Sarasota Herald-Tribune Explores How Florida Pays for Education in ‘School funding 101: How we pay for education’

The following article was published in the Sarasota Herald-Tribune on February 13, 2011:

 

 

School funding 101: How we pay for education

By Thomas Tryon
Published in the Sarasota Herald-Tribune on Sunday, February 13, 2011 

Can Gov. Rick Scott reduce property taxes that fund public education?

That question was posed to me last week during a conversation with the Landings Learning Group — three days after Scott proposed his first state budget.

The short answer: No, not by himself. Scott was required to propose the state budget, which includes revenues and expenditures for education. But it’s the Legislature’s duty to approve the budget.

The governor possesses a lot of political tools, including veto power, that can be used to persuade the Legislature to go along. But, as I told the group, legislators are very possessive when it comes to the budget, so expect the House and the Senate to raise a lot of questions about Scott’s plan.

The group, which takes its name from The Landings — the Sarasota development where its members reside — had plenty of questions about Scott’s budget.

This particular query prompted me to turn the tables and pose a question to the group: Who is aware of the Required Local Effort, the property tax Scott wants to cut, and its impacts on funding?

None of the learners tried to answer. Since the group’s members are civically engaged, I figure they’re not the only ones unfamiliar with the Required Local Effort or the other details of funding.

So, welcome to Florida Education Funding 101.

The Required Local Effort is a significant component of the Florida Education Finance Program.

The FEFP is the primary source of funding for public schools, kindergarten through 12th grade.

Florida’s constitution has long assigned the responsibility for funding public education to state government — the Legislature.

In 1998, more than 70 percent of Florida voters supported amending the state constitution to declare public education a “fundamental value of the people.”

The amendment further says the state’s “paramount duty” is to make “adequate provision for the education of all children residing within its borders.” The state is mandated, according to the amendment, to provide “a uniform, efficient, safe, secure, and high quality system of free public schools that allows students to obtain a high quality education …”

(Note: The constitution does not give Florida authority to fulfill its paramount duty to all children living in the state by giving them or their parents vouchers to offset tuition in private schools.)

Unfortunately, the state has not made adequate provision for a high-quality education for all children — at least not in comparison with funding in other states.

What’s worse, the state’s direct financial contribution to the FEFP is a paltry amount.

For instance, last year, less than 20 percent of the FEFP came from state sources, such as sales tax revenue. About 5 percent was allocated by the federal government.

The remaining 75 percent of the FEFP came from property taxes levied in each of Florida’s 67 county school districts.

How can that be, since the Florida Constitution prohibits the state from levying an ad valorem property tax?

The Legislature circumvents the constitution by requiring school districts to tax property in order to participate in the FEFP.

This Required Local Effort is a specific tax rate that is determined by the application of a complex formula.

The RLE varies from one school district to another, based in part on local property values. The revenue is essentially sent to Tallahassee, where it is redistributed to school districts according to the formula; that calculation is intended to equalize funding and prevent disparities.

In Sarasota and Manatee counties, the Required Local Effort is more than half the total property-tax rate levied by school boards.

For instance, last year the RLE for Sarasota County was 4.653 mills — out of a total school district rate of 7.901 mills. (One mill equals $1 of tax per $1,000 of taxable property value.)

Gov. Scott proposed reducing the RLE statewide, by an amount that would reduce the revenue generated by about $1 billion.

In a preliminary analysis to be presented Tuesday to the Sarasota County School Board, the proposed reduction would take at least $17.6 million off the table, about a 7 percent reduction; Manatee would take a similar hit.

A case could be made for reducing Florida’s dependence on property taxes, if that local revenue were replaced by state funds. But that’s not the proposal.

Scott contends that some of the reduction could be offset by cutting employee pension benefits. However, there’s no guarantee the Legislature will approve that controversial idea.

School boards have little flexibility for coping with substantial changes in revenue forecasts.

The Legislature provides for a “discretionary operating” millage, but school boards have little discretion. All but four of 67 districts levied the same “discretionary” rate last year; Sarasota and Manatee each levied the common rate — three-quarters of a mill.

Similarly, all but nine districts levied a capital-improvements millage between 1.25 mill and the maximum allowed by the state, 1.5 mill. Sarasota and Manatee were in that range.

There are only two other options for operating costs: A “critical operating” rate up to one-quarter of a mill, which Manatee approved for the first time last year, and a “voted operating” millage up to 1 mill. Sarasota County voters have approved the supplemental 1 mill.

The bottom line: There is little room to maneuver locally. If the Required Local Effort is reduced by the state, the lost revenue must be offset by local spending cuts.

This story appeared in print on page A16

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