,049,714 Percentage that QBE is underfunded by state's actions and inactions 18%

139 Statewide Inflationary and Austerity Impact "What if" FY02FY11 "What if" Funding Increase FTE 1,447,3321,643,202 Operations Funding $622,383,491$697,712,715$867,719,229$170,006,514 Per FTE $430$425$528 Transp. Funding $177,551,705$136,758,992$247,540,352$110,781,360 Per FTE $123$83$151 Austerity $0-$1,082,853,841$0$1,082,853,841 Federal Stimulus $0$126,169,757$0-$126,169,757 Increased FY11 funding if above adjustments were made $1,237,471,958 Actual Statewide Initial Allotment for FY11 $6,875,049,714 Percentage that QBE is underfunded by state's actions and inactions 18%

140 Statewide Inflationary and Austerity Impact "What if" FY02FY11 "What if" Funding Increase FTE 1,447,3321,643,202 Operations Funding $622,383,491$697,712,715$867,719,229$170,006,514 Per FTE $430$425$528 Transp. Funding $177,551,705$136,758,992$247,540,352$110,781,360 Per FTE $123$83$151 Austerity $0-$1,082,853,841$0$1,082,853,841 Federal Stimulus $0$126,169,757$0-$126,169,757 Increased FY11 funding if above adjustments were made $1,237,471,958 Actual Statewide Initial Allotment for FY11 $6,875,049,714 Percentage that QBE is underfunded by state's actions and inactions 18%

141 Statewide Inflationary and Austerity Impact "What if" FY02FY11 "What if" Funding Increase FTE 1,447,3321,643,202 Operations Funding $622,383,491$697,712,715$867,719,229$170,006,514 Per FTE $430$425$528 Transp. Funding $177,551,705$136,758,992$247,540,352$110,781,360 Per FTE $123$83$151 Austerity $0-$1,082,853,841$0$1,082,853,841 Federal Stimulus $0$126,169,757$0-$126,169,757 Increased FY11 funding if above adjustments were made $1,237,471,958 Actual Statewide Initial Allotment for FY11 $6,875,049,714 Percentage that QBE is underfunded by state's actions and inactions 18%

142 Statewide Inflationary and Austerity Impact "What if" FY02FY11 "What if" Funding Increase FTE 1,447,3321,643,202 Operations Funding $622,383,491$697,712,715$867,719,229$170,006,514 Per FTE $430$425$528 Transp. Funding $177,551,705$136,758,992$247,540,352$110,781,360 Per FTE $123$83$151 Austerity $0-$1,082,853,841$0$1,082,853,841 Federal Stimulus $0$126,169,757$0-$126,169,757 Increased FY11 funding if above adjustments were made $1,237,471,958 Actual Statewide Initial Allotment for FY11 $6,875,049,714 Percentage that QBE is underfunded by state's actions and inactions 18%

143 Statewide Inflationary and Austerity Impact "What if" FY02FY11 "What if" Funding Increase FTE 1,447,3321,643,202 Operations Funding $622,383,491$697,712,715$867,719,229$170,006,514 Per FTE $430$425$528 Transp. Funding $177,551,705$136,758,992$247,540,352$110,781,360 Per FTE $123$83$151 Austerity $0-$1,082,853,841$0$1,082,853,841 Federal Stimulus $0$126,169,757$0-$126,169,757 Increased FY11 funding if above adjustments were made $1,237,471,958 Actual Statewide Initial Allotment for FY11 $6,875,049,714 Percentage that QBE is underfunded by state's actions and inactions 18%

144 Statewide Inflationary and Austerity Impact "What if" FY02FY11 "What if" Funding Increase FTE 1,447,3321,643,202 Operations Funding $622,383,491$697,712,715$867,719,229$170,006,514 Per FTE $430$425$528 Transp. Funding $177,551,705$136,758,992$247,540,352$110,781,360 Per FTE $123$83$151 Austerity $0-$1,082,853,841$0$1,082,853,841 Federal Stimulus $0$126,169,757$0-$126,169,757 Increased FY11 funding if above adjustments were made $1,237,471,958 Actual Statewide Initial Allotment for FY11 $6,875,049,714 Percentage that QBE is underfunded by state's actions and inactions 18%

145 The impact on poor-wealth systems is significantly more than on systems benefitting from greater property wealth

146 Sample systems – Impact of Austerity and Inflation on Local Taxpayers FY11 WealthFundingEquivalent SystemRankShortfallMills Burke19$3,247,1791.99 Clayton83$35,721,6254.43 Cook155$2,534,1917.35 Dougherty123$12,331,7715.57 Emanuel168$3,693,0678.49 Haralson113$3,174,7125.57 Jenkins106$1,190,6265.82 Meriwether93$2,470,1064.55 Oglethorpe91$2,139,9895.08 Polk152$6,202,5836.53 Richmond103$24,442,6435.75 Sav-Chatham10$21,865,5311.80

147 Sample systems – Impact of Austerity and Inflation on Local Taxpayers FY11 WealthFundingEquivalent SystemRankShortfallMills Sav-Chatham10$21,865,5311.80 Burke19$3,247,1791.99 Clayton83$35,721,6254.43 Oglethorpe91$2,139,9895.08 Meriwether93$2,470,1064.55 Richmond103$24,442,6435.75 Jenkins106$1,190,6265.82 Haralson113$3,174,7125.57 Dougherty123$12,331,7715.57 Polk152$6,202,5836.53 Cook155$2,534,1917.35 Emanuel168$3,693,0678.49

148 The amount of funding earned according to the QBE formula is subject to several adjustments. Those adjustments include:

149 1) Local Fair Share (subtracted from the formula earnings 2) A transportation grant (added) 3) A sparcity grant (added to help small systems establish alternative schools) 4) An equalization grant (added); and 5) A nursing grant (added)

150 1) Local Fair Share (subtracted from the formula earnings 2) A transportation grant (added) 3) A sparcity grant (added to help small systems establish alternative schools) 4) An equalization grant (added); and 5) A nursing grant (added)

151 The QBE law specified that the funding of education was a shared responsibility between the state and local communities. Thus, after the QBE basic earnings are calculated, the state subtracts (or withholds) an amount equal to what five mills would generate in property taxes in each school system if property were accurately assessed at 40% of market value. Note that counties with greater property tax wealth have larger Local Fair Share deductions than do counties with smaller tax bases

152 The QBE law specified that the funding of education was a shared responsibility between the state and local communities. Thus, after the QBE basic earnings are calculated, the state subtracts (or withholds) an amount equal to what five mills would generate in property taxes in each school system if property were accurately assessed at 40% of market value. Note that counties with greater property tax wealth have larger Local Fair Share deductions than do counties with smaller tax bases

153 The QBE law specified that the funding of education was a shared responsibility between the state and local communities. Thus, after the QBE basic earnings are calculated, the state subtracts (or withholds) an amount equal to what five mills would generate in property taxes in each school system if property were accurately assessed at 40% of market value. Note that counties with greater property tax wealth have larger Local Fair Share deductions than do counties with smaller tax bases

154 QBE Minimum Funding State’s responsibility Local school system’s responsibility 5 mills

155 Communities who elected to provide more than a “quality basic” education for their children were allowed to contribute local revenues in excess of the five mills minimum requirement, up to a maximum of 20 mills of property tax.

156 QBE Minimum Funding State’s responsibility Local school system’s responsibility 5 mills Optional additional local funding, up to 20 mills Optional enhanced funding

157 Systems with greater property wealth generally pay a greater percentage of the QBE formula funding out of local tax revenues. How is this “fair”? The fairness comes from the fact that LFS essentially requires every property taxpayer to contribute five mills towards quality, basic education, whether the taxpayer is from a high wealth or a low wealth county. The “fairness” of this obligation stems from the fact act though “wealthier” systems pay a larger percent, the commitment on a per-taxpayer basis is 5 mills regardless of the land wealth

158 QBE Minimum Funding State’s responsibility Wealthier system’s responsibility 5 mills Optional additional local funding, up to 20 mills Optional enhanced funding

159 QBE Minimum Funding State’s responsibility Poorer system’s responsibility 5 mills Optional additional local funding, up to 20 mills Optional enhanced funding

160 Adjusting the Digest The state adjusts the digest before the state takes “its” five-mills share 1) each system’s digest is adjusted up to an equivalent 40% assessed digest; and 2) exemptions are adjusted to include only state-allowed exemptions

161 The Time Lag There is a 2-year lag between a digest and its impact on a system’s state funding

162 One system’s Local Fair Share and it’s associated Property Tax Digests

163 Formula vs. Actual Local Fair Share CalendarFiscalValue of Budget PctSales Year One Mill 5 millsYearLFSAdjustedRatio 2006FY07$328,885x5=$1,644,425FY09$1,775,7067.98%36.48% 2007FY08$348,561x5=$1,742,805 FY10 Formula $1,990,94214.24%33.71% FY10 Adjusted $1,811,242 2008FY09$359,175x5=$1,795,875 FY11 Formula $2,223,86823.83%30.82% FY11 Adjusted $1,889,233 2009FY10$392,209x5=$1,961,045 FY12 Formula $2,011,1382.55%38.69% 2009 FY12 Estimate $1,830,136

164 Formula vs. Actual Local Fair Share CalendarFiscalValue of Budget PctSales Year One Mill 5 millsYearLFSAdjustedRatio 2006FY07$328,885x5=$1,644,425FY09$1,775,7067.98%36.48% 2007FY08$348,561x5=$1,742,805 FY10 Formula $1,990,94214.24%33.71% FY10 Adjusted $1,811,242 2008FY09$359,175x5=$1,795,875 FY11 Formula $2,223,86823.83%30.82% FY11 Adjusted $1,889,233 2009FY10$392,209x5=$1,961,045 FY12 Formula $2,011,1382.55%38.69% 2009 FY12 Estimate $1,830,136

165 Formula vs. Actual Local Fair Share CalendarFiscalValue of Budget PctSales Year One Mill 5 millsYearLFSAdjustedRatio 2006FY07$328,885x5=$1,644,425FY09$1,775,7067.98%36.48% 2007FY08$348,561x5=$1,742,805 FY10 Formula $1,990,94214.24%33.71% FY10 Adjusted $1,811,242 2008FY09$359,175x5=$1,795,875 FY11 Formula $2,223,86823.83%30.82% FY11 Adjusted $1,889,233 2009FY10$392,209x5=$1,961,045 FY12 Formula $2,011,1382.55%38.69% 2009 FY12 Estimate $1,830,136

166 State law limits total statewide local fair share to no more than 20% of total statewide QBE earnings In FY10, local fair shares were 22% of QBE, so each system saved 2/22 or 9% on their local fair share assessments. This saved the county nearly $180,000 !!!

167 Formula vs. Actual Local Fair Share CalendarFiscalValue of Budget PctSales Year One Mill 5 millsYearLFSAdjustedRatio 2006FY07$328,885x5=$1,644,425FY09$1,775,7067.98%36.48% 2007FY08$348,561x5=$1,742,805 FY10 Formula $1,990,94214.24%33.71% FY10 Adjusted $1,811,242 2008FY09$359,175x5=$1,795,875 FY11 Formula $2,223,86823.83%30.82% FY11 Adjusted $1,889,233 2009FY10$392,209x5=$1,961,045 FY12 Formula $2,011,1382.55%38.69% 2009 FY12 Estimate $1,830,136

168 Formula vs. Actual Local Fair Share CalendarFiscalValue of Budget PctSales Year One Mill 5 millsYearLFSAdjustedRatio 2006FY07$328,885x5=$1,644,425FY09$1,775,7067.98%36.48% 2007FY08$348,561x5=$1,742,805 FY10 Formula $1,990,94214.24%33.71% FY10 Adjusted $1,811,242 2008FY09$359,175x5=$1,795,875 FY11 Formula $2,223,86823.83%30.82% FY11 Adjusted $1,889,233 2009FY10$392,209x5=$1,961,045 FY12 Formula $2,011,1382.55%38.69% 2009 FY12 Estimate $1,830,136

169 Formula vs. Actual Local Fair Share CalendarFiscalValue of Budget PctSales Year One Mill 5 millsYearLFSAdjustedRatio 2006FY07$328,885x5=$1,644,425FY09$1,775,7067.98%36.48% 2007FY08$348,561x5=$1,742,805 FY10 Formula $1,990,94214.24%33.71% FY10 Adjusted $1,811,242 2008FY09$359,175x5=$1,795,875 FY11 Formula $2,223,86823.83%30.82% FY11 Adjusted $1,889,233 2009FY10$392,209x5=$1,961,045 FY12 Formula $2,011,1382.55%38.69% 2009 FY12 Estimate $1,830,136

170 State law limits total statewide local fair share to no more than 20% of total statewide QBE earnings In FY11, local fair shares were 23% of QBE, so each system saved 3/23 or 15% on their local fair share assessments. This saved the county nearly $335,000!!!

171 Formula vs. Actual Local Fair Share CalendarFiscalValue of Budget PctSales Year One Mill 5 millsYearLFSAdjustedRatio 2006FY07$328,885x5=$1,644,425FY09$1,775,7067.98%36.48% 2007FY08$348,561x5=$1,742,805 FY10 Formula $1,990,94214.24%33.71% FY10 Adjusted $1,811,242 2008FY09$359,175x5=$1,795,875 FY11 Formula $2,223,86823.83%30.82% FY11 Adjusted $1,889,233 2009FY10$392,209x5=$1,961,045 FY12 Formula $2,011,1382.55%38.69% 2009 FY12 Estimate $1,830,136

172 Adjusted LFS

173 And next year? (FY12)

174 Formula vs. Actual Local Fair Share CalendarFiscalValue of Budget PctSales Year One Mill 5 millsYearLFSAdjustedRatio 2006FY07$328,885x5=$1,644,425FY09$1,775,7067.98%36.48% 2007FY08$348,561x5=$1,742,805 FY10 Formula $1,990,94214.24%33.71% FY10 Adjusted $1,811,242 2008FY09$359,175x5=$1,795,875 FY11 Formula $2,223,86823.83%30.82% FY11 Adjusted $1,889,233 2009FY10$392,209x5=$1,961,045 FY12 Formula $2,011,1382.55%38.69% 2009 FY12 Estimate $1,830,136

175 Formula vs. Actual Local Fair Share CalendarFiscalValue of Budget PctSales Year One Mill 5 millsYearLFSAdjustedRatio 2006FY07$328,885x5=$1,644,425FY09$1,775,7067.98%36.48% 2007FY08$348,561x5=$1,742,805 FY10 Formula $1,990,94214.24%33.71% FY10 Adjusted $1,811,242 2008FY09$359,175x5=$1,795,875 FY11 Formula $2,223,86823.83%30.82% FY11 Adjusted $1,889,233 2009FY10$392,209x5=$1,961,045 FY12 Formula $2,011,1382.55%38.69% 2009 FY12 Estimate $1,830,136

176 The FY12 budget will use the 2009 digests to determine local fair shares. With digests decreasing and QBE increasing (increased enrollment, increased benefit costs), it appears that Local Fair Shares in FY12 will be about 22% of QBE, meaning system will again pay about 4.55 mills towards local fair share The impact of this is that many systems, even with decreasing digests, will see their local fair share increase and systems with increasing digests will see significant increases in local fair share.

177 Formula vs. Actual Local Fair Share CalendarFiscalValue of Budget PctSales Year One Mill 5 millsYearLFSAdjustedRatio 2006FY07$328,885x5=$1,644,425FY09$1,775,7067.98%36.48% 2007FY08$348,561x5=$1,742,805 FY10 Formula $1,990,94214.24%33.71% FY10 Adjusted $1,811,242 2008FY09$359,175x5=$1,795,875 FY11 Formula $2,223,86823.83%30.82% FY11 Adjusted $1,889,233 2009FY10$392,209x5=$1,961,045 FY12 Formula $2,011,1382.55%38.69% 2009 FY12 Estimate $1,830,136

178 2008 to 2009 Digest Changes Adjust DigestAdjusted DigestPercent System20082009Change Burke$4,099,307,503$4,164,970,3031.60% Clayton$24,829,359,724$22,907,714,043-7.74% Cook$1,067,124,419$1,028,077,865-3.66% Dougherty$6,456,665,033$6,321,951,076-2.09% Emanuel$1,228,083,239$1,181,811,733-3.77% Haralson$1,731,957,223$1,529,224,390-11.71% Jenkins$659,687,364$586,210,367-11.14% Meriwether$1,633,550,162$1,603,392,895-1.85% Oglethorpe$1,207,136,773$1,240,827,3902.79% Polk$2,734,976,260$2,779,090,1561.61% Richmond$13,914,154,101$13,713,749,796-1.44% Sav-Chatham$37,017,837,522$37,992,916,9412.63%

179 1) Local Fair Share (subtracted from the formula earnings 2) A transportation grant (added) 3) A sparsity grant (added to help small systems establish alternative schools) 4) An equalization grant (added); and 5) A nursing grant (added)

180 The state has been aggressively cutting transportation grants to balance the state budget. In FY11, the state eliminated individual systems’ bus replacement funding and replaced it with a system of applying to the state for new bus funds when needed

181 Transportation grant

182 Bus replacement funding has been eliminated

183 1) Local Fair Share (subtracted from the formula earnings 2) A transportation grant (added) 3) A sparsity grant (added to help small systems establish alternative schools) 4) An equalization grant (added); and 5) A nursing grant (added)

184 Small systems and systems with small schools (“sparse populations”) used to receive small sparsity grants as a form of “rounding up” funding to adequately pay for some services such as alternative education and transportation. Grants were cut by about a third last year and were completely eliminated in FY11

185 Sparsity grants

186 1) Local Fair Share (subtracted from the formula earnings 2) A transportation grant (added) 3) A sparsity grant is (added to help small systems establish alternative schools) 4) An equalization grant (added); and 5) A nursing grant (added)

187 Equalization grants are intended to allow counties with lower property tax bases to fund education more comparably to “wealthier” counties. This has nothing to do with the wealth of citizens in the county, but rather the value of all property in the county and the number of students attending public schools

188 “Wealth Rankings” of Wealthiest Georgia School Systems in 2010-11 6 th ($399)

189 “Wealth Rankings” of Wealthiest Georgia School Systems in 2010-11 5 th ($447) 6th

190 “Wealth Rankings” of Wealthiest Georgia School Systems in 2010-11 5th 6th 4 th Atlanta ($449)

191 “Wealth Rankings” of Wealthiest Georgia School Systems in 2010-11 5 th 6 th 4 th Atlanta 3 rd ($588)

192 “Wealth Rankings” of Wealthiest Georgia School Systems in 2010-11 5 th 6 th 4 th Atlanta 3 rd 2 nd ($601)

193 “Wealth Rankings” of Wealthiest Georgia School Systems in 2010-11 5 th 6 th 4 th Atlanta 3 rd 2 nd 1 st ($666)

194 Top 25% of Georgia school districts In per-pupil local wealth

195 Bottom 25% of Georgia school districts In per-pupil local wealth

196 Systems under 12.5 mills in 2009

197 For each school system, the state calculates what one mill raises in property tax per student.

198 For each of the systems below that average, the state calculates the difference between that system and the average and give them that difference for every weighted FTE for every effective mill above the first five.

