PLACING ARKANSAS SCHOOL FUNDING

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					School Reform and School
  Funding in Arkansas
           Spring 2006




                         Office for Educational
                                 Policy
                         University of Arkansas


  Gary Ritter                               May 2006
Overview

• What is OEP?
• Overview of Education Policy
• What is Lake View?
  – Historically and Today
• How are schools funded?
  – Nationally and Arkansas
• Recent reforms in AR
  – Legislative Special Session
• What’s Next?
Who Are We?
  • OEP = one of many research and
    service units in COEHP
  • Housed in new Department of
    Education Reform
  • OEP Mission
    – to serve as a resource to aid state legislators,
      school board members, and other
      policymakers in thoughtful decision-making
      concerning K-12 education in the State of
      Arkansas.
    – In light of this mission, naturally, OEP has
      been following AR Ed Reform and trying to
      track resulting changes in state education.
Office for Education Policy

For copies of our previous newsletters,
    working papers, and all other OEP
      research, check out our website:
          http://www.uark.edu/ua/oep/



     202 Graduate Education Building
                      479.575.3773
AR Ed Policy Context
 • Why is the state in constant
   reform?
   – Lake View Litigation and Decisions
   – 2001, 2002, 2004, 2005?
 • What did the AR legislature
   enact?
   – District Governance (consolidation)
   – Increased funding ($650M in 2 yrs)
   – Increased accountability (Act 35)
 • Always Hovering – NCLB!
History: Lake View Decision

• According to the Supreme Court
  Ruling:
  – Arkansas has neglected to ensure an
    “adequate” education.
  – Neglected to ensure equitable
    spending across the state
• Required major increases in state
  resources allocated to education
  – Funding must be based on need
    rather than availability of funds
Lake View leads to a question

• What level of government is responsible
  for providing education?
• How much education funding is
  undertaken by ….
  – Federal ? ___
  – State ? ___
  – Local ? ___
• How much do you think we spend per
  student in Arkansas?
Funding Sources for US
Schools

   Percent of Revenue: Various Levels of
          Government, 1920-1995

  100%                        % Federal
   80%                 % State
  60%
  40%
                       % Local
  20%
   0%
     1920 1930 1940 1950 1960 1970 1980 1990 1995
Education Policy

• Education is a …
  – State Responsibility (~ 45%)
  – Local Function (~ 45%)
  – Federal Interest (< 10%)
• In general, improved teaching and
  learning is at the heart of coherent
  education policy, but …
State Role

• Since the mid-19th Century, the role
  of the state was to maintain equity
  and set minimal level of access
  standards.
• States provide additional funds to
  compensate for an individual
  community’s ability to pay.
• States must also ensure that
  teacher education programs are
  adequate.
Local Role

• Organize, manage, hire & fire, and
  decide pedagogy and curriculum
• States are now trying to devolve power
  directly to schools rather than to districts
  for greater accountability
• Localities use school boards to make
  decisions (schools boards are non-
  partisan)
   – In cities, school boards are appointed. In
     rural areas, they are elected. And education
     is the only service where voters vote on a
     budget.
Federal Role

• Historically, Federal role in education
  has been very small
• Federal government was forced to
  become involved due to …
   – Neglect of certain kinds of students
   – National issues such as defense and
     manpower
   – Research, evaluation, and statistics needs
             School Reform and
                Litigation in
                 Arkansas

The Lake View Case and the Special Legislative
             Session of 2003-04

                 EDFD 5683
         Issues in Educational Policy
Timeline of School Reform
• 1979: Alma School District & 10 other districts file lawsuit
  over school-funding formula.

• 1983: Arkansas Supreme Court strikes down state's
  public school-funding formula.

• 1984: State raises sales tax by 1¢ to help fund public
  education.

• 1992: Lake View School District sues state over
  disparities in school funding.

