School districts have borrowed $346 million—and taxpayers will pay to pay up to $11 million in interest payments—as a result of Gov. Wolf’s budget vetoes, according to a report from Auditor General Eugene DePasquale.
DePasquale noted that this borrowing is due to the lack of tax dollars flowing out of Harrisburg—despite the fact the state is certainly still taking money from taxpayers.
At the press conference announcing these findings, Sen. Scott Wagner stood up to say he’s tired of taking blame for Gov. Wolf’s actions. That is, the House and Senate passed a budget—and subsequently passed a temporary funding plan—but Gov. Wolf’s vetoes denied funding for schools and social services.
Sen. Wagner is right. The only person to blame for schools having to borrow money is Gov. Tom Wolf, who vetoed the original budget in its entirety—rather than using the line-item veto as previous governors have done—and the temporary stop-gap measure.
Wolf says his vetoes are about education funding, but are they really?
Education spending is already at an all-time high, while Pennsylvania ranks among the highest spending states. The Republican-passed budget would have increased aid to public schools by another $350 million (and $1.4 billion more than four years ago).
Republicans even offered Gov. Wolf $300 million above that total.
Gov. Wolf thinks that’s not enough, and continues to cling to his demand for higher taxes on working families.
But there can be no doubt, Wolf is the only reason schools are struggling to make payroll.
With the state budget impasse in its third month, funding for critical things such as education and social services remains in question.
CF’s Elizabeth Stelle spoke with WHYY’s Marty Moss-Coane and opposite Keystone Research Center’s Stephen Herzenberg regarding the impasse and why a compromise has not been reached in Harrisburg.
Among the key points at issue in the budget discussion have been education funding, Wolf's proposed severance tax, pension reform, and liquor privatization.
While Gov. Wolf claims to have made concessions on everything, his “compromise” contains most of his original plans to hike taxes on hardworking Pennsylvanians. And despite the legislature's offer to meet in the middle, the governor continues to push for income and sales tax increases.
Click here or listen below to hear Elizabeth explain what can be done to pass a taxpayer-friendly and fiscally responsible budget.
Radio Times with Marty Moss-Coane airs weekdays 10-11 a.m. and 11-noon.
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On June 30, state lawmakers passed a budget that offers $10.4 billion in state support for public schools. This represents an all-time high—indeed, an increase from last year’s all-time high—and represents a $1 billion increase since 2010-11.
Recently, legislative leaders offered Gov. Wolf a deal that would increase education spending by another $300 million. At the time of this writing, Gov. Wolf is “still considering” this offer. The governor is struggling to take "yes" for an answer.
The chart below compares the budget passed by the General Assembly, the compromise offered by Republican leaders, and Governor Wolf's proposal (which comes with $8 billion annually in new taxes on working families).
Chester Upland School District is ground zero for the most recent example of this hyper-partisan, antiquated philosophy.
Yesterday, the Wolf administration went to court in Delaware County, filing an amended recovery plan for Chester Upland that would slash district payments to charter schools. Officials project $25 million in savings entirely through reduced payments for special education charter students and flat-funding cyber charter students at $5,950 per pupil.
Although Wolf admits that district finances have been “mismanaged for over 25 years,” his solution is to effectively block families from a escaping a school system that has, in the words of Wolf, “failed its students.”
What does failure look in Chester Upland? Two percent of students are proficient in math at Chester High School. Sixteen percent are proficient in reading. The average SAT score for Chester High students is 725 (out of 1600), and the School Performance Profile (SPP) score is 33.5.
In contrast, the three brick and mortar charter schools that receive Chester Upland students have SPP scores of 71.7, 61.5, and 51.3. Parents and students have been fleeing to better-performing schools.
Persistently low academic performance spurred almost 54 percent of Chester students to enroll in charters. Naturally, charter payments assume a significant chunk of the district budget—46 percent in 2014-15.
Although charter students account for more than half of the district’s enrollment, they comprise less than half of the district’s cost.
Chester Upland certainly faces financial challenges, but charters are not the culprit. Amazingly, the revised recovery plan includes no other cost saving measures aside from the punitive action taken against charters.
The illogical Wolf Doctrine on public education is perfectly encapsulated, here, by Education Secretary Pedro Rivera:
“For too long the quality of education a student receives has been dictated by their zip code, and in some cases a child’s education has suffered due to the missteps of adults. Reducing the structural deficit is essential in order to secure financial stability for the district and make the improvements needed to provide Chester Upland students with the opportunities they deserve.”
These remarks are detached from reality, as it is the Wolf administration perpetuating the “education-by-zip code” travesty that has dominated public education for decades. Trapping families in a failed district and arbitrarily punishing students seeking alternative educational options will not produce “Schools that Teach.”