199 The formula: Equalization Grant = Weighted FTE x Wealth Difference x Effective Millage Rate -5

200 Funding Public Education in Georgia QBE Minimum Funding State’s responsibility Local school system’s responsibility Req’d Local Share Optional additional funding

201 Funding Public Education in Georgia QBE Minimum Funding State’s responsibility Local school system’s responsibility Req’d Local Share Optional additional funding Equalization is supposed to allow for this portion of education funding to be a minimum of the statewide average for this “additional” funding

202 How does equalization equalize? Assume two school systems, each with 1000 students and identical in FTE and T&E demographics, but one being the guaranteed system (75%ile) and the other a poorer system. Since their FTE is identical, their QBE earnings should be the same, let’s say $5,000,000 Assume the guaranteed system has a digest of $180 million ($180,000 per mill) and the poorer system has a digest of $100 million ($100,000 per mill), and each assesses 15 mills In guaranteed system the LFS will be 5 mills x $180,000 or $900,000 and in the poorer system it will be $500,000 Guaranteed system gets no equalization grant, and the poorer system gets $80 x 1000 students x 10 mills = $800,000 Guaranteed system gets, in local taxes, 15 mills x $180,000,000 = $2,700,000 and poorer system gets 15 x $100,000 = $1,500,000 Thus, total revenues = Guaranteed system Poorer system QBE$5,000,000$5,000,000 Less LFS - 900,000 - 500,000 Subtotal $4,100,000 $4,500,000

203 How does equalization equalize? Assume two school systems, each with 1000 students and identical in FTE and T&E demographics, but one being the guaranteed system (75%ile) and the other a poorer system. Since their FTE is identical, their QBE earnings should be the same, let’s say $5,000,000 Assume the guaranteed system has a digest of $180 million ($180,000 per mill) and the poorer system has a digest of $100 million ($100,000 per mill), and each assesses 15 mills In guaranteed system the LFS will be 5 mills x $180,000 or $900,000 and in the poorer system it will be $500,000 Guaranteed system gets no equalization grant, and the poorer system gets $80 x 1000 students x 10 mills = $800,000 Guaranteed system gets, in local taxes, 15 mills x $180,000,000 = $2,700,000 and poorer system gets 15 x $100,000 = $1,500,000 Thus, total revenues = Guaranteed system Poorer system QBE$5,000,000$5,000,000 Less LFS - 900,000 - 500,000 Subtotal $4,100,000 $4,500,000

204 How does equalization equalize? Assume two school systems, each with 1000 students and identical in FTE and T&E demographics, but one being the guaranteed system (75%ile) and the other a poorer system. Since their FTE is identical, their QBE earnings should be the same, let’s say $5,000,000 Assume the guaranteed system has a digest of $180 million ($180,000 per mill) and the poorer system has a digest of $100 million ($100,000 per mill), and each assesses 15 mills In guaranteed system the LFS will be 5 mills x $180,000 or $900,000 and in the poorer system it will be $500,000 Guaranteed system gets no equalization grant, and the poorer system gets $80 x 1000 students x 10 mills = $800,000 Guaranteed system gets, in local taxes, 15 mills x $180,000,000 = $2,700,000 and poorer system gets 15 x $100,000 = $1,500,000 Thus, total revenues = Guaranteed system Poorer system QBE$5,000,000$5,000,000 Less LFS - 900,000 - 500,000 Subtotal $4,100,000 $4,500,000

205 How does equalization equalize? Assume two school systems, each with 1000 students and identical in FTE and T&E demographics, but one being the guaranteed system (75%ile) and the other a poorer system. Since their FTE is identical, their QBE earnings should be the same, let’s say $5,000,000 Assume the guaranteed system has a digest of $180 million ($180,000 per mill) and the poorer system has a digest of $100 million ($100,000 per mill), and each assesses 15 mills In guaranteed system the LFS will be 5 mills x $180,000 or $900,000 and in the poorer system it will be $500,000 Guaranteed system gets no equalization grant, and the poorer system gets $80 x 1000 students x 10 mills = $800,000 Guaranteed system gets, in local taxes, 15 mills x $180,000,000 = $2,700,000 and poorer system gets 15 x $100,000 = $1,500,000 Thus, total revenues = Guaranteed system Poorer system QBE$5,000,000$5,000,000 Less LFS - 900,000 - 500,000 Subtotal $4,100,000 $4,500,000

206 How does equalization equalize? Assume two school systems, each with 1000 students and identical in FTE and T&E demographics, but one being the guaranteed system (75%ile) and the other a poorer system. Since their FTE is identical, their QBE earnings should be the same, let’s say $5,000,000 Assume the guaranteed system has a digest of $180 million ($180,000 per mill) and the poorer system has a digest of $100 million ($100,000 per mill), and each assesses 15 mills In guaranteed system the LFS will be 5 mills x $180,000 or $900,000 and in the poorer system it will be $500,000 Guaranteed system gets no equalization grant, and the poorer system gets $80 x 1000 students x 10 mills = $800,000 Guaranteed system gets, in local taxes, 15 mills x $180,000,000 = $2,700,000 and poorer system gets 15 x $100,000 = $1,500,000 Thus, total revenues = Guaranteed system Poorer system QBE$5,000,000$5,000,000 Less LFS - 900,000 - 500,000 Subtotal $4,100,000 $4,500,000

207 How does equalization equalize? Assume two school systems, each with 1000 students and identical in FTE and T&E demographics, but one being the guaranteed system (75%ile) and the other a poorer system. Since their FTE is identical, their QBE earnings should be the same, let’s say $5,000,000 Assume the guaranteed system has a digest of $180 million ($180,000 per mill) and the poorer system has a digest of $100 million ($100,000 per mill), and each assesses 15 mills In guaranteed system the LFS will be 5 mills x $180,000 or $900,000 and in the poorer system it will be $500,000 Guaranteed system gets, in local taxes, 15 mills x $180,000,000 = $2,700,000 and poorer system gets 15 x $100,000 = $1,500,000 Guaranteed system gets no equalization grant, and the poorer system gets $80 x 1000 students x 10 mills = $800,000 Thus, total revenues = Guaranteed system Poorer system QBE$5,000,000$5,000,000 Less LFS - 900,000 - 500,000 Subtotal $4,100,000 $4,500,000 Local taxes 2,700,000 1,500,000 Subtotal $6,800,000 $6,000,000

208 How does equalization equalize? Assume two school systems, each with 1000 students and identical in FTE and T&E demographics, but one being the guaranteed system (75%ile) and the other a poorer system. Since their FTE is identical, their QBE earnings should be the same, let’s say $5,000,000 Assume the guaranteed system has a digest of $180 million ($180,000 per mill) and the poorer system has a digest of $100 million ($100,000 per mill), and each assesses 15 mills In guaranteed system the LFS will be 5 mills x $180,000 or $900,000 and in the poorer system it will be $500,000 Guaranteed system gets, in local taxes, 15 mills x $180,000,000 = $2,700,000 and poorer system gets 15 x $100,000 = $1,500,000 Guaranteed system gets no equalization grant, and the poorer system gets $80 x 1000 students x 10 mills = $800,000 Thus, total revenues = Guaranteed system Poorer system QBE$5,000,000$5,000,000 Less LFS - 900,000 - 500,000 Subtotal $4,100,000 $4,500,000 Local taxes 2,700,000 1,500,000 Subtotal $6,800,000 $6,000,000

209 How does equalization equalize? Assume two school systems, each with 1000 students and identical in FTE and T&E demographics, but one being the guaranteed system (75%ile) and the other a poorer system. Since their FTE is identical, their QBE earnings should be the same, let’s say $5,000,000 Assume the guaranteed system has a digest of $180 million ($180,000 per mill) and the poorer system has a digest of $100 million ($100,000 per mill), and each assesses 15 mills In guaranteed system the LFS will be 5 mills x $180,000 or $900,000 and in the poorer system it will be $500,000 Guaranteed system gets, in local taxes, 15 mills x $180,000,000 = $2,700,000 and poorer system gets 15 x $100,000 = $1,500,000 Guaranteed system gets no equalization grant, and the poorer system gets $80 x 1000 students x 10 mills = $800,000 Thus, total revenues = Guaranteed system Poorer system QBE$5,000,000$5,000,000 Less LFS - 900,000 - 500,000 Subtotal $4,100,000 $4,500,000 Local taxes 2,700,000 1,500,000 Subtotal $6,800,000 $6,000,000 Equalization 0 800,000 Total funding $6,800,000 $6,800,000

210 The following table lists the calculated equalization grants for sample Georgia school systems

211 Calculated vs. Funded Equalization FY11 WealthCalculatedInitial FY11Equalization SystemRankEqualization Loss Sav-Chatham10$0 Burke19$0 Clayton83$27,253,573$17,960,563-$9,293,010 Oglethorpe91$1,725,114$1,136,879-$588,235 Meriwether93$1,698,140$1,119,103-$579,037 Richmond103$23,533,940$15,509,262-$8,024,678 Jenkins106$714,264$470,712-$243,552 Haralson113$2,841,412$1,872,538-$968,874 Dougherty123$14,504,374$9,558,626-$4,945,748 Polk152$7,650,526$5,041,825-$2,608,701 Cook155$3,404,125$2,243,375-$1,160,750 Emanuel168$4,761,812$3,138,114-$1,623,698

212 As one of the budget cutting moves in FY10, and again this year, the governor and legislature chose to reduce the amount of equalization grants to the 133 systems receiving those grants. This budget cutting move, which took money only from the poorest school systems in the state, recovered $225 million for the state coffers.

213 Calculated vs. Funded Equalization FY11 WealthCalculatedInitial FY11Equalization SystemRankEqualization Loss Sav-Chatham10$0 Burke19$0 Clayton83$27,253,573$17,960,563-$9,293,010 Oglethorpe91$1,725,114$1,136,879-$588,235 Meriwether93$1,698,140$1,119,103-$579,037 Richmond103$23,533,940$15,509,262-$8,024,678 Jenkins106$714,264$470,712-$243,552 Haralson113$2,841,412$1,872,538-$968,874 Dougherty123$14,504,374$9,558,626-$4,945,748 Polk152$7,650,526$5,041,825-$2,608,701 Cook155$3,404,125$2,243,375-$1,160,750 Emanuel168$4,761,812$3,138,114-$1,623,698

214 Note that in FY11, all systems gained funds from the state’s local fair share adjustment (20% cap). Since wealthy systems pay more in LFS than poorer systems, the adjustment benefited them disproportionately Only the poor systems lost from the equalization adjustment, poorer systems losing disproportionately more funding

215 Note that in FY11, all systems gained funds from the state’s local fair share adjustment (20% cap). Since wealthy systems pay more in LFS than poorer systems, the adjustment benefited them disproportionately Only the poor systems lost from the equalization adjustment, poorer systems losing disproportionately more funding

216 Note that in FY11, all systems gained funds from the state’s local fair share adjustment (20% cap). Since wealthy systems pay more in LFS than poorer systems, the adjustment benefited them disproportionately Only the poor systems lost from the equalization adjustment, poorer systems losing disproportionately more funding

217 The wealthiest system (1 st ) in the state saved $1,350,000 in LFS and lost no equalization (net gain = 0.75 mills) The middle (80 th ) system saved $99,000 in LFS and lost $91,500 in equalization (net gain =.06 mills) A poorer system (148 th in wealth) saved $345,000 in Local Fair Share (the 20% cap) but lost $1,090,000 in equalization funds (net loss = $745,000 or 1.97 mills) The poorest county system (178 th ) saved $47,800 in LFS but lost $700,000 in equalization (net loss = 10.6 mills)