• 1994: Pulaski County Chancery Court Judge rules in
  favor of Lake View, finding finance system violates
  education adequacy & equity provisions of state
  constitution.
1994 Findings of the
Court
 • No rational basis for the disparity
   among poor and wealthy school
   districts
 • System violated Article 14, Sec. 1
   (Education Article) of AR Constitution
   by failing to provide a “general,
   suitable and efficient system of
   free public schools.”
 • System violated equal protection
   provisions
Timeline of School Reform
 •   1995: State enacts bill giving money to districts equally on a
     per-student basis.

 •   1996: Voters approve Amendment 74, requiring all districts to
     have at least 25 property tax mills for schools.

 •   2000: State Supreme Court sends Lake View case back to
     Pulaski County Circuit Court.

 •   May 2001: Pulaski Chancery Court Judge declares funding
     system inequitable & inadequate and orders state to fund
     preschool.

 •   Nov. 2002: State Supreme Court upholds Pulaski Chancery
     Court's ruling & sets Jan. 1, 2004, deadline for Legislature to
     comply; overrules decision on preschool funding.

 •   Sept. 2003: Consultants issue school finance adequacy
     report calling for nearly $850 million in new spending.
Chancery Court – Lake View
vs. Huckabee
• Trial lasted from September 18,
  2000 to November 1, 2000
• 188 school districts intervened to
  support the State and present
  funding system
• They covered issues such as:
  – Equity – the funding issue
  – Adequacy – the compliance issue
  – New Facts
 Called back into court

• 2000 - For 19 days in September
  and October, Pulaski County
  Chancellor Collins Kilgore conducts
  the Lake View trial at which 36
  witnesses testified. The court
  record totaled 20,878 pages.
2001 Chancery Court Ruling
(May 25)

• Judge Kilgore rules the state’s education
  system to be inadequate and inequitable.
   – Facilities: Provide substantially equal buildings
     properly equipped and suitable for instruction of
     students.
   – Teacher Salaries: No deficiency in our
     education system is in more urgent need of
     attention than teacher salaries.
   – Pre-School Programs
   – Funding based on need not on available funds.
• Awards $9 million to the Lake View
  lawyers.
Highlights of the Supreme
Court Ruling
• Supreme Court affirmed the
  lower court’s ruling
• Exception - Pre-School
  Programs
• State has until January 1, 2004
  to correct the problems
• Results – adequacy study and
  consolidation debate
   Huckabee’s Response

   • Although Huckabee opposed
     Kilgore’s ruling, he embraces the
     Supreme Court ruling, saying,



“The Supreme Court has clearly ruled that
the education funding system in Arkansas I
due for a total revamping. I think we’ve
got our work cut out for us.”
Huckabee’s Plan for School
Consolidation

• 2003 - JAN. 14: In his State of the State
  address, Huckabee announces his plan
  to:
   – Consolidate Arkansas’ 310 – now 308 –
     school districts into between 107-116
     districts.
• Districts fewer that 1,500 students
  would be consolidated unless they
  could meet standards.
• He would also make superintendents
  state employees, a provision he later
  drops.
Huckabee’s Pledge



“We should not, and I pledge to
    you we will not, accept a
 second-class education for our
children that will doom them to
permanent poverty in this state,”
   Huckabee tells legislators
Heated Debate

 • 2003 - FEB. 3: Huckabee releases a
     103-page draft of his education bill. He
     says if the Legislature refuses to pass it,
     he may seek a petition drive to allow the
     people to vote on it.
 • FEB. 5: About 700 anti-consolidation
     parents, educators, and students rally at
     the state Capitol. One speaker likens the
     consolidation to terrorism because
 “it knocks out our nation
 a little bit at a time.”
Legislature Adjourns
 • 2003 – APRIL 2: Rural educations reject
   a compromise from Huckabee, calling the
   offer insignificant because he didn’t move
   on the 1,500 enrollment figure.
 • APRIL 16: The Legislature adjourns. The
   only significant education reform bill that
   passes is the Omnibus Quality Education
   Act.
    – It requires the state Board of Education to
      annex, consolidate, or reconstitute any school
      district in fiscal distress for two consecutive
      years.
    – Some rural legislators said they didn’t
      understand it when they voted for it.
Special Legislative Session

• 2003 – DEC. 3: Huckabee calls
  special legislative session to start
  Monday, Dec. 8th.
Main Focuses of Special
Session
 • Consolidation of Schools
 • Student Assessment and
  Educational Accountability
• Equitable Funding Formula
Lawmakers’ Response

• Special Legislative Session 2003 on Education
   – Act 35 – student accountability and assessment
   – Act 60 – consolidation
   – Act 107, Act 94 – increase sales tax (5.125% -
     6.000%)
   – Act 74 – teacher salaries
      • $27,500 - bachelor's degree, no experience;
      • $31,625 - master's degree, no experience
      • Annual incremental pay increases for teaching
        experience, offered for at least 15 years:
          – $450 annually for bachelor's level teachers,
          – $500 annually for master's level teachers.
 Senate Bill 42
– Foundation funding amount will be
  equal to $5,400 times the average daily
  membership of the previous year.
– Each district will receive additional
  funding for education categories
  including students enrolled in an
  alternative learning environment,
  secondary vocational areas, English
  language learners, national school
  lunch, other approved programs, and
  professional development.
 New Funding Formula

• Act 69, Act 108, Act 57 – funding changes
   – $5,400 per student in base funding;
   – Supplementary funding for specialized needs:
      • $3,250 per student - alternative learning programs ;
      • $195 per student - English language learner;
      • Low income students
          – $480 per student in districts where less than 70% of
            students qualify for free and reduced school lunches;
          – $960 per student in districts where 70% to 90% of
            students qualify for free and reduced school lunches;
          – $1440 per student in districts where more than 90% of
            students qualify for free and reduced school lunches;
            and
      • $50 per student for professional development
District Consolidation – Act 60
• Special Legislative Session of 2003-04:
   – School districts with fewer than 350 total students
     for 2 consecutive years must merge
     (administrative)
   – First option is voluntary merger
   – No school mergers in year 1


• Results:
   –   57 districts targeted for consolidation
   –   2003-04 = 308 districts
   –   2004-05 = 254 districts
   –   Post 2004-2005 = 11 high schools within merged
       districts were closed
      Student Assessment and
     Educational Accountability
•   Senate Bill 33
     –   Submitted by Senator Steve Bryles-D
     –   Would increase standardized testing of students while comparing scores to
         those of students nationwide.
     –   Students not meeting proficiency standards would be identified for
         intervention.
     –   Schools would be required to publish annual reports containing school
         performance and demographic information.

Accountability Regulations require:
•   Both curriculum-based exams (ACTAAP) and nationally norm-
    referenced exams (ITBS)
•   Schools rated for (1) Absolute performance level, (2) Score growth,
    and (3) Fiscal management
•   Consequences for schools unable to meet standards (i.e., recent
    takeover in Helena)
•   NCLB must be integrated with state-level rules
•   Too early to talk about results
Timeline of School Reform

•   Dec. 2003: Legislature convenes special session to address
    school finance concerns.

•   Jan. 2004: Lake View District asks state Supreme Court to
    hold state in contempt for failing to comply with Lake View
    ruling; Supreme Court agrees, retaking jurisdiction of case &
    appointing 2 Special Masters to evaluate compliance.

•   Feb. 2004: Legislature increases school funding by more
    than $400 million for 2005, sets new funding formula, and
    consolidates districts that have fewer than 350 students for
    two consecutive years.

•   June 2004: Supreme Court takes itself out of case, citing
    satisfaction with current work & concerns over separation of
    powers.

•   Nov. 2004: Consultants assess over 6,000 school buildings
    in state and find $2.3 billion in immediate needs.
Understanding Education
  Funding … in US & AR
School Finance Formulas
Policy Goals

• Reduce disparity in expenditures
• Compensate for variance in local
  fiscal capacity
• Allow for local fiscal decision-
  making
• Constrain costs
• Gain political support
• Promote efficiency and
  effectiveness
       State Equalization

                                    Cost of     = amt.
6000                               Education?   Legislature
                                                feels like
5000                                            giving/number
                                                of kids
4000
                                                State Share
3000
                                                Local Share
2000

1000

  0
       A   B   C   D   E   F   G   H   I   J
Part 1: How is money
generated?
• Before the 2003 Adequacy Report,
  Arkansas simply took the total amount of
  money for education and divided it by
  the number of students.
  – For example, the 2001-02 funding formula
    was:
     • Total amount of local revenue, plus total amount
       of state revenue, divided by number of students…
        – $584 million (local) + $1.5 billion (state) = $2 billion
        – $2 billion / 446,000 students = $4,638.66 per
          student
Part 1: How is money
generated?
• Local Revenue
  – Step 1: Assessed Valuation
     • The property value of resident’s within the district
       (total assessed valuation) is computed.
  – Step 2: Collection Rate
     • The state believes that not all of the money will be
       collected, so only 98% of the assessed value is
       requested.
  – Step 3: Tax Rate
     • The 98% assessed value is multiplied by the state
       uniform tax (maintenance and operation) rate – 25
       mills
  – Step 4: Total Local Revenue
     • Assessed valuation * 98% * .025 = total local
       revenue
Part 1: How is money
generated?
• State Revenue (pre Act 59):
  – Step 1: Miscellaneous Funds
    • 75 % of the statewide miscellaneous
      funds for the previous year is allotted to
      education
  – Step 2: Equalization Aid
    • Based on existing requirements the state
      provides a certain amount of money for
      education.
Payments pre- Act 59
                Total State Equalization
                     Aid $                            State

                Total Assessed Valuation           23,849,287,688
                        multiplied by

                98% Collections Rate                   0.98
State Devised   Assessments Collected          $   23,372,301,934

                Uniform Tax Rate (M&O) 25
PP Funding           mills                               0.0250

                Local Receipts Overall         $     584,307,548
Amount
                75% Statewide Miscellaneous
                 Funds from Prior Year         $       5,689,596


                PLUS: State Equalization Aid   $    1,479,228,639

                TOTAL Funding Dollars          $    2,069,225,783

                Divided by: ADM                         446,083

                Base Local Rev PP
                     (Foundation)              $        4,638.66
      District Distribution (pre- and Post- Act 59)


                    Total Assessed Valuation              $583,919,868

                    Times: 98% Collections Rate              0.98
Example =           Assessments Collected             $      572,241,471

Fayetteville        Uniform Tax Rate (M&O) 25 mills                 0.0250
                    Local Receipts Overall            $       14,306,037
2001-2002
                    75% Statewide Miscellaneous
                     Funds from Prior Year            $        2,371,061
                    EQUALS: Total Local Revenue       $       16,677,098
                    Divided by: Local ADM                            7,710
                    EQUALS: Local Revenue PP          $              2,163
                    Then: SEFPS = BLRPS - LRPS        $          2,475.61
Part 2: How much money should be
given to schools?

• According to the Adequacy Study, the
  amount of money needed to adequately
  educate a “regular” student is $5,356 per
  pupil
• The 2003 Arkansas General Assembly
  rounded this number and required
  regular student funding to be $5,400 per
  pupil
• This “adequate” amount is based on a
  set of assumptions and calculations
  regarding the personnel and size of the
  school district.
Part 2: Costing Out an Adequate
Education
• $3,415 per student is based on personnel
  factors:
   – Personnel ratios
      •   20:1 Kindergarten
      •   23:1 Grades 1-3
      •   25:1 Grades 4-12
      •   2.9 Special Education teachers per 500 students
      •   2.5 Instructional Facilitators per 500 students
      •   0.7 Librarian/Media Specialist per 500 students
      •   2.5 Guidance Counselors per 500 students
      •   1 Principal per school
   – Salaries
      • Average rate for 25 teachers & 9 staff members is
        $48,750, which is $1,635,675 per school.
      • Average principal salary is $71,837
      • Total School Salaries = $1,707,512 divided by 500 =
        $3,415 per pupil
Part 2: What is the magic “adequate”
number?
• More Assumptions: School Size (n=500)
   – 8% Kindergarten students (40 kids)
   – 23% Grade 1-3 students (115 kids)
   – 69% Grade 4-12 students (345 kids)
• Other school factors and costs per student = $789 per
  pupil
   –   Teacher contract for 5 additional days ($101)
   –   Technology ($250)
   –   Instructional materials ($250)
   –   Extra teacher duty ($60 middle school; $120 high school)
   –   Supervisory Aids ($35)
   –   Substitutes: 10 days/teacher * $121 per day / 500 students
       ($63)
• Carry Forward: Administrative Costs, Equipment, Legal,
  Athletics, Food, Operations, etc. = $1,152 per pupil
Magic Number

         3,415 +
          789 +
         1,152 +

    = $5,356 per pupil
        Or, $5,400
 Part 2: How should ADDITIONAL
 money be Distributed to schools?
• The Adequacy Report also outlined additional
  resources for students:
   – National School Lunch (NSLA) eligible students:
      • 1 teacher per 100 NSLA students
      • Concentration funding:
          – $480 for schools with less than 70%
          – $960 for schools with 70% - 90%
          – $1,440 for schools with more than 90%
   – English Language Learners (ELL)
      • 0.4 teachers per 100 ELL students ($195 per student =
        $48,750*.4/100)
   – Alternative Learning Environment (ALE) students
      • 1 teacher per 15 ALE students ($3,250 per student =
        $48,750/15)
   – Professional Development
      • $50 per student
Arkansas Education Funding

• Previously, the Arkansas education
  funding formula relied on distributing
  existing local and state revenue to
  students.
• Now, with court ordered reforms,
  Arkansas’ education funding formula
  must provide:
  –   $5,450 per regular student (includes PD)
  –   $5,930 - $6,890 per NSLA student
  –   $5,745 per ELL student
  –   $8,700 per ALE student
    Where’s the Money? An Evaluation
    of the Dramatic Increases to School
            Funding in Arkansas


 Joshua H. Barnett,
University of Arkansas

   Gary W. Ritter,
University of Arkansas



American Educational Research Association, San Francisco, CA   April 2006
History: Court Challenges
 • According to the Arkansas Supreme
   Court Ruling in Lake View v
   Huckabee (2002):
   – Neglected to ensure an adequate
     education for all students.
   – Neglected to ensure equitable spending
     across the state.
 • Court required major increases in
   state resources allocated to
   education
   – Funding must be based on need rather
     than availability of funds
   – Make education a “top priority”
Research Objectives &
Methods
 • RO 1: Pre-reforms
   “How were we doing before the increase?”
    – What was the adequacy of school funding in
      Arkansas and how did it compare to other states?
    – What was the equity of school funding in Arkansas
      and how did it compare to other states?

 • Method: Pre-reforms
    – Adequacy
        • Examine per pupil expenditures and teacher salaries
    – Equity
        • Examine the Federal Range Ratio and spending
          difference between highest-poverty and lowest-poverty
          districts
       Research Objectives &
       Methods
• RO 2: Post-reforms
  “Where did the money go?”
   – Has funding increased overall?
   – Are funds changing in certain types of districts?

• Method: Post-reforms
   – Divide districts into deciles based on district characteristics
     – size, wealth, percent NSLA, percent non-white, student
     performance
   – Examine deciles with regard to expenditures, teacher
     salary, and categorical funding for students
RO1: Adequacy - Expenditures

                                                     Adjusted
                 1959-    1979-     1999-    2002-     2002-
                  1960     1980      2000     2003      2003
Arkansas         $225    $1,574    $5,628   $6,482   $7,333
Louisiana        $372    $1,792    $6,256   $6,922   $7,700
Mississippi      $206    $1,664    $5,356   $5,792   $6,612
Missouri         $344    $1,936    $6,764   $7,495   $8,328
Oklahoma         $311    $1,926    $5,770   $6,092   $6,978
Tennessee        $238    $1,635    $5,521   $6,118   $6,859
Texas            $332    $1,916    $6,161   $7,136   $8,027
US Average       $375    $2,272    $7,392   $8,044   $8,044
US Avg. - AR    $-150     $-698   $-1,764   $1,562    -$711
AR Rank of 51
   (high=1)        49       51        48       42         35
RO1: Adequacy – Teacher Salary
American Federation of Teachers, Survey and Analysis of Teacher Salary Trends,
2002

                       Average                                      Adjusted
                        Salary         Average        Average       Average
                         1991-           Salary         Salary        Salary
 State                      92         1997-98        2002-03       2002-03
 Arkansas              $27,168         $30,987        $36,026       $40,733
 Louisiana             $26,411         $28,347        $36,328       $40,390
 Mississippi           $24,368         $27,662        $33,295       $38,025
 Missouri              $28,923         $33,143        $36,053       $40,040
 Oklahoma              $26,514         $30,187        $32,870       $37,646
 Tennessee             $28,621         $34,267        $38,515       $43,172
 Texas                 $29,719         $32,426        $39,230        $44,110
 US Average            $34,213         $38,436        $44,367       $44,367
 US Avg. – AR          -$7,045          $7,449        -$8,341        -$3,634
 AR Rank
 of 51 (high=1)               42             44              46            35
RO1: Equity Measures
                                      Gap between revenues
                                  available per student in the
                Federal Range   highest- and lowest- poverty
State           Ratio 2002-03               districts 2002-03
Arkansas                 0.62                             $24
Louisiana                0.40                           -$715
Mississippi              0.62                            -$37
Missouri                 0.72                             $22
Oklahoma                 0.99                            $121
Tennessee                0.49                            $530
Texas                    1.02                           -$588
US Average               1.69                           -$907
AR Rank of 49
States (most
equitable=1)              23                               18
RO1: Equity Measures

 • In 2004-05, the Federal Range Ratio was
   0.597, a reduction from 0.62 in 2002-03.

 • In 2004-05, the gap between the lowest-
   and highest- poverty (based on FRL)
   districts was:
    – Highest-poverty quartile of districts = $7,794
    – Lowest-poverty quartile of districts = $6,548
    – Difference between highest- and lowest-
      poverty districts indicates that the highest-
      poverty districts receive $1,246 more per pupil
      compared to the lowest-poverty districts.
RO1: Pre-Reform Summary

• Adequacy – comparatively spending
  fewer dollars than other states and
  paying teachers less.
• Equity – comparatively distributing our
  resources equally.

So… pre-reform there was reason for
  concern. The state made some
  changes, where did the money end up?
RO2: Overall Per Pupil Revenue
Change
                          2003-04    2004-05      % Change
Category                   Actual     Actual   03-04 to 04-05
Average Daily
  Membership             447,872    450,910              1%
Revenue Per Pupil:
 Local Revenue            $2,245     $2,436             9%
 State Revenue (total)    $3,869     $4,733            22%
 State Revenue (NSLA)         $0      $383              NA
 State Revenue (ALE)          $5        $42           740%
 State Revenue (ELL)          $4         $8           100%
 Federal Revenue           $997      $1,049             5%
 Total Per Pupil
  Revenue:                $7,110     $8,902            25%
    RO2: Overall Per Pupil Spending
    Change

                              2003-04   2004-05    % Change
Category                       Actual    Actual 03-04 to 04-05
Expenditures Per Pupil:
 Instruction                   $3,706    $4,604          24%
 Instructional Support          $242      $395           63%
 Pupil Support                  $240      $325           35%
 Site Administration            $327      $414           27%
 Central Administration         $310      $304            -2%
 Maintenance & Operations       $567      $676           19%
 Food & Other                   $336      $388           15%
 Total Current Expenditures    $6,113    $7,489          23%
RO2: Disadvantaged Student
Changes?

