Higher Education

Study finds Michigan schools underfunded

Report shows K-12 schools are underfunded by nearly $2,000 per student.

February 9, 2018
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It is time to have a conversation about school funding.

That’s the consensus from members of the School Finance Research Collaborative, a group of 22 business leaders and education experts focused on changing the way Michigan schools are funded.

The collaborative recently conducted a study that identified key issues concerning public funding for Michigan K-12 education, most notably the state’s schools are underfunded, and disadvantaged students need additional funding to meet efficiency standards.

The 358-page report reflects school data and input from nearly 300 public and charter school educators throughout Michigan.

Augenblick, Palaich and Associates partnered with Picus, Odden, and Associates to lead the study. Additional researchers included national school finance experts Michael Griffith, Chris Stoddard and Jennifer Imazeki. The final study cost was $910,000, funded by organizations including the W. K. Kellogg Foundation, the C.S. Mott Foundation and intermediate school districts throughout the state.

An educational study of this depth was missing in Michigan and needed to most effectively help schools succeed, said Elizabeth Welch, an SFRC member, an East Grand Rapids Public School District board member and a Grand Rapids employment lawyer.

She said every state — such as Massachusetts, which is at or near the top in every subject of the most recent National Assessment of Educational Progress (NAEP) results — that made significant positive changes to its educational system began with a study like this.

One size does not fit all

Based on the findings, the funding for a regular-education K-12 student in Michigan should be $9,590, not including transportation, food service or capital costs, and only includes pension costs at 4.6 percent of wages.

The state’s current base per-student allocation is $7,631 in more than 75 percent of public schools and all charters, according to Michigan’s 2017 K-12 education budget overview, with a “relatively small” amount of additional dollars for at-risk students and a “very small” amount for English language learners, according to Ron Koehler, SFRC member and an assistant superintendent for the Kent Intermediate School District.

The current “one-size-fits-all” funding method is not working, Koehler said.

The study results argue that some children — such as those with special education needs, English language learners and students living in poverty — need more resources to be successful in school.

That confirms what educators already knew, Welch said, but now the data can help determine how to improve.

According to the report, children beginning lessons in English as a Second Language need about 70 percent more funding than the $9,590 base. Those who score higher on English assessments need 35 percent more until they achieve proficiency.

Special education students need more funding, with mildly impaired students requiring 70 percent more funding and the moderately impaired requiring 115 percent more, it said.

The federal government is supposed to pay 40 percent of special education mandate costs in accordance with the Individuals with Disabilities Education Act established in 1975, though only 16 percent of the cost is reimbursed at this point, Koehler said.

A study released in 2017 by Michigan Lt. Gov. Brian Calley found special education in Michigan schools is underfunded by nearly $700 million, equating to a shortfall of $459 for every student in the state.

The SFRC study also found economically disadvantaged students require 35 percent more resources to achieve proficiency. That’s because many of them are “developmentally delayed” or may “not have the same resources at home,” Koehler said.

Researchers also concluded schools serving fewer than 1,000 students should receive nearly $2,000 more per student, because under current policy, smaller schools do not receive adequate funding.

Career and technical education students require $10,000 more per classroom for specialized resources and training materials, the report said.

Though the study did not focus on preschool, it suggested an adequate program for 3- and 4-year-old students would cost $14,155 per child.

What is best for students?

Without proper funding, there are a number of resources students may miss, said Teresa Weatherall Neal, SFRC member and superintendent of Grand Rapids Public Schools. That could include updated curriculum and technology, quality teachers, maintained buildings, individualized learning and small class sizes.

“All of that affects student learning,” Weatherall Neal said. “When I made the decision to put a million dollars in our student data system, that’s a million I had to take from somewhere else.”

Koehler said the report suggests classes consist of roughly 20 students, though it notes some schools may not have the physical space for small classes.

“One of the big things that I don’t think we recognize is simply the difficulty to give students the attention they need in a large class size,” Koehler said.

The study focused on educational needs for public and charter students, and their costs are considered the same in this study, Koehler said, though traditional public schