TESTIMONY TO EDUCATION FUNDING ADVISORY BOARD

State Superintendent of Education Glenn W. M^cGee

July 28, 2000

Good afternoon.  Thank you for accepting the monumental challenge of addressing school funding issues in Illinois.  As State Superintendent, I look forward to working with you the next few months as we grapple with these issues and explore solutions to the pressing financial problems facing our schools.

I would also like to thank Governor Ryan for his commitment to our schools, for fulfilling his pledge to deliver 51% of new revenue to education and for his leadership in asking this panel to take a comprehensive look at educational finance reform.  In addition, I must express my enthusiastic and sincere appreciation to the members of the General Assembly for their support in the appropriations process, for raising the foundation level every year, for fully funding special education categoricals and for delivering the financial resources necessary to build new classrooms and new schools for our growing enrollment.

Recently, I completed a Schoolhouse Tour that took me to schools across the state, from Rockton to Vienna and Rock Island to Effingham.  In every location--including rural districts, Chicago, including the suburbs--the most common concern was educational funding.  At each stop, educators and parents voiced similar problems.   The seven critical funding issues were:

Inequities in Resources

Members of the public who spoke at the meetings clearly understood that the reliance on property tax created some significant inequities throughout the state.  In East St. Louis, there is approximately $8,000 of Equalized Assessed Valuation—EAV—behind each student, while on the north shore, where I was a superintendent for seven years, some high school districts had more than $800,000 of EAV behind each child.  In real world terms, what does this mean?  It means the students in the northern suburbs have access to libraries and media centers of 30 and 40 thousand square feet while the school libraries at some of our schools in East St. Louis are housed in rooms that are smaller than a regular classroom.

Though the formula works as it was designed, several problems have arisen because of it.  School districts have become reliant on the “Hold Harmless” funding—it is truly the “lifeblood” of their schools and without it, student learning would be seriously compromised.  Also, districts that lose enrollment or who have growing EAVs lose state aid.  Last year more than 300 downstate districts had less state aid than they had the year before!  The “one size fits all” foundation level cannot hope to provide adequate funding for high schools or for grades where I believe the most resources are needed—our primary grades.  Clearly, bold action is necessary to solve these problems.

Over-reliance on Property Tax

At nearly every stop on our tour, I heard from community members concerned about growing property taxes.  They are caught in a disturbing dilemma.  They want to support schools, but some cannot afford to pay any more property tax.  In districts with low EAVs, the property tax rates continue to grow to levels that threaten the ability of homeowners to continue to pay them.  In districts with high EAVs and growing enrollments, the high costs of the property taxes create conflicts between taxpayers and educators, parents and senior citizens. 

Poverty

Because the additional funding for impoverished students is tied to 1990 census data, many schools have not been able to obtain the finances necessary to keep up with growing enrollments of students from low-income families.  The result has been that our most needy children are not getting the programs and services they need.  The correlation between percentage of low-income students and ISAT reading scores is negative 0.8—that is enormous--and the relationship is causal.  Poverty has a direct and measurable impact on achievement that is an order of magnitude greater than the effect of mobility.  Moreover, districts with 19% low-income students are not eligible for additional funding while districts with 95 and 100% low-income students, such as James Weldon Johnson School, where my wife works, receive the same per pupil amount as districts with 80 %.  I know for a fact that schools with such large percentages of low-income students need more resources.

Early Childhood Education

Given Governor and Mrs. Ryan’s visionary leadership and avid support for early learning, and the General Assembly’s generous increase for early childhood, more and more schools districts are striving to assure that pre-kindergarten students come to school ready to learn and that their parents have access to quality programs and services before their children even enter kindergarten.  Despite the significant increase in our state budget, at nearly every school we visited we heard about the need for more funds to support early learning.

Infrastructure Needs

Although the school construction program has been a phenomenal success, school districts still do not have access to resources for some crucial repair and maintenance needs.  Access to funding to fix leaky roofs, replace broken windows, fix hazardous conditions and conduct preventive maintenance is essential.  Moreover, some schools simply need more space.  Some schools that seek to reduce class sizes do not have the space available, and there are several districts seeking to implement full day kindergarten programs but lack the space to house the students.

Longer School Days and Longer School Years

Many educators and parents know that summer school needs to be a way of life for thousands of our students.  Our poor children, especially, suffer when they cannot continue their education during the summer months.  The Summer Bridges program has been a well-documented success.  The last two summers thousands of students significantly improved their reading.  Likewise, the time between 3:00 and 6:00 p.m. is a time when students need to be engaged in activities that enhance their learning.   It is well known that these hours are the time when many middle school and high school students get into trouble when they are idle.  It is a time that has enormous potential but has little financial support.

