If tax fails, Arizona schools' pain will multiply

April 14, 2010

The Arizona Republic

Pat Kossan and Ray Parker

Regardless of whether a 1-cent-per-dollar sales-tax increase is approved in May, Arizona's K-12 schools are going to take a financial hit next school year.

In the recent legislative session, lawmakers cut 8 percent from the state schools budget next year. If voters shoot down the sales-tax increase on May 18, that cut will more than double.
Both supporters and opponents of the tax hike agree that if the ballot measure fails, it will be a shock to the state's charter and district schools.

But the ultimate result of the shock is where viewpoints diverge.

The Goldwater Institute, a conservative think tank in Phoenix, says schools need to shake up an antiquated system that hasn't improved student learning in a decade.

A 17 percent cut isn't the preferred way to restructure Arizona schools, but giving them more money over recent years hasn't resulted in higher student test scores, said Matthew Ladner, researcher for the institute, which opposes the sales-tax increase.

"Throwing money at schools, which is pretty widely acknowledged at this point, does not work," Ladner said.

Educators and others say chopping nearly a fifth of school funding would cripple advances in student learning that took a decade to achieve and would threaten future innovation. Parents also would have to pay more in fees for tutoring, sports, enrichment programs and clubs such as debate, drama and robotics.

Even some state organizations that champion a revolution in how public schools operate and relentlessly oppose tax increases have thrown their support behind the increase, citing the severity of the budget crunch.

Those include the Arizona Chamber of Commerce and Industry and the Arizona Tax Research Association.

The tax, known as Proposition 100, would increase the state sales tax to 6.6 cents and raise $1 billion for each of the next three years, with $2 out of every $3 going to K-12 and university education.

Kevin McCarthy, president of the Arizona Tax Research Association, a longtime tax foe who supports Prop. 100, said the budget crisis is too severe to vote down a temporary tax hike.

"We're still in a multiyear challenge to try to get the state back to fiscal solvency," he said.

Without the extra sales-tax money, supporters say, schools would take a cut that is too big and too quick and that comes without a plan to protect the best teachers and counselors and innovative classroom technology and programs.

"Those programs are hard to get back, and it took years to grow them," said Steven Seleznow, president of the Arizona Community Foundation and a school-reform advocate.

Impact of cuts

Since 2000, Arizona has never ranked higher than fourth from the bottom in per-student spending compared with other states and the District of Columbia, according to the U.S. Census Bureau. Since a small jump in 2007, average state per-student spending has flattened out and, when adjusted for inflation, has fallen, according to the Joint Legislative Budget Committee.

So, even in good times, state school budgets were tight. Aside from budget cuts, bad economic times have brought declining enrollment, which means a loss of per-pupil funding, and a drop in property and sales taxes that schools depend on. The state did receive about $500 million in federal stimulus money to help fill K-12 budget gaps in the 2008-09 and 2009-10 school years. The last $90 million of the stimulus money has already been factored into next year's budget.

When the state accepted the stimulus money, it promised the federal government that it would maintain education spending at the 2006 level. If the sales tax fails, state funding for schools will fall below that level. That would require Arizona to seek a waiver from the federal government and would leave the state open to penalties if it was not granted.

Schools are looking for ways to make up at least the 8 percent cut already made by lawmakers, which equals $385 million, or an average $374 per student in district schools and $297 per student in charter schools. Lawmakers also are preparing contingency plans if the sales-tax measure fails. Schools would lose an additional $427 million, bringing the average total cut to $795 per student in districts and $577 per student in charter schools,according to figures released by the Governor's Office.

"We don't know exactly what individual decisions districts will make, but if Proposition 100 fails, schools in Arizona next year will look drastically different than they do this year," said John Wright, Arizona Education Association president.

Changes weighed

Schools boards are considering various changes for next year because of the budget cuts.