218 The wealthiest system (1 st ) in the state saved $1,350,000 in LFS and lost no equalization (net gain = 0.75 mills) The middle (80 th ) system saved $99,000 in LFS and lost $91,500 in equalization (net gain =.06 mills) A poorer system (148 th in wealth) saved $345,000 in Local Fair Share (the 20% cap) but lost $1,090,000 in equalization funds (net loss = $745,000 or 1.97 mills) The poorest county system (178 th ) saved $47,800 in LFS but lost $700,000 in equalization (net loss = 10.6 mills)

219 The wealthiest system (1 st ) in the state saved $1,350,000 in LFS and lost no equalization (net gain = 0.75 mills) The middle (80 th ) system saved $99,000 in LFS and lost $91,500 in equalization (net gain =.06 mills) A poorer system (148 th in wealth) saved $345,000 in Local Fair Share (the 20% cap) but lost $1,090,000 in equalization funds (net loss = $745,000 or 1.97 mills) The poorest county system (178 th ) saved $47,800 in LFS but lost $700,000 in equalization (net loss = 10.6 mills)

220 The wealthiest system (1 st ) in the state saved $1,350,000 in LFS and lost no equalization (net gain = 0.75 mills) The middle (80 th ) system saved $99,000 in LFS and lost $91,500 in equalization (net gain =.06 mills) A poorer system (148 th in wealth) saved $345,000 in Local Fair Share (the 20% cap) but lost $1,090,000 in equalization funds (net loss = $745,000 or 1.97 mills) The poorest county system (178 th ) saved $47,800 in LFS but lost $700,000 in equalization (net loss = 10.6 mills)

221 Equalization grant

222 1) Local Fair Share (subtracted from the formula earnings 2) A transportation grant (added) 3) A sparsity grant (added to help small systems establish alternative schools) 4) An equalization grant (added); and 5) A nursing grant (added)

223 Leading up to the FY10 budget, the governor proposed that nursing grants for schools be eliminated. This having touched a sensitive nerve in various groups across the state (mostly parents and nurses), that recommendation was quickly withdrawn. Nursing grants are still in the budget, though at about 90% of their original amount

224 Nursing grant

225 Finally, no discussion of state funding would be complete without considering the impact of the governor’s austerity cuts.

226 Following the tragedies of September 11, 2001 and the stock market downturn, the national economy went into a recession and, with state revenues declining, the state began to withhold funds from school systems. In FY03, about 2% of QBE was withheld; in FY04, that increased to 4% and in FY05 and FY06 it was about 4.5%.

227 Statewide – History of Austerity Cuts FiscalAusterityFederalNet Austerity YearCutStimulusCut FY02$0 FY03$133,933,642$0$133,933,642 FY04$283,478,659$0$283,478,659 FY05$332,838,099$0$332,838,099 FY06$332,835,092$0$332,835,092 FY07$169,745,895$0$169,745,895 FY08$142,959,810$0$142,959,810 FY09$495,723,830$157,931,185$337,792,645 FY10$1,355,168,599$629,602,362$725,566,237 FY11$1,082,853,841$126,169,757$956,684,084 Total$4,329,537,467$913,703,304$3,415,834,163

228 As the national and state economies improved and state revenues returned to high levels, the austerity cuts became smaller, but the governor nevertheless continued to withhold funds from schools.

229 In FY07 and FY08, state revenues were at record levels, so high that the legislature approved millions of dollars for a fishing program in the state, $50 million for tax credits for private school donations, and millions more for special interest corporate tax breaks. Yet, the state continued to withhold funds from schools

230 Statewide – History of Austerity Cuts FiscalAusterityFederalNet Austerity YearCutStimulusCut FY02$0 FY03$133,933,642$0$133,933,642 FY04$283,478,659$0$283,478,659 FY05$332,838,099$0$332,838,099 FY06$332,835,092$0$332,835,092 FY07$169,745,895$0$169,745,895 FY08$142,959,810$0$142,959,810 FY09$495,723,830$157,931,185$337,792,645 FY10$1,355,168,599$629,602,362$725,566,237 FY11$1,082,853,841$126,169,757$956,684,084 Total$4,329,537,467$913,703,304$3,415,834,163 Record revenue years

231 With the economy now in another tailspin, the governor has added yet more austerity cuts to those still in place from before. In FY09, for example, public schoolchildren lost almost $338 million to these austerity cuts (after adjusting for federal stimulus funds); in FY10 that figure topped $725 million and in FY11, so far, it is more than $950 million

232 Statewide – History of Austerity Cuts FiscalAusterityFederalNet Austerity YearCutStimulusCut FY02$0 FY03$133,933,642$0$133,933,642 FY04$283,478,659$0$283,478,659 FY05$332,838,099$0$332,838,099 FY06$332,835,092$0$332,835,092 FY07$169,745,895$0$169,745,895 FY08$142,959,810$0$142,959,810 FY09$495,723,830$157,931,185$337,792,645 FY10$1,355,168,599$629,602,362$725,566,237 FY11$1,082,853,841$126,169,757$956,684,084 Total$4,329,537,467$913,703,304$3,415,834,163

233 Statewide – History of Austerity Cuts FiscalAusterityFederalNet Austerity YearCutStimulusCut FY02$0 FY03$133,933,642$0$133,933,642 FY04$283,478,659$0$283,478,659 FY05$332,838,099$0$332,838,099 FY06$332,835,092$0$332,835,092 FY07$169,745,895$0$169,745,895 FY08$142,959,810$0$142,959,810 FY09$495,723,830$157,931,185$337,792,645 FY10$1,355,168,599$629,602,362$725,566,237 FY11$1,082,853,841$126,169,757$956,684,084 Total$4,329,537,467$913,703,304$3,415,834,163

234 If the state has not been indexing much of educational funding to inflation and if the state has been, for nine years, withholding so much of QBE-earned money via austerity cuts, how have school systems survived financially over the past seven years?

235 The answer lies in the generation of local tax revenues

236 Sam ple School System Current 2010 Digest and Five Year History County School 2004200520062007200820092010 Real and Personal 722,027,113782,621,220878,418,2051,109,744,6171,191,891,7791,244,625,4401,261,082,821 Motor Vehicles 64,667,00063,404,33062,574,81069,819,20072,908,05072,965,78062,398,910 Moblie Homes 2,155,2081,979,2352,002,4451,924,8331,801,5761,784,1541,702,245 Timber 100% 41,79532,39349,11571,89239,520033,063 Heavy Duty Equipment 77,375164,9291,290,6652,809,2481,095,05238,4880 State Forest Assistance Grant Gross Digest 788,968,491848,202,107944,335,2401,184,369,7901,267,735,9771,319,413,8621,325,217,039 Less M&O Exceptions 95,711,876101,884,933106,991,591169,218,474178,099,201187,873,212196,500,747 Net M&O Digest 693,256,615746,317,174837,343,6491,015,151,3161,089,636,7761,131,540,6501,128,716,292 Gross M&O Millage 13.95 11.9512.90 Less Rollback 0000000 Net M&O Millage 13.95 11.9512.90 Net Taxes Levied 9,670,93010,411,12511,680,94412,131,05814,056,31414,596,87414,560,440 Net Taxes $ Increase/(Decrease) 1,416,313740,1951,269,819450,1141,925,256540,560-36,434 Net Taxes % Increase/(Decrease) 17.16%7.65%12.20%3.85%15.87%3.85%-0.25%

237 Sample School System Current 2010 Digest and Five Year History County School 2004200520062007200820092010 Real and Personal 722,027,113782,621,220878,418,2051,109,744,6171,191,891,7791,244,625,4401,261,082,821 Motor Vehicles 64,667,00063,404,33062,574,81069,819,20072,908,05072,965,78062,398,910 Moblie Homes 2,155,2081,979,2352,002,4451,924,8331,801,5761,784,1541,702,245 Timber 100% 41,79532,39349,11571,89239,520033,063 Heavy Duty Equipment 77,375164,9291,290,6652,809,2481,095,05238,4880 State Forest Assistance Grant Gross Digest 788,968,491848,202,107944,335,2401,184,369,7901,267,735,9771,319,413,8621,325,217,039 Less M&O Exceptions 95,711,876101,884,933106,991,591169,218,474178,099,201187,873,212196,500,747 Net M&O Digest 693,256,615746,317,174837,343,6491,015,151,3161,089,636,7761,131,540,6501,128,716,292 Gross M&O Millage 13.95 11.9512.90 Less Rollback 0000000 Net M&O Millage 13.95 11.9512.90 Net Taxes Levied 9,670,93010,411,12511,680,94412,131,05814,056,31414,596,87414,560,440 Net Taxes $ Increase/(Decrease) 1,416,313740,1951,269,819450,1141,925,256540,560-36,434 Net Taxes % Increase/(Decrease) 17.16%7.65%12.20%3.85%15.87%3.85%-0.25% d Assessed (40%) value of real estate and personal property

238 Sample School System Current 2010 Digest and Five Year History County School 2004200520062007200820092010 Real and Personal 722,027,113782,621,220878,418,2051,109,744,6171,191,891,7791,244,625,4401,261,082,821 Motor Vehicles 64,667,00063,404,33062,574,81069,819,20072,908,05072,965,78062,398,910 Moblie Homes 2,155,2081,979,2352,002,4451,924,8331,801,5761,784,1541,702,245 Timber 100% 41,79532,39349,11571,89239,520033,063 Heavy Duty Equipment 77,375164,9291,290,6652,809,2481,095,05238,4880 State Forest Assistance Grant Gross Digest 788,968,491848,202,107944,335,2401,184,369,7901,267,735,9771,319,413,8621,325,217,039 Less M&O Exceptions 95,711,876101,884,933106,991,591169,218,474178,099,201187,873,212196,500,747 Net M&O Digest 693,256,615746,317,174837,343,6491,015,151,3161,089,636,7761,131,540,6501,128,716,292 Gross M&O Millage 13.95 11.9512.90 Less Rollback 0000000 Net M&O Millage 13.95 11.9512.90 Net Taxes Levied 9,670,93010,411,12511,680,94412,131,05814,056,31414,596,87414,560,440 Net Taxes $ Increase/(Decrease) 1,416,313740,1951,269,819450,1141,925,256540,560-36,434 Net Taxes % Increase/(Decrease) 17.16%7.65%12.20%3.85%15.87%3.85%-0.25% d Assessed (40%) value of real estate and personal property Assessed value of all licensed motor vehicles