The consequences of Gov. Tom Wolf’s lock-step fealty to public sector union interests are being felt across the state and particularly in York City—where one of Wolf’s first major decisions as governor is generating renewed skepticism among those seeking improvement for the failing school district.
In March, the Wolf administration forced out York City recovery officer David Meckley and withdrew the state’s petition to introduce transformative change to a school system known for financial distress, abysmal academic performance, and astounding rates of violence. Meckley, who sought to implement a charter school model, realized Wolf was wedded to the status quo and would not accept a solution that prioritized students and families over government unions.
What has been happening in York City since the new recovery officer assumed her position?
If a recent editorial from the York Daily Record is any indication, not much. Saylor hired an outside firm to study the school district and provide recommendations. Highlights from the report include the following:
- Teacher attendance dropped to 88 percent in 2014-15 (which is actually lower than student attendance, according to Saylor).
- Barely half of district personnel believe the quality of education delivered by the district is good or excellent. Four percent of teachers believe that education quality is excellent.
- 86 percent of school and central office personnel report that the district does not reward or retain excellent staff.
- 75 percent of school staff do not believe individual schools have sufficient decision making authority over their budgets.
The report also noted that York City’s per pupil funding is on par with the state average. Accordingly, the district may need to “revisit its spending strategy to ensure practices are centered on student learning needs.” However, in June, the teacher’s union voted to accept a new collective bargaining contract that increases pay over the next two years.
And just this week, York City announced it has hired a new “information specialist’’ to create “positive publicity with the outside community.” Editors at the Daily Record describe the hire as unnecessary and an unwise use of limited resources:
Ms. Saylor and other district officials ought to be able to speak for themselves to the media and the community. And they certainly ought to be able to perform effective internal communications—or perhaps they shouldn't be in their current positions.
While he may not be involved the district’s day to day operations, the governor’s fingerprints are all over the situation in York City. The decision to force out Meckley—and, in so doing, jettison meaningful education reform—will have lasting repercussions for families who deserve better than a ten year plan and an information specialist.
This is what desperation looks like.
Gov. Tom Wolf recently visited Downingtown Area School District and claimed the no-tax-increase budget he recently vetoed "includes only $8 million for education—that’s less than 3 cents, per child, per day."
Where to begin? To start, let’s clarify that the Republican budget spends more than $10.4 billion—that’s billion, with a B—in support of public schools. Gov. Wolf’s $8 million figure is misleading because it refers only to the increase over the previous fiscal year.
The $8 million figure also happens to be false. The budget Wolf vetoed includes $100 million in new Basic Education spending, $20 million in new Special Education spending, $30 million in new early education spending, $50 million in new higher education spending, and $573 million more for school pensions. Sure, these totals are less than Gov. Wolf requested in his March budget proposal—a spending and tax package that was voted down 0-193—but the Republican plan spends money the state can actually afford.
As for the "3 cents, per child, per day" remark? It’s a cute talking point from a governor who, as PennLive recently described him, acts "less like a chief executive and more like a perpetual candidate."
But it tell us nothing. If, for example, we applied the same math to the mythical "billion dollar education cut" often decried by the governor, it would amount to a reduction of 3 dollars, per child, per day. Keep in mind, too, that this "cut" is a complete fabrication.
Over the past week, we've learned the Wolf administration is fixated on tax increases, adept at parroting union talking points, and prone to dividing by large denominators. The time has come to retire from campaign mode and face reality.
At the end of last month, Gov. Wolf vetoed the Republicans’ budget, criticizing it for failing to meet his lofty goals of closing the structural deficit, increasing education funding through higher energy taxes, and providing property tax relief to homeowners. Those goals come with a hefty price, primarily more taxes for Pennsylvanians at all income levels.
Here’s why: If we concede (we shouldn’t) the severance tax won’t hurt people in low and middle income households, it still won’t raise enough revenue to pay for the governor’s education proposals, let alone his plan to reduce property taxes or close the deficit. To raise enough revenue for all three priorities, he needs broad-based tax increases, which Republicans have ruled out.
Right now, there has not been any better ideas presented to us than increasing the personal income tax, increasing the sales tax, while providing the property tax relief that was not included in their budget
The governor has drawn a line in the sand: Either tax low and middle income families or Pennsylvania continues to operate without a budget. His position is puzzling considering he campaigned on protecting low and middle income people from tax hikes.
Not only is Gov. Wolf breaking one of his core campaign promises, but his position won’t fix what he sees as some of the state’s biggest problems:
The structural deficit: His own budget plan—and the gigantic tax increase accompanying it—won’t eliminate the structural deficit. According to the Wolf Administration’s own calculations, by 2016-2017, the state would face a $318 million deficit under his plan.
