Member Summit 2013 WHAT IS GOING ON WITH SCHOOL FUNDING?

2 Stable and Equitable School Funding Committee

3 SCHOOL FUNDING COMMITTEE What is it? A group of Stand members from all over the state who want to improve their understanding of education funding issues and become more effective advocates. Why did I chose to serve? To become better educated about funding issues To be able to evaluate legislation To serve as a resource for my local chapter

4 SCHOOL FUNDING COMMITTEE Big Takeaways: Education funding is very complex and many issues are inter-connected. Stand cannot focus just on school budgets without considering health care, PERS, prison spending, demographic trends, and union and business interests.

5 SCHOOL FUNDING COMMITTEE Key Points: Property tax reform can provide a significant local revenue source for schools. PERS reform –There is a significant crisis looming due to the economic down turn (PERS fund lost 27% in one year) and shifting demographics (the ratio of taxpayers to non- taxpayers will shift from 1:3 to 1:1 over the next three decades). School districts must cover these costs. Innovation is critical. The state and individual districts must find ways to reduce costs while improving outcomes.

6 Overview of State Funding

7 GOVERNORS RECOMMENDED BUDGET (GRB) Governor Kitzhabers recommended budget for K-12 education in the 2013/2015 biennium presents a couple scenarios. The first would provide $6.15 billion for the State School Fund (SSF) The second would provide $6.4 billion for the SSF. The additional $250 million is the result of proposed changes in the Public Employee Retirement System (PERS).

8 GRB: THE $6.15B SCENARIO $6.15 billion is an $450 million increase over the legislative approved budget or an additional $1000 spending per student. Despite the increase funding, the $6.15B scenario would leave many districts with gaping holes in their budgets, namely due to the increase in their PERS contributions. PPS – $16.7 million gap Beaverton – $15 million gap Medford – $2.5 million gap

9 GRB: THE $6.4B SCENARIO The additional $250 million would come from proposed changes to PERS: capping the cost of living increase at 2% for the first $24,000 and eliminating the state tax subsidy for out-of-state retirees. If approved by legislature, both are likely to be challenged in court.

10 GRB: 4 TARGETED INVESTMENTS The GRB also calls for 4 targeted investments, as suggested by Dr. Rudy Crew and approved by the Oregon Education Investment Board. The governor has budgeted an additional $34.1 million (in addition to the $6.15 billion) the three of them and proposes to use $120 million of the funding currently provided to education service districts (ESD) for the forth. Total of $154.1 million for targeted investments

11 GRB: 4 TARGETED INVESTMENTS OregonReads – a multi-agency initiative to improve third grade reading skills: $9.2 million Guidance and Support for Post-Secondary Aspirations – for the development of a culture of expectations of opportunity and success: $11.4 million Science, Technology, Engineering, Arts, and Mathematics (STEAM) – intended to provide students with the skills, knowledge, and experience necessary for success in the workplace by investing in STEAM programs: $13.5 million

12 GRB: 4 TARGETED INVESTMENTS A Representative Corps of Professional Educators – establishes four to six regional Student Achievement Centers to promote excellence in teaching and learning for teachers, faculty, early education professionals, administrators, and instructional support personnel and focus on educator recruitment, preparation, and support Up to $120 million from current Education Service District Funding

13 GRB: NEXT STEPS End of Feb 2013 – Legislative Revenue Office (LRO) releases March Revenue Forecast March 2013 – Co-chairs of Ways & Means (Sen. Devlin and Rep. Buckley) release their recommended budget April/May – Ways & Means subcommittees discuss and debate budget recommendations, fill in the details, gather information May – LRO releases May Revenue Forecast. This is also called the end of session forecast. The legislature cant spend more money than is in this forecast.

14 GRB: NEXT STEPS Late May/June – Ways & Means subcommittees and full committees start passing budget bills. All budget bills must be passed by June 30 th. Key Players: Senator Richard Devlin (Tualatin) and Representative Peter Buckley (Ashland) – Ways & Means Co-Chairs Senator Rod Monroe (Portland) and Representative Betty Komp (Woodburn) – W&M Education Subcommittee Co-Chairs

15 Questions?