239 Sample School System Current 2010 Digest and Five Year History County School 2004200520062007200820092010 Real and Personal 722,027,113782,621,220878,418,2051,109,744,6171,191,891,7791,244,625,4401,261,082,821 Motor Vehicles 64,667,00063,404,33062,574,81069,819,20072,908,05072,965,78062,398,910 Moblie Homes 2,155,2081,979,2352,002,4451,924,8331,801,5761,784,1541,702,245 Timber 100% 41,79532,39349,11571,89239,520033,063 Heavy Duty Equipment 77,375164,9291,290,6652,809,2481,095,05238,4880 State Forest Assistance Grant Gross Digest 788,968,491848,202,107944,335,2401,184,369,7901,267,735,9771,319,413,8621,325,217,039 Less M&O Exceptions 95,711,876101,884,933106,991,591169,218,474178,099,201187,873,212196,500,747 Net M&O Digest 693,256,615746,317,174837,343,6491,015,151,3161,089,636,7761,131,540,6501,128,716,292 Gross M&O Millage 13.95 11.9512.90 Less Rollback 0000000 Net M&O Millage 13.95 11.9512.90 Net Taxes Levied 9,670,93010,411,12511,680,94412,131,05814,056,31414,596,87414,560,440 Net Taxes $ Increase/(Decrease) 1,416,313740,1951,269,819450,1141,925,256540,560-36,434 Net Taxes % Increase/(Decrease) 17.16%7.65%12.20%3.85%15.87%3.85%-0.25% d Assessed (40%) value of real estate and personal property Assessed value of all licensed motor vehicles Assessed value of all mobile homes

240 Sample School System Current 2010 Digest and Five Year History County School 2004200520062007200820092010 Real and Personal 722,027,113782,621,220878,418,2051,109,744,6171,191,891,7791,244,625,4401,261,082,821 Motor Vehicles 64,667,00063,404,33062,574,81069,819,20072,908,05072,965,78062,398,910 Moblie Homes 2,155,2081,979,2352,002,4451,924,8331,801,5761,784,1541,702,245 Timber 100% 41,79532,39349,11571,89239,520033,063 Heavy Duty Equipment 77,375164,9291,290,6652,809,2481,095,05238,4880 State Forest Assistance Grant Gross Digest 788,968,491848,202,107944,335,2401,184,369,7901,267,735,9771,319,413,8621,325,217,039 Less M&O Exceptions 95,711,876101,884,933106,991,591169,218,474178,099,201187,873,212196,500,747 Net M&O Digest 693,256,615746,317,174837,343,6491,015,151,3161,089,636,7761,131,540,6501,128,716,292 Gross M&O Millage 13.95 11.9512.90 Less Rollback 0000000 Net M&O Millage 13.95 11.9512.90 Net Taxes Levied 9,670,93010,411,12511,680,94412,131,05814,056,31414,596,87414,560,440 Net Taxes $ Increase/(Decrease) 1,416,313740,1951,269,819450,1141,925,256540,560-36,434 Net Taxes % Increase/(Decrease) 17.16%7.65%12.20%3.85%15.87%3.85%-0.25% d Assessed (40%) value of real estate and personal property Assessed value of all licensed motor vehicles Assessed value of all mobile homes 100% value of all timber harvested

241 Sample School System Current 2010 Digest and Five Year History County School 2004200520062007200820092010 Real and Personal 722,027,113782,621,220878,418,2051,109,744,6171,191,891,7791,244,625,4401,261,082,821 Motor Vehicles 64,667,00063,404,33062,574,81069,819,20072,908,05072,965,78062,398,910 Moblie Homes 2,155,2081,979,2352,002,4451,924,8331,801,5761,784,1541,702,245 Timber 100% 41,79532,39349,11571,89239,520033,063 Heavy Duty Equipment 77,375164,9291,290,6652,809,2481,095,05238,4880 State Forest Assistance Grant Gross Digest 788,968,491848,202,107944,335,2401,184,369,7901,267,735,9771,319,413,8621,325,217,039 Less M&O Exceptions 95,711,876101,884,933106,991,591169,218,474178,099,201187,873,212196,500,747 Net M&O Digest 693,256,615746,317,174837,343,6491,015,151,3161,089,636,7761,131,540,6501,128,716,292 Gross M&O Millage 13.95 11.9512.90 Less Rollback 0000000 Net M&O Millage 13.95 11.9512.90 Net Taxes Levied 9,670,93010,411,12511,680,94412,131,05814,056,31414,596,87414,560,440 Net Taxes $ Increase/(Decrease) 1,416,313740,1951,269,819450,1141,925,256540,560-36,434 Net Taxes % Increase/(Decrease) 17.16%7.65%12.20%3.85%15.87%3.85%-0.25% d Assessed (40%) value of real estate and personal property Assessed value of all licensed motor vehicles Assessed value of all mobile homes 100% value of all timber harvested Value of all unlicensed, mostly construction equipment

242 Sample School System Current 2010 Digest and Five Year History County School 2004200520062007200820092010 Real and Personal 722,027,113782,621,220878,418,2051,109,744,6171,191,891,7791,244,625,4401,261,082,821 Motor Vehicles 64,667,00063,404,33062,574,81069,819,20072,908,05072,965,78062,398,910 Moblie Homes 2,155,2081,979,2352,002,4451,924,8331,801,5761,784,1541,702,245 Timber 100% 41,79532,39349,11571,89239,520033,063 Heavy Duty Equipment 77,375164,9291,290,6652,809,2481,095,05238,4880 State Forest Assistance Grant Gross Digest 788,968,491848,202,107944,335,2401,184,369,7901,267,735,9771,319,413,8621,325,217,039 Less M&O Exceptions 95,711,876101,884,933106,991,591169,218,474178,099,201187,873,212196,500,747 Net M&O Digest 693,256,615746,317,174837,343,6491,015,151,3161,089,636,7761,131,540,6501,128,716,292 Gross M&O Millage 13.95 11.9512.90 Less Rollback 0000000 Net M&O Millage 13.95 11.9512.90 Net Taxes Levied 9,670,93010,411,12511,680,94412,131,05814,056,31414,596,87414,560,440 Net Taxes $ Increase/(Decrease) 1,416,313740,1951,269,819450,1141,925,256540,560-36,434 Net Taxes % Increase/(Decrease) 17.16%7.65%12.20%3.85%15.87%3.85%-0.25% d Assessed (40%) value of real estate and personal property Assessed value of all licensed motor vehicles Assessed value of all mobile homes 100% value of all timber harvested Value of all unlicensed, mostly construction equipment Total assessed value of all property

243 Sample School System Current 2010 Digest and Five Year History County School 2004200520062007200820092010 Real and Personal 722,027,113782,621,220878,418,2051,109,744,6171,191,891,7791,244,625,4401,261,082,821 Motor Vehicles 64,667,00063,404,33062,574,81069,819,20072,908,05072,965,78062,398,910 Moblie Homes 2,155,2081,979,2352,002,4451,924,8331,801,5761,784,1541,702,245 Timber 100% 41,79532,39349,11571,89239,520033,063 Heavy Duty Equipment 77,375164,9291,290,6652,809,2481,095,05238,4880 State Forest Assistance Grant Gross Digest 788,968,491848,202,107944,335,2401,184,369,7901,267,735,9771,319,413,8621,325,217,039 Less M&O Exceptions 95,711,876101,884,933106,991,591169,218,474178,099,201187,873,212196,500,747 Net M&O Digest 693,256,615746,317,174837,343,6491,015,151,3161,089,636,7761,131,540,6501,128,716,292 Gross M&O Millage 13.95 11.9512.90 Less Rollback 0000000 Net M&O Millage 13.95 11.9512.90 Net Taxes Levied 9,670,93010,411,12511,680,94412,131,05814,056,31414,596,87414,560,440 Net Taxes $ Increase/(Decrease) 1,416,313740,1951,269,819450,1141,925,256540,560-36,434 Net Taxes % Increase/(Decrease) 17.16%7.65%12.20%3.85%15.87%3.85%-0.25% d Assessed (40%) value of real estate and personal property Assessed value of all licensed motor vehicles Assessed value of all mobile homes 100% value of all timber harvested Value of all unlicensed, mostly construction equipment Total assessed value of all property Value of all exemptions (subtractions) from property digest

244 Sample School System Current 2010 Digest and Five Year History County School 2004200520062007200820092010 Real and Personal 722,027,113782,621,220878,418,2051,109,744,6171,191,891,7791,244,625,4401,261,082,821 Motor Vehicles 64,667,00063,404,33062,574,81069,819,20072,908,05072,965,78062,398,910 Moblie Homes 2,155,2081,979,2352,002,4451,924,8331,801,5761,784,1541,702,245 Timber 100% 41,79532,39349,11571,89239,520033,063 Heavy Duty Equipment 77,375164,9291,290,6652,809,2481,095,05238,4880 State Forest Assistance Grant Gross Digest 788,968,491848,202,107944,335,2401,184,369,7901,267,735,9771,319,413,8621,325,217,039 Less M&O Exceptions 95,711,876101,884,933106,991,591169,218,474178,099,201187,873,212196,500,747 Net M&O Digest 693,256,615746,317,174837,343,6491,015,151,3161,089,636,7761,131,540,6501,128,716,292 Gross M&O Millage 13.95 11.9512.90 Less Rollback 0000000 Net M&O Millage 13.95 11.9512.90 Net Taxes Levied 9,670,93010,411,12511,680,94412,131,05814,056,31414,596,87414,560,440 Net Taxes $ Increase/(Decrease) 1,416,313740,1951,269,819450,1141,925,256540,560-36,434 Net Taxes % Increase/(Decrease) 17.16%7.65%12.20%3.85%15.87%3.85%-0.25% d Assessed (40%) value of real estate and personal property Assessed value of all licensed motor vehicles Assessed value of all mobile homes 100% value of all timber harvested Value of all unlicensed, mostly construction equipment Total assessed value of all property Value of all exemptions (subtractions) from property digest Net value of taxable digest