Severance tax/education funding: The governor wants to impose a severance tax on the natural gas industry. He’s too late. Pennsylvania already has a severance tax, but it’s described as an impact fee. And according to the Independent Fiscal Office, it’s the equivalent of an effective 4.7 percent tax rate on production. The revenue raised from the tax rate is just one of the many taxes the natural gas industry pays.
Yet the governor continues to push for an even higher severance tax to "restore education funding cuts of the last four years." There are two problems with this narrative. One, education spending is at its highest level ever. Two, there is no link between higher levels of education spending and academic achievement.
Property tax relief: Providing property tax relief through tax shifting treats the symptom instead of the disease. Property taxes are on the rise because education spending is ballooning. If the state shifts the tax burden, but doesn’t control education spending, taxpayers will continue to take a hit, just in a different pocket.
Gov. Wolf can break the budget impasse and provide Pennsylvanians the “fresh start” he promised during the campaign, but he’ll need to abandon his fixation on the stale policies of the past.
There's a lot of misinformation being thrown around about the Pennsylvania state budget and education spending. While folk are entitled to their own opinions, they aren't entitled to their own facts.
The charts below illustrate some of the key trends and data points in Gov. Wolf's proposed budget and in state education spending.
Scroll down to advance the slideshow.
Gov. Tom Wolf’s veto pen may be running out of ink.
In the span of one week, Pennsylvania’s “different kind of governor” vetoed a no-tax-hike budget, liquor privatization, the school code and the fiscal code. He is currently debating whether or not to veto pension reform, as well. But that’s not an exhaustive list.
By vetoing the budget bill, Gov. Wolf turned down a $100 million increase for Basic Education, a $20 million increase for Special Education, a $30 million increase for early education, and $50 million more for higher education. He even vetoed the implementation of a new, bipartisan school funding formula—particularly curious since the formula, which would distribute funds based on student need, has been universally applauded.
At every turn, Gov. Wolf has embraced and perpetuated the myth that Pennsylvania schools are underfunded and suffering from a phony “billion dollar cut.” The administration conveniently ignores the fact that Pennsylvania spending per student ranks 10th in the country, and total school spending is at an all-time high. Seemingly nothing can deter Gov. Wolf on his quest to raise taxes—in the form of income, sales, and severance taxes—on families and small businesses.
Rather than seek common ground or areas of compromise, the governor insists on a budget—his own—that was voted down 0-193.
Thankfully for working families who would be burdened by Wolf’s tax increase, even 4 billion vetoes cannot enact $4 billion in new taxes.
Much of the reaction to the Basic Education Funding Commission’s final report has been positive—and for good reason. The commission proposed a formula that finally distributes funds based on enrollment and student need.
But a new formula alone is not sufficient to rectify Pennslyvania’s irrational system of distributing state aid to public schools. CF has written and testified about the state’s “hold harmless” provision, which guarantees each school district the same level of state funding it received the previous year. While the policy ostensibly exists to prevent school districts from being harmed by reduced funding, it has, in fact, brought harm and inequity to hundreds of growing districts across the commonwealth.
In order to ensure the year-long funding commission's work produces meaningful policy reform, a sensible transition away from hold harmless is essential. If, for example, the new formula is only applied to new spending—and some $5 billion in education funding remains attached to hold harmless—the broken funding method will remain unscathed.
In its report, the funding commission offered only broad suggestions regarding hold harmless. During a press conference last Thursday, Sen. Pat Browne explained phasing out hold harmless is a “budget decision” that must be tackled by the entire General Assembly.
This morning, the Senate Education Committee advanced SB 910, legislation that will implement the new formula. Unfortunately, SB 910 retains hold harmless for Basic Education spending during the “base year” (which will mean either 2014-15 or 2015-16) and applies the new formula only to future spending.
This is a moderate improvement over the status quo, as explained by Kara Newhouse in Lancaster Online:
In the past, districts were guaranteed at least as much money as they got the year before, and then some. Then the next year, the district would be guaranteed that new amount. And so on.
Doing that every year allowed inequities to snowball.
The commission instead wants to freeze the amount that districts get (either this year or next year) as the guaranteed base.
In other words, SB 910 would put an end to the “snowball effect” of annually resetting hold harmless levels, but it falls considerably short of an ideal outcome. The commission’s formula is rational, equitable, and transparent, which is why applying the formula to the entire Basic Education line item is preferable.
If lawmakers are hesitant to make substantial reforms in a single budget year, they could distribute a portion of the Basic Education appropriation under the proposed formula over a set time period. The funding commission, in its report, suggested 10 percent over 10 years, but this could be adjusted as lawmakers see fit. The key is to begin phasing in the new formula to as much of the line item as possible, while giving school districts reasonable time to prepare for new funding levels.
The sooner we distribute the bulk of education funding by a student-based formula, the better for Pennsylvania’s public school children.
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