    Current Expenditures Per Pupil (without
               transportation)
Student Group       2003-04   2004-05    Change

All Students         $6,045   $7,218    + $1,173

NSLA Students        $5,893   $7,379    + $1,486

Non-White            $6,372   $7,912    + $1,540
Students
                   RO2: Where did the money go?
                   Current Expenditures (minus transportation) by Assessed Valuation
                   Per Pupil
                   $10,000



                    $9,000
                                                                                             The red
                                                                                             line has
                    $8,000
                                                                                             “flattened”
                                                                                    $7,484
    2003-04                                                                                  and
    2004-05         $7,000                                                                   resources
    2005-06 B                                                                       $6,612
                              $6,743                                                         distributed
                    $6,000                                                                   more
                                                                                             evenly by
                                  $5,715
                                                                                             wealth
                    $5,000


10 Decile Groups
                    $4,000
                             G1      G2    G3   G4   G5   G6   G7   G8   G9   G10
                     Low Wealth                                          High Wealth
                   RO2: Where did the money go?
                    Current Expenditures (minus transportation) by Percent of NSLA Students

                   $9,000

                   $8,500
                                                                                     $8,166
                   $8,000

                   $7,500                                                                     Districts




                                                                         Increase
                   $7,000
                                                                                              with more
      2003-04
                                                                                     $6,493
                                                                                              NSLA
      2004-05      $6,500
                             $6,457
                                                                                              students
      2005-06 B
                   $6,000                                                                     have more
                                                                                              resources
                   $5,500
                             $5,439                                                           and more
                   $5,000                                                                     new
                   $4,500
                                                                                              resources
10 Decile Groups
                   $4,000
                            G1   G2   G3   G4   G5   G6   G7   G8   G9         G10

                   27% NSLA                                              87% NSLA
RO2: Disadvantaged Student
Changes?
• More disadvantaged districts receiving more
   – Lowest wealth districts increased by 22%
     (High Wealth 10%) – measured by property value
   – Highest poverty districts increased by 23%
     (Low Poverty 19%) – measured by percent FRL

• We find that targeted funds went to:
   –   Districts with more NSLA students
   –   Districts with more non-white students
   –   Districts with more students struggling in ACTAAP
   –   Districts with declining enrollments
 Conclusions

• RO1: Pre-reforms
  – Even after adjusting for COL, Arkansas spends
    among the lowest states on education per pupil
    and has low teacher salaries. Comments
    about inadequate funding may be valid.
  – Arkansas appears to be in the top ½ of states
    with regard to equity. Comments regarding
    inequitable distribution may be unwarranted.

• RO2: Post-reforms
  – Overall funding increases
  – Targeted increases for disadvantaged students
  – Questions remain…
Recent Litigation in Arkansas

              Update of Current
                 Reforms
Timeline of School Reform

•   April 2005: Legislature sets aside $104 million to improve
    facilities but delays an increase in base school funding
    level.

•   April 2005: 49 districts request State Supreme Court to
    reopen Lake View case over lack of base funding increase.

•   June 2005: State Supreme Court agrees and reappoints
    Special Masters to take testimony and issue report by
    October 1, 2005.

•   Oct. 2005: Special Masters issue report calling for
    increased funding.

•   Dec. 2005: Supreme Court concurs with Special Masters;
    demands that legislature make reparations by January
    2007.
After the Study: The Magic $5,400

• After the adequacy study and the state’s
  reforms in 03-04 related to funding,
  accountability, and consolidation ….
• In January 2004, the Arkansas Supreme
  Court recalled its mandate in Lake View
  and appointed Special Masters to review
  what the Legislature had done.
• Both the Special Masters and the Court
  blessed the actions of the General
  Assembly and ended the case in June
  2004.
2005 Update

• Some changes were made to the funding
  formulae, but the base amounts of funding
  remained the same (magic $5400 plus).
• On the day that the General Assembly
  recessed, multiple school districts petitioned the
  Arkansas Supreme Court to recall its mandate,
  reappoint the Special Masters, and hold the
  State in contempt for not following the mandate
  in Lake View 2002.
• The Court did the first two.
2005 Update

• In the summer of 2005, some 40
  depositions were taken and two weeks
  of live testimony was done in front of the
  Special Masters.
• There were – among others – three main
  issues:
  – Non-compliance with Act 57
  – No increase in the basic levels of funding
  – New mandates on school districts that were
    not funded.
2005 Update

• The Special Masters ruled for the
  Plaintiffs on all issues.
• The Supreme Court concurred on
  December 15, 2005. But . . .
  – The Court did not define what or where basic
    funding levels should have been increased
    to,
  – Nor did the Court define what was or was
    not an “unfunded mandate.”
  – Nor did the Court explain how an Act 57
    Study could be accomplished without
    sufficient data.
2005 Update

• The December 2005 Supreme
  Court ruling offers little to no
  guidance as to what the State is
  supposed to do, other than that the
  State did not do enough in the 2005
  Regular Session.
Hot Topics in AR Education Reform
Key Questions

• Adequacy re-calibration study
  underway
  – Will we need to change funding every
    year?
  – Is this fair to other services?