245 Sample School System Current 2010 Digest and Five Year History County School 2004200520062007200820092010 Real and Personal 722,027,113782,621,220878,418,2051,109,744,6171,191,891,7791,244,625,4401,261,082,821 Motor Vehicles 64,667,00063,404,33062,574,81069,819,20072,908,05072,965,78062,398,910 Moblie Homes 2,155,2081,979,2352,002,4451,924,8331,801,5761,784,1541,702,245 Timber 100% 41,79532,39349,11571,89239,520033,063 Heavy Duty Equipment 77,375164,9291,290,6652,809,2481,095,05238,4880 State Forest Assistance Grant Gross Digest 788,968,491848,202,107944,335,2401,184,369,7901,267,735,9771,319,413,8621,325,217,039 Less M&O Exceptions 95,711,876101,884,933106,991,591169,218,474178,099,201187,873,212196,500,747 Net M&O Digest 693,256,615746,317,174837,343,6491,015,151,3161,089,636,7761,131,540,6501,128,716,292 Gross M&O Millage 13.95 11.9512.90 Less Rollback 0000000 Net M&O Millage 13.95 11.9512.90 Net Taxes Levied 9,670,93010,411,12511,680,94412,131,05814,056,31414,596,87414,560,440 Net Taxes $ Increase/(Decrease) 1,416,313740,1951,269,819450,1141,925,256540,560-36,434 Net Taxes % Increase/(Decrease) 17.16%7.65%12.20%3.85%15.87%3.85%-0.25% d Assessed (40%) value of real estate and personal property Assessed value of all licensed motor vehicles Assessed value of all mobile homes 100% value of all timber harvested Value of all unlicensed, mostly construction equipment Total assessed value of all property Value of all exemptions (subtractions) from property digest Net value of taxable digest One mill generates 1/1000 th of this amount

246 Sample School System Current 2010 Digest and Five Year History County School 2004200520062007200820092010 Real and Personal 722,027,113782,621,220878,418,2051,109,744,6171,191,891,7791,244,625,4401,261,082,821 Motor Vehicles 64,667,00063,404,33062,574,81069,819,20072,908,05072,965,78062,398,910 Moblie Homes 2,155,2081,979,2352,002,4451,924,8331,801,5761,784,1541,702,245 Timber 100% 41,79532,39349,11571,89239,520033,063 Heavy Duty Equipment 77,375164,9291,290,6652,809,2481,095,05238,4880 State Forest Assistance Grant Gross Digest 788,968,491848,202,107944,335,2401,184,369,7901,267,735,9771,319,413,8621,325,217,039 Less M&O Exceptions 95,711,876101,884,933106,991,591169,218,474178,099,201187,873,212196,500,747 Net M&O Digest 693,256,615746,317,174837,343,6491,015,151,3161,089,636,7761,131,540,6501,128,716,292 Gross M&O Millage 13.95 11.9512.90 Less Rollback 0000000 Net M&O Millage 13.95 11.9512.90 Net Taxes Levied 9,670,93010,411,12511,680,94412,131,05814,056,31414,596,87414,560,440 Net Taxes $ Increase/(Decrease) 1,416,313740,1951,269,819450,1141,925,256540,560-36,434 Net Taxes % Increase/(Decrease) 17.16%7.65%12.20%3.85%15.87%3.85%-0.25% d Assessed (40%) value of real estate and personal property Assessed value of all licensed motor vehicles Assessed value of all mobile homes 100% value of all timber harvested Value of all unlicensed, mostly construction equipment Total assessed value of all property Value of all exemptions (subtractions) from property digest Net value of taxable digest One mill generates 1/1000 th of this amount

247 Sample School System Current 2010 Digest and Five Year History County School 2004200520062007200820092010 Real and Personal 722,027,113782,621,220878,418,2051,109,744,6171,191,891,7791,244,625,4401,261,082,821 Motor Vehicles 64,667,00063,404,33062,574,81069,819,20072,908,05072,965,78062,398,910 Moblie Homes 2,155,2081,979,2352,002,4451,924,8331,801,5761,784,1541,702,245 Timber 100% 41,79532,39349,11571,89239,520033,063 Heavy Duty Equipment 77,375164,9291,290,6652,809,2481,095,05238,4880 State Forest Assistance Grant Gross Digest 788,968,491848,202,107944,335,2401,184,369,7901,267,735,9771,319,413,8621,325,217,039 Less M&O Exceptions 95,711,876101,884,933106,991,591169,218,474178,099,201187,873,212196,500,747 Net M&O Digest 693,256,615746,317,174837,343,6491,015,151,3161,089,636,7761,131,540,6501,128,716,292 Gross M&O Millage 13.95 11.9512.90 Less Rollback 0000000 Net M&O Millage 13.95 11.9512.90 Net Taxes Levied 9,670,93010,411,12511,680,94412,131,05814,056,31414,596,87414,560,440 Net Taxes $ Increase/(Decrease) 1,416,313740,1951,269,819450,1141,925,256540,560-36,434 Net Taxes % Increase/(Decrease) 17.16%7.65%12.20%3.85%15.87%3.85%-0.25% d Assessed (40%) value of real estate and personal property Assessed value of all licensed motor vehicles Assessed value of all mobile homes 100% value of all timber harvested Value of all unlicensed, mostly construction equipment Total assessed value of all property Value of all exemptions (subtractions) from property digest Net value of taxable digest Millage rate assessed by the BOE

248 Sample School System Current 2010 Digest and Five Year History County School 2004200520062007200820092010 Real and Personal 722,027,113782,621,220878,418,2051,109,744,6171,191,891,7791,244,625,4401,261,082,821 Motor Vehicles 64,667,00063,404,33062,574,81069,819,20072,908,05072,965,78062,398,910 Moblie Homes 2,155,2081,979,2352,002,4451,924,8331,801,5761,784,1541,702,245 Timber 100% 41,79532,39349,11571,89239,520033,063 Heavy Duty Equipment 77,375164,9291,290,6652,809,2481,095,05238,4880 State Forest Assistance Grant Gross Digest 788,968,491848,202,107944,335,2401,184,369,7901,267,735,9771,319,413,8621,325,217,039 Less M&O Exceptions 95,711,876101,884,933106,991,591169,218,474178,099,201187,873,212196,500,747 Net M&O Digest 693,256,615746,317,174837,343,6491,015,151,3161,089,636,7761,131,540,6501,128,716,292 Gross M&O Millage 13.95 11.9512.90 Less Rollback 0000000 Net M&O Millage 13.95 11.9512.90 Net Taxes Levied 9,670,93010,411,12511,680,94412,131,05814,056,31414,596,87414,560,440 Net Taxes $ Increase/(Decrease) 1,416,313740,1951,269,819450,1141,925,256540,560-36,434 Net Taxes % Increase/(Decrease) 17.16%7.65%12.20%3.85%15.87%3.85%-0.25% d Assessed (40%) value of real estate and personal property Assessed value of all licensed motor vehicles Assessed value of all mobile homes 100% value of all timber harvested Value of all unlicensed, mostly construction equipment Total assessed value of all property Value of all exemptions (subtractions) from property digest Net value of taxable digest Millage rate assessed by the BOE Total local property taxes levied

249 Sample School System Current 2010 Digest and Five Year History County School 2004200520062007200820092010 Real and Personal 722,027,113782,621,220878,418,2051,109,744,6171,191,891,7791,244,625,4401,261,082,821 Motor Vehicles 64,667,00063,404,33062,574,81069,819,20072,908,05072,965,78062,398,910 Moblie Homes 2,155,2081,979,2352,002,4451,924,8331,801,5761,784,1541,702,245 Timber 100% 41,79532,39349,11571,89239,520033,063 Heavy Duty Equipment 77,375164,9291,290,6652,809,2481,095,05238,4880 State Forest Assistance Grant Gross Digest 788,968,491848,202,107944,335,2401,184,369,7901,267,735,9771,319,413,8621,325,217,039 Less M&O Exceptions 95,711,876101,884,933106,991,591169,218,474178,099,201187,873,212196,500,747 Net M&O Digest 693,256,615746,317,174837,343,6491,015,151,3161,089,636,7761,131,540,6501,128,716,292 Gross M&O Millage 13.95 11.9512.90 Less Rollback 0000000 Net M&O Millage 13.95 11.9512.90 Net Taxes Levied 9,670,93010,411,12511,680,94412,131,05814,056,31414,596,87414,560,440 Net Taxes $ Increase/(Decrease) 1,416,313740,1951,269,819450,1141,925,256540,560-36,434 Net Taxes % Increase/(Decrease) 17.16%7.65%12.20%3.85%15.87%3.85%-0.25% d Assessed (40%) value of real estate and personal property Assessed value of all licensed motor vehicles Assessed value of all mobile homes 100% value of all timber harvested Value of all unlicensed, mostly construction equipment Total assessed value of all property Value of all exemptions (subtractions) from property digest Net value of taxable digest Millage rate assessed by the BOE Total local property taxes levied Changes from previous year

250 During the short economic recession which began in 2002, the federal reserve bank dropped interest rates precipitously. This drop led to a nationwide rush to buy housing (both to live in and for investment and speculation) which, in turn, led to a rapid increase in real estate values

251 That increase in property values increased the digests of virtually every school system in the state of Georgia just at the time that the state became more aggressive in cutting public school funding. Thus, systems were able to balance their budgets because of the increase in locally generated property tax revenues

252 In essence, the state has been transferring more and more responsibility for public school funding from the state to local governments.