• Fewer students will be playing sports, and there will be fewer sports to play. For example, Mesa Public Schools could implement a $100 sports fee next year, the first time the state's largest school district has charged such a fee. If the sales tax fails, that fee could rise to $150 per sport. This year, Scottsdale Unified School District charged a $125 high-school athletic fee per sport and is considering an increase to $150 next year. If the sales tax fails, Scottsdale could raise that fee to $450 and eliminate middle-school sports.

"You'll see a new system of have and have-nots in terms of being able to participate in scholastic sports," Wright said. "The idea of charging for sports and eliminating the sports that have fewer participants is a combination you're going to see."

• Most schools would lay off more staff, require staff to take days off without pay or institute across-the-board reductions in pay. Many would do all three. For parents and students, that would mean larger classes, fewer physical-education and music classes, and fewer janitors, librarians, counselors and reading specialists. Those are the most common programs mentioned in schools' contingency budgets if the tax fails, said Janice Palmer, lobbyist for the Arizona School Boards Association. Some districts will not be able to pay teachers to work with speech-and-debate clubs or robotics clubs, gifted and talented programs, or tutoring for struggling students.

• Arizona district and charter schools were once eagerly creating innovative programs and beautiful campuses to compete with each other for students and the attached per-pupil funding. Now, many charters are simply trying to survive. Many are locked into bond-debt payments and other loans used to build their campuses.

Anjum Majeed owns Self Development Charter School, a 279-student for-profit school in east Mesa that the state rates as an excelling school.

"We take everyone," Majeed said. "Some of our students are extremely bright, others are struggling. And they thrive on the one-to-one intervention."

But that one-to-one intervention takes teachers, which Majeed calls the heart of the school's success and something she will not be able to afford if the sales tax fails.

"I'm telling you that's a very serious impact," Majeed said. "That is the essence of our program. We will try to figure it out, but we don't know how."

The debate

In education, as in other publicly funded programs, some policy leaders say a crisis affords opportunity to change the status quo and build something more innovative.

Ladner, of the Goldwater Institute, said Arizona schools can use this opportunity to cut the number of non-teaching staff members and lay off ineffective teachers while raising class sizes without hurting student achievement. Schools can cut administration positions and make parents pay more for extracurricular activities, he said.

"I'm not going to pretend that it's going to be easy," Ladner said. "It's a matter of priorities."

Ladner has long suggested that schools can save money by making classes larger and increasing pay for fewer top-notch teachers. Research shows a highly skilled teacher is more important to student progress than class size, he said.

Glenn Hamer, president of the Arizona Chamber of Commerce and Industry, said he also supports reform but prefers a researched plan and not one created on the fly because of an economic emergency. Hamer said the temporary sales tax is needed to help schools get through hard times. He favors gradually implementing changes similar to ones in Florida that are credited with raising test scores, particularly in reading and for English learners.

"It was a comprehensive plan," Hamer said. "It was very well thought out and well-implemented. It wasn't done with a 30- or 60-day plan and they were going lose $429 million, so let's create a magic plan to save our schools."

Perhaps a few states with large schools budgets could use a steep cut to stimulate needed changes in its education system, Seleznow said. But, in Arizona, "we're talking about cuts where the per-pupil funding is lower than almost every other state," he added.

Before moving to the Arizona Community Foundation this year, Seleznow was education director for the Bill & Melinda Gates Foundation and dedicated to changing the way K-12 schools operated.

He wants Arizona schools to outsource more services and eliminate textbooks and pen-and-pencil tests in favor of online curriculums. He also supports minimizing the district-centered system so that each school principal makes decisions about hiring, firing, curriculum and teacher training. Principals and teachers would keep their jobs only if they improved student learning, not by seniority or earning additional degrees.

They are the kinds of changes that take new investments, such as ensuring schools have enough computers, teacher and principal training, data-collection systems and high-speed Internet access to make a successful shift and create big savings in the future.

Arizona schools already cut fat and will be required to cut bone next year if the sales tax fails, Seleznow said. "Then you're amputating critical programs."

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