• Are schools spending money
  effectively?

• How can we do this?
• THANKS!
District Consolidation
   • Which schools closed?

    Receiving School (m=366)        School closed (m=117)
 Greenland                     Winslow High
 Fouke                         McRae High
 Beebe                         Cord-Charlotte High
 August                        Holly Grove High
 Clarendon                     Grady Campus
 Star City                     Gould High
 Dumas                         Lake View campus
 Barton-Lexa                   Mt. Holly High
 Smackover                     Arkansas City High
 McGehee                       Bright Star High
 Cedar Ridge                   Cotton Plant High
High Schools Affected

  80   74
  70
  60
             48
                           46
  50
  40                               32        32    34

  30
  20
  10
  0
       % Poor         % Minority         % Pass Lit G11

            11 Closed HS        11 Receiving HS
District Consolidation
Challenges with data collection:
•   Incomplete data from ADE
•   Compiling lists through newspaper and online
    searches
Considerations:
•   Only high school level data is currently available
Future work:
•   New list of consolidated schools will be available
    October 1st from ADE
•   Comparing the schools involved in consolidation
    with state-wide averages
•   Policy brief on consolidation findings
Superintendent Survey

 • How are districts using new
   funding increase? Is new
   categorical funding making a
   difference?
 • Are superintendents satisfied
   with the quantity & quality of
   teachers hired over past 3
   years? How impacted by
   NCLB?
Methods & Challenges
•   Mailed surveys to 253 superintendents
•   Mix of quantitative (scaled) & qualitative
    (open-response) questions
•   Coded & analyzed qualitative data
•   Survey Challenges
    –   Low response rate: 34% (Representative? Short
        turnaround? Bad timing? Mailed vs. e-mailed?)
    –   Still following-up with non-respondents via e-
        mail & re-mailing surveys
    –   Handling missing data & interpreting results
    –   Don’t ask multiple-response questions!
Preliminary Results
                                                    Agree/
 To what extent do you agree with the following
                                                   Strongly
 statements?
                                                    Agree
 Nearly all teachers who apply to work in my        85%
 district are highly qualified.
 My district has adequate funding to attract        32%
 enough highly-qualified teachers.
 The current funding level in my district is        31%
 sufficient to provide an adequate education to
 all students.
 A performance-pay system would help attract        40%
 more highly-qualified teachers to our district.
 The school from which teachers receive their       25%
 degrees matters a great deal in our hiring.


          Potential problems with validity?
Qualified Applicants?
Does this differ by discipline?

  Our district is receiving an adequate number of qualified applicants for
  positions in the following subject areas:
 100%                                                                88%
 80%                            67%
 60%
                                                  40%
 40%
 20%         8%
  0%

        Math & science Language & social Special education        Elementary
                            studies                                education
Impact of NCLB?
How is the NCLB “highly-qualified
teacher” requirement affecting
teacher hiring in your district?
Positive                            10%
Negative                            32%
Mixed/Too soon to tell              13%
No impact                           39%


• Is this surprising?
Superintendent Comments
  How are you using new funding?

 Professional development                     38%
 Hiring new teachers                          33%
 Increasing teacher salaries                  31%
 Instructional materials                      24%
 Hiring other staff (i.e., reading coaches)   20%
 Other                                        14%
 No new funding/Not enough provided           9%
 Smaller class sizes                          8%
 New programs/classes                         7%
 Special needs students                       5%
Next Steps

• Adequacy re-calibration study
  underway

• Is more money appropriate or
  needed?

• Are schools spending money
  effectively?

• Arkansas Legislature is meeting
  now!

				
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