253 TAX20032004200520062007200820092010 Real & Personal2,721,949,5712,932,228,4613,408,081,6673,821,013,0584,361,404,5414,587,766,6824,558,271,4063,880,139,370 Motor Vehicles259,880,460261,590,540259,762,850255,953,120280,208,040297,451,900313,853,320270,103,530 Mobile Homes7,831,9409,192,4118,428,83310,394,0349,631,5299,127,7838,809,8247,601,654 Timber - 100%216,807283,99498,921223,521339,233527,287143,420339,100 Heavy Duty Equipment75,345345,712331,322508,638428,97255,969285,28946,586 Gross Digest2,989,954,1233,203,641,1183,676,703,5934,088,092,3714,652,012,3154,894,929,6214,881,363,2594,158,230,240 Less M& O Exemptions333,397,514352,012,515447,841,621536,862,578639,950,918701,915,351738,025,071657,092,549 Net M & O Digest2,656,556,6092,851,628,6033,228,861,9723,551,229,7934,012,061,3974,193,014,2704,143,338,1883,501,137,691 Gross M&O Millage19.767 19.48419.400 18.70018.35020.000 Less Rollbacks0.0000.2831.0840.0000.7000.3500.000 Net M&O Millage19.76719.48418.40019.40018.70018.350 20.000 Total School Taxes Levied$52,512,154$55,561,132$59,411,060$68,893,858$75,025,548$76,941,812$76,030,256$70,022,754 Net Taxes $ Increase $3,048,977$3,849,929$9,482,798$6,131,690$1,916,264-$911,556-$6,007,502 Net Taxes % Increase 5.81%6.93%15.96%8.90%2.55%-1.18%-7.90%. Property +68.5%

254 TAX20032004200520062007200820092010 Real & Personal2,721,949,5712,932,228,4613,408,081,6673,821,013,0584,361,404,5414,587,766,6824,558,271,4063,880,139,370 Motor Vehicles259,880,460261,590,540259,762,850255,953,120280,208,040297,451,900313,853,320270,103,530 Mobile Homes7,831,9409,192,4118,428,83310,394,0349,631,5299,127,7838,809,8247,601,654 Timber - 100%216,807283,99498,921223,521339,233527,287143,420339,100 Heavy Duty Equipment75,345345,712331,322508,638428,97255,969285,28946,586 Gross Digest2,989,954,1233,203,641,1183,676,703,5934,088,092,3714,652,012,3154,894,929,6214,881,363,2594,158,230,240 Less M& O Exemptions333,397,514352,012,515447,841,621536,862,578639,950,918701,915,351738,025,071657,092,549 Net M & O Digest2,656,556,6092,851,628,6033,228,861,9723,551,229,7934,012,061,3974,193,014,2704,143,338,1883,501,137,691 Gross M&O Millage19.767 19.48419.400 18.70018.35020.000 Less Rollbacks0.0000.2831.0840.0000.7000.3500.000 Net M&O Millage19.76719.48418.40019.40018.70018.350 20.000 Total School Taxes Levied$52,512,154$55,561,132$59,411,060$68,893,858$75,025,548$76,941,812$76,030,256$70,022,754 Net Taxes $ Increase $3,048,977$3,849,929$9,482,798$6,131,690$1,916,264-$911,556-$6,007,502 Net Taxes % Increase 5.81%6.93%15.96%8.90%2.55%-1.18%-7.90%. Property +68.5% Net Digest +58%

255 TAX20032004200520062007200820092010 Real & Personal2,721,949,5712,932,228,4613,408,081,6673,821,013,0584,361,404,5414,587,766,6824,558,271,4063,880,139,370 Motor Vehicles259,880,460261,590,540259,762,850255,953,120280,208,040297,451,900313,853,320270,103,530 Mobile Homes7,831,9409,192,4118,428,83310,394,0349,631,5299,127,7838,809,8247,601,654 Timber - 100%216,807283,99498,921223,521339,233527,287143,420339,100 Heavy Duty Equipment75,345345,712331,322508,638428,97255,969285,28946,586 Gross Digest2,989,954,1233,203,641,1183,676,703,5934,088,092,3714,652,012,3154,894,929,6214,881,363,2594,158,230,240 Less M& O Exemptions333,397,514352,012,515447,841,621536,862,578639,950,918701,915,351738,025,071657,092,549 Net M & O Digest2,656,556,6092,851,628,6033,228,861,9723,551,229,7934,012,061,3974,193,014,2704,143,338,1883,501,137,691 Gross M&O Millage19.767 19.48419.400 18.70018.35020.000 Less Rollbacks0.0000.2831.0840.0000.7000.3500.000 Net M&O Millage19.76719.48418.40019.40018.70018.350 20.000 Total School Taxes Levied$52,512,154$55,561,132$59,411,060$68,893,858$75,025,548$76,941,812$76,030,256$70,022,754 Net Taxes $ Increase $3,048,977$3,849,929$9,482,798$6,131,690$1,916,264-$911,556-$6,007,502 Net Taxes % Increase 5.81%6.93%15.96%8.90%2.55%-1.18%-7.90%. Property +68.5% Net Digest +58% Even with a 1.4 mill decrease….

256 TAX20032004200520062007200820092010 Real & Personal2,721,949,5712,932,228,4613,408,081,6673,821,013,0584,361,404,5414,587,766,6824,558,271,4063,880,139,370 Motor Vehicles259,880,460261,590,540259,762,850255,953,120280,208,040297,451,900313,853,320270,103,530 Mobile Homes7,831,9409,192,4118,428,83310,394,0349,631,5299,127,7838,809,8247,601,654 Timber - 100%216,807283,99498,921223,521339,233527,287143,420339,100 Heavy Duty Equipment75,345345,712331,322508,638428,97255,969285,28946,586 Gross Digest2,989,954,1233,203,641,1183,676,703,5934,088,092,3714,652,012,3154,894,929,6214,881,363,2594,158,230,240 Less M& O Exemptions333,397,514352,012,515447,841,621536,862,578639,950,918701,915,351738,025,071657,092,549 Net M & O Digest2,656,556,6092,851,628,6033,228,861,9723,551,229,7934,012,061,3974,193,014,2704,143,338,1883,501,137,691 Gross M&O Millage19.767 19.48419.400 18.70018.35020.000 Less Rollbacks0.0000.2831.0840.0000.7000.3500.000 Net M&O Millage19.76719.48418.40019.40018.70018.350 20.000 Total School Taxes Levied$52,512,154$55,561,132$59,411,060$68,893,858$75,025,548$76,941,812$76,030,256$70,022,754 Net Taxes $ Increase $3,048,977$3,849,929$9,482,798$6,131,690$1,916,264-$911,556-$6,007,502 Net Taxes % Increase 5.81%6.93%15.96%8.90%2.55%-1.18%-7.90%. Property +68.5% Net Digest +58% Even with a 1.4 mill decrease…. Taxes were up over 46%

257 As fast as the state leadership took money away from schools, the local taxpayer filled in the “hole”…. and in most systems, even enlarged the total pot And suddenly the party ended…

258 As fast as the state leadership took money away from schools, the local taxpayer filled in the “hole”…. and in most systems, even enlarged the total pot And suddenly the party ended…

259 TAX20032004200520062007200820092010 Real & Personal2,721,949,5712,932,228,4613,408,081,6673,821,013,0584,361,404,5414,587,766,6824,558,271,4063,880,139,370 Motor Vehicles259,880,460261,590,540259,762,850255,953,120280,208,040297,451,900313,853,320270,103,530 Mobile Homes7,831,9409,192,4118,428,83310,394,0349,631,5299,127,7838,809,8247,601,654 Timber - 100%216,807283,99498,921223,521339,233527,287143,420339,100 Heavy Duty Equipment75,345345,712331,322508,638428,97255,969285,28946,586 Gross Digest2,989,954,1233,203,641,1183,676,703,5934,088,092,3714,652,012,3154,894,929,6214,881,363,2594,158,230,240 Less M& O Exemptions333,397,514352,012,515447,841,621536,862,578639,950,918701,915,351738,025,071657,092,549 Net M & O Digest2,656,556,6092,851,628,6033,228,861,9723,551,229,7934,012,061,3974,193,014,2704,143,338,1883,501,137,691 Gross M&O Millage19.767 19.48419.400 18.70018.35020.000 Less Rollbacks0.0000.2831.0840.0000.7000.3500.000 Net M&O Millage19.76719.48418.40019.40018.70018.350 20.000 Total School Taxes Levied$52,512,154$55,561,132$59,411,060$68,893,858$75,025,548$76,941,812$76,030,256$70,022,754 Net Taxes $ Increase $3,048,977$3,849,929$9,482,798$6,131,690$1,916,264-$911,556-$6,007,502 Net Taxes % Increase 5.81%6.93%15.96%8.90%2.55%-1.18%-7.90%. Property down 15%

260 TAX20032004200520062007200820092010 Real & Personal2,721,949,5712,932,228,4613,408,081,6673,821,013,0584,361,404,5414,587,766,6824,558,271,4063,880,139,370 Motor Vehicles259,880,460261,590,540259,762,850255,953,120280,208,040297,451,900313,853,320270,103,530 Mobile Homes7,831,9409,192,4118,428,83310,394,0349,631,5299,127,7838,809,8247,601,654 Timber - 100%216,807283,99498,921223,521339,233527,287143,420339,100 Heavy Duty Equipment75,345345,712331,322508,638428,97255,969285,28946,586 Gross Digest2,989,954,1233,203,641,1183,676,703,5934,088,092,3714,652,012,3154,894,929,6214,881,363,2594,158,230,240 Less M& O Exemptions333,397,514352,012,515447,841,621536,862,578639,950,918701,915,351738,025,071657,092,549 Net M & O Digest2,656,556,6092,851,628,6033,228,861,9723,551,229,7934,012,061,3974,193,014,2704,143,338,1883,501,137,691 Gross M&O Millage19.767 19.48419.400 18.70018.35020.000 Less Rollbacks0.0000.2831.0840.0000.7000.3500.000 Net M&O Millage19.76719.48418.40019.40018.70018.350 20.000 Total School Taxes Levied$52,512,154$55,561,132$59,411,060$68,893,858$75,025,548$76,941,812$76,030,256$70,022,754 Net Taxes $ Increase $3,048,977$3,849,929$9,482,798$6,131,690$1,916,264-$911,556-$6,007,502 Net Taxes % Increase 5.81%6.93%15.96%8.90%2.55%-1.18%-7.90%. Property down 15% Net digest down 16.5%

