Friday, January 19, 2018

Reading the Governor's tea leaves

Governor Baker's remarks today to the Mass Municipal Association's annual meeting gave some bits of information about what his FY19 budget, to be released next Wednesday, will include. You can find excellent coverage of this from Kate Lannan of State House News Service.
The short version is this:
According to Baker's office, the newly proposed $118.6 million increase in education money -- which will bump the total to $4.865 billion -- includes $103.6 million in Chapter 70 schools aid and $15 million in additional aid for school districts that have seen an influx of students from Puerto Rico and the U.S. Virgin Islands after last year's hurricanes.
The first test is the one that Baker created himself: he said when he was campaigning that local aid categories would rise in proportion to increases in state revenues each year. As was noted by State House News Service yesterday:
According to the Massachusetts Taxpayers Foundation, unrestricted local aid increased between fiscal 2016 and 2018 by 3.6 percent, 4.3 percent and 3.9 percent, respectively, while Chapter 70 aid increased by 2.54 percent, 2.58 percent and 2.57 percent.  So-called consensus revenue accords that served as a basis for state budget building exercises from fiscal 2016 through fiscal 2018 were based on projected increases in state tax collections of 4.74 percent, 4.31 percent and 3.9 percent, respectively, according to the taxpayers foundation.
Thus that hasn't happened in Chapter 70 at all.
He doesn't fulfill it this year, either, as a 3.5% increase, in line with revenues, would be $166M.

As it happens, I think this is not the best way of deciding how we increase aid, particularly something like Chapter 70 aid, which has a formula which is based on something other than the vagaries of revenue increase. On the other hand, it is a commitment Baker made that he has not fulfilled.

The $15M for students from Puerto Rico is good; the Governor had this to say about it:
"The number's significant enough that we felt it was important the commonwealth step up," Baker said after his speech. "This wasn't something that anybody built into their budgets at the beginning of the year, and we felt it should be incumbent on us to basically step up and fund them, the same way we would under a traditional Chapter 70 education distribution."
"The same way we would under a traditional Chapter 70 education distribution" would seem to mean that the students are counted as ELL students plus the economically disadvantaged count and get the foundation amount per pupil. We'll see on Wednesday.
Is that enough? I'm suspicious that it's where the $3M cited in this article from Worcester comes from ('though that wouldn't include an economically disadvantaged portion). The answer is that it probably isn't, because we're still running on non-reformed ELL and economically disadvantaged numbers.

The Chapter 70 amount also "includes $24.3 million toward addressing rising costs of health care for retirees," about which the Governor said the following:
Baker called it a "significant investment" and noted that it responds to a recommendation made by a commission that studied the state's school funding system.
The actual recommendation of the Foundation Budget Review Commission, however, was this:
Add a new category for “Retired Employee Health Insurance” to the foundation budget
We won't know for certain until we look at the proposed language for Chapter 70 in the Governor's budget (remember, we have to pass the actual MGL each year to designate foundation budget amounts), but I'll venture to guess that this doesn't implement the actual recommendation; my guess is that this is similar to what happened last year, when the dollar amount increased, but the language didn't change.
That doesn't actually implement the recommendation.

I also am not going to tell you that $25M isn't a lot of money, but the Springfield Public Schools all by themselves had a foundation budget gap larger than $25M for health insurance in FY16, so I don't think that's going to go very far.

I also want to flag something here: this piecemeal approach, which we're now seeing in a second budget and that I know lives in at least one bill in the Legislature, is not a good idea. Health insurance, while expensive, is an easy win. Everyone has it. Everyone knows that it goes up by a lot each year. It's pretty straightforward to explain how those high percentages aren't reflected in the budgetary increases.
Not everyone has that many students who are learning English, or who are poor, or who have special education needs. So not every district benefits if we raise those rates.
But if we keep on just doing health insurance, we aren't fulfilling our Constitutional charge as a Commonwealth under McDuffy:
provide an education for all [our] children, rich and poor, in every city and town
More when the budget is released on Wednesday 

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