Special Education

Finally, at each meeting we heard concerns about special education.   Though educators are truly grateful for the increase in categorical funding—an increase that I actively sought long before I took this office—we are not keeping up with the demands for these programs and services.  We are also not keeping up with the impact on regular education students, because the funding to meet the federal mandate must come from somewhere.  If the state cannot provide it, the local districts must.  I recently sent Representative Krause a graph (attached) that illustrates how the current level of $8,000 reimbursement for each special education teacher has not kept up with the growth in CPI.  Though we now fully fund the $8000, this figure represents less than 65% of the value it had when it was first authorized.  The $8,000 reimbursement, which was set in 1985, would now be nearly $13,000!  Unless changes are made, districts will continue to absorb more of special education costs with local taxes, thus negatively impacting programs for both regular and special education students.

Given these concerns, which reflect what I have found in countless school visits across the state, I respectfully request that the panel address the following issues.

Alternative Revenue Stream

First, I am requesting that you explore and recommend a new revenue stream to replace a portion of the property taxes.  I believe that there are several possibilities and that we are only bound by our creativity.  Income tax is one possibility—perhaps phased in over time.  A tax on Internet commerce is another.  Those of you who have bought books, toys, flowers or anything else on the Internet know that taxes are not collected.  Gaming may also be a possibility.  Though I realize that there are ethical dilemmas with the use of gaming money, studying this option may be worthwhile.  At this point, I am not recommending any single revenue stream--in fact, there are probably other possibilities--but I am recommending that we identify some additional revenue source to address the over reliance on property tax and inequities in the funding formula.

Changes to Poverty Calculation

Second, I am asking that you move the eligibility level down from 20% to assist districts that have significant numbers of students from low income families and that you consider giving additional funding to districts that have an enrollment of low income students above 95%.  Finally, I hope that you study the current “steps” for poverty funding and make a recommendation to narrow them.  For example, a school with a low income enrollment of 35% gets the same amount of per-pupil poverty funding as a school with an enrollment of 50%, yet significantly more resources are needed to address the problems in the latter school. We must do something to help our low-income students achieve their aspirations. 

Adequacy

Third, I ask that you consider addressing the adequacy level by grade span.  I heard from high school superintendents that they need a weighting factor.  Having spent a good deal of my life in primary classrooms, though, I can tell you that unless we make an investment up front with small class sizes, with trained classroom assistants, and with early reading intervention, our costs at the back end will continue to soar beyond our financial capabilities.  When we have not taught our young children how to read by third grade, when we have not provided them support, they will choose to drop out and get in trouble.  As you know, for those students who end up in our system of corrections, the annual cost soars in comparison to our education foundation level.  I would hope that you could look at the adequacy level by grade span.  An amount for pre-kindergarten to third grade, a different figure for fourth to eighth grade, and a third level for high school would be most beneficial to our students.

Pre-kindergarten

Currently, early childhood funds are block granted.  Districts do not have the ability to make long-range plans for early-childhood programs and services since they depend on an annual grant.  As long as the block grants exist, programs are in potential peril.  We need to build pre-kindergarten enrollment into the formula to provide consistency.  I hope that you will consider our two, three and four year olds when you propose changes to the formula.

Special Education

A fifth area is special education.   As I noted earlier, special education funding deficiencies impact all students.  The federal government has been woefully inadequate in funding their obligation to special education, and Chairman Gidwitz and I are working hard in Washington to get more federal support.  We have had some encouraging responses, but we still need to address the level of personnel reimbursement.  As I noted earlier, I would hope that we could set an amount above the $8,000 figure that was set in 1985 -- and perhaps build in CPI adjustments.

Teacher Shortage

Finally, I would be remiss if I did not draw the teacher shortage issue to your attention.  It was raised in our Schoolhouse Meetings, it is a subject of news articles throughout the state, and it even came up at our recent hearing on special education certification.  It may not be within the scope of your committee to grapple with one of the most critical problems we face, but I hope that you will spend a few moments wrestling with these questions: How can we recruit teachers for rural and inner-city areas?  How can we keep our good teachers in our most needy school districts?  How can we use the funding formula to provide for a “caring, qualified teacher” in every classroom?  Again, this matter and these questions may be beyond your purview, but I believe that your good minds could come up with some sound solutions.

These are the six areas.  With your leadership and the support of the State Board, the Governor and the General Assembly, I know that we can deliver on an aspiration that we all share—to deliver a quality of education to each and every one of our students that is truly Second to None.

Glenn W. M^cGee

State Superintendent of Education