261 TAX20032004200520062007200820092010 Real & Personal2,721,949,5712,932,228,4613,408,081,6673,821,013,0584,361,404,5414,587,766,6824,558,271,4063,880,139,370 Motor Vehicles259,880,460261,590,540259,762,850255,953,120280,208,040297,451,900313,853,320270,103,530 Mobile Homes7,831,9409,192,4118,428,83310,394,0349,631,5299,127,7838,809,8247,601,654 Timber - 100%216,807283,99498,921223,521339,233527,287143,420339,100 Heavy Duty Equipment75,345345,712331,322508,638428,97255,969285,28946,586 Gross Digest2,989,954,1233,203,641,1183,676,703,5934,088,092,3714,652,012,3154,894,929,6214,881,363,2594,158,230,240 Less M& O Exemptions333,397,514352,012,515447,841,621536,862,578639,950,918701,915,351738,025,071657,092,549 Net M & O Digest2,656,556,6092,851,628,6033,228,861,9723,551,229,7934,012,061,3974,193,014,2704,143,338,1883,501,137,691 Gross M&O Millage19.767 19.48419.400 18.70018.35020.000 Less Rollbacks0.0000.2831.0840.0000.7000.3500.000 Net M&O Millage19.76719.48418.40019.40018.70018.350 20.000 Total School Taxes Levied$52,512,154$55,561,132$59,411,060$68,893,858$75,025,548$76,941,812$76,030,256$70,022,754 Net Taxes $ Increase $3,048,977$3,849,929$9,482,798$6,131,690$1,916,264-$911,556-$6,007,502 Net Taxes % Increase 5.81%6.93%15.96%8.90%2.55%-1.18%-7.90%. Property down 15% Net digest down 16.5% Even with the millage rate maxed at 20 mills

262 TAX20032004200520062007200820092010 Real & Personal2,721,949,5712,932,228,4613,408,081,6673,821,013,0584,361,404,5414,587,766,6824,558,271,4063,880,139,370 Motor Vehicles259,880,460261,590,540259,762,850255,953,120280,208,040297,451,900313,853,320270,103,530 Mobile Homes7,831,9409,192,4118,428,83310,394,0349,631,5299,127,7838,809,8247,601,654 Timber - 100%216,807283,99498,921223,521339,233527,287143,420339,100 Heavy Duty Equipment75,345345,712331,322508,638428,97255,969285,28946,586 Gross Digest2,989,954,1233,203,641,1183,676,703,5934,088,092,3714,652,012,3154,894,929,6214,881,363,2594,158,230,240 Less M& O Exemptions333,397,514352,012,515447,841,621536,862,578639,950,918701,915,351738,025,071657,092,549 Net M & O Digest2,656,556,6092,851,628,6033,228,861,9723,551,229,7934,012,061,3974,193,014,2704,143,338,1883,501,137,691 Gross M&O Millage19.767 19.48419.400 18.70018.35020.000 Less Rollbacks0.0000.2831.0840.0000.7000.3500.000 Net M&O Millage19.76719.48418.40019.40018.70018.350 20.000 Total School Taxes Levied$52,512,154$55,561,132$59,411,060$68,893,858$75,025,548$76,941,812$76,030,256$70,022,754 Net Taxes $ Increase $3,048,977$3,849,929$9,482,798$6,131,690$1,916,264-$911,556-$6,007,502 Net Taxes % Increase 5.81%6.93%15.96%8.90%2.55%-1.18%-7.90%. Property down 15% Net digest down 16.5% Even with the millage rate maxed at 20 mills Local tax revenues are down 9%

263 History of Sources of Funding Local State Federal Total FTE Per StudentPct Per StudentPct Per StudentPct Per Student FY02 State 1,447,332 $2,75238.4%$4,01056.0%$4045.6%$7,165 FY09 State 1,625,405 $3,88443.7%$4,31848.6%$6867.7%$8,888

264 And the other sources of local income?

265 A small amount of local funding also comes from Real Estate Transfer Taxes Recording Intangibles Interest on “Investments” Miscellaneous Sources

266 A small amount of local funding also comes from Real Estate Transfer Taxes (decreasing) Recording Intangibles Interest on “Investments” Miscellaneous Sources

267 A small amount of local funding also comes from Real Estate Transfer Taxes (decreasing) Recording Intangibles (decreasing) Interest on “Investments” Miscellaneous Sources

268 A small amount of local funding also comes from Real Estate Transfer Taxes (decreasing) Recording Intangibles (decreasing) Interest on “Investments” (decreasing) Miscellaneous Sources

269 A small amount of local funding also comes from Real Estate Transfer Taxes (decreasing) Recording Intangibles (decreasing) Interest on “Investments” (decreasing) Miscellaneous Sources (decreasing)

270 As a result of the severe state budget cuts, most systems in the state faced two unpleasant alternatives coming into the 2010-11 school year, and will likely face the same in FY12

271 1)Alternative 1 is to raise millage rates, which is particularly difficult during a time when families are struggling with their own finances; and 2)Alternative 2 is to further cut personnel and programs so as to decrease the expenditure side of the ledger, which is equally as unpleasant since many systems have already suffered drastic personnel and program cutbacks

272 1)Alternative 1 is to raise millage rates, which is particularly difficult during a time when families are struggling with their own finances; and 2)Alternative 2 is to further cut personnel and programs so as to decrease the expenditure side of the ledger, which is equally as unpleasant since many systems have already suffered drastic personnel and program cutbacks

273 But a third alternative, which has the potential to decrease the size of the first two alternatives, is to work diligently in an attempt to make the very best use of the decreasing resources available in coming years.

274 At the risk of being presumptuous, it would be my recommendation that school systems 1) re-examine their budget processes currently in place to determine if they make the most instructionally effective use of diminished and diminishing resources; and 2)at the same time, encourage all school administrators – both centrally based and school based - to talk to legislators, citizens, teachers, and parents on the causes and nature of the problems facing your systems and public education across the state of Georgia.

275 At the risk of being presumptuous, it would be my recommendation that school systems 1) re-examine their budget processes currently in place to determine if they make the most instructionally effective use of diminished and diminishing resources; and 2)at the same time, encourage all school administrators – both centrally based and school based - to talk to legislators, citizens, teachers, and parents on the causes and nature of the problems facing your systems and public education across the state of Georgia.

276 Political/Financial Implications (in no particular order) Federal funding will disappear in FY12, though some systems will have “residuals” from the latest jobs bill funding Legislators have expressed their desire to make replenishing the state operating reserve one of their top priorities when revenues increase With the governor having depleted the health care operating reserve in order to balance the budget in FY10 (and in FY11), that avenue is no longer available as a financial “tool” to avoid further cutting expenditures The budget is based upon FY11 state taxes and fees increasing by 4.2% over FY10 amended budget figures

277 Political/Financial Implications (in no particular order) Federal funding will disappear in FY12, though some systems will have “residuals” from the latest jobs bill funding Legislators have expressed their desire to make replenishing the state operating reserve one of their top priorities when revenues increase With the governor having depleted the health care operating reserve in order to balance the budget in FY10 (and in FY11), that avenue is no longer available as a financial “tool” to avoid further cutting expenditures The budget is based upon FY11 state taxes and fees increasing by 4.2% over FY10 amended budget figures

278 Political/Financial Implications (in no particular order) Federal funding will disappear in FY12, though some systems will have “residuals” from the latest jobs bill funding Legislators have expressed their desire to make replenishing the state operating reserve one of their top priorities when revenues increase With the governor having depleted the health care operating reserve in order to balance the budget in FY10 (and in FY11), that avenue is no longer available as a financial “tool” to avoid further cutting expenditures The budget is based upon FY11 state taxes and fees increasing by 4.2% over FY10 amended budget figures

279 Political/Financial Implications (in no particular order) Federal funding will disappear in FY12, though some systems will have “residuals” from the latest jobs bill funding Legislators have expressed their desire to make replenishing the state operating reserve one of their top priorities when revenues increase With the governor having depleted the health care operating reserve in order to balance the budget in FY10 (and in FY11), that avenue is no longer available as a financial “tool” to avoid further cutting expenditures The budget is based upon FY11 state taxes and fees increasing by 4.2% over FY10 amended budget figures

280 Political/Financial Implications (in no particular order) Although a recent poll indicated that approximately 60% of Georgia taxpayers are willing to pay higher taxes in order to maintain quality education, state leadership has not indicated any willingness to address education shortfalls via taxation and the poll results seem to contradict the general sentiment (evidenced by anti-tax sentiment) to cut taxes, not raise taxes The housing market does not seem to be rebounding yet and, in fact, foreclosures are continuing to increase meaning that digests are not likely to increase in the near future and may well decrease some more

281 Political/Financial Implications (in no particular order) Although a recent poll indicated that approximately 60% of Georgia taxpayers are willing to pay higher taxes in order to maintain quality education, state leadership has not indicated any willingness to address education shortfalls via taxation and the poll results seem to contradict the general sentiment (evidenced by anti-tax sentiment) to cut taxes, not raise taxes The housing market does not seem to be rebounding yet and, in fact, foreclosures are continuing to increase meaning that digests are not likely to increase in the near future and may well decrease some more

282 Political/Financial Implications (in no particular order) With a new governor taking over in January, the educational funding “unknown” is significant If digests continue to decrease and QBE earnings increase due to benefit increases and population increase, systems’ adjustments to their local fair share are likely to continue to shrink. High wealth systems will see a greater negative impact form this effect.

283 Political/Financial Implications (in no particular order) With a new governor taking over in January, the educational funding “unknown” is significant If digests continue to decrease and QBE earnings increase due to benefit increases and population increase, systems’ adjustments to their local fair share are likely to continue to shrink. High wealth systems will see a greater negative impact form this effect.

284 If we really do believe in public education, then we have a duty to bring to the public the message that quality education in Georgia is in peril, and along with it the future of our children and grandchildren

285 Promote public education tirelessly and unapologetically. If you value your freedoms, just remember that America must remain the Land of Opportunity…for ALL people “Only the educated are free.” Epictetus, 2 nd century Greek philosopher

286 And repeating the words of the AJC editor… “…the answer isn’t simply more money, it’s more money well spent.” Maureen Downey, Atlanta Journal-Constitution, 9/7/2008

287 Don’t say “We can’t do it that way” unless you know, for a fact, that you can’t “Whenever you are asked if you can do a job, tell ’em, ‘Certainly I can!’ Then get busy and find out how to do it.” Theodore Roosevelt, Statesman, 1858-1919

288 Be open to new ways of doing things. You can count on having to do more with less in the future, and finding ways to increase your productivity will help make “more with less” possible “If we don’t change, we don’t grow. If we don’t grow, we aren’t really living.” Gail Sheehy, Author, 1937- “By nature man hates change; seldom will he quit his old home till it has actually fallen around his ears.” Thomas Carlyle, essayist and historian, 1795-1881

289 Comments/Questions

290 Contact Information Doug Eza 1231 Beechnut Ln Watkinsville, GA 30677 ezafam@att.net 706 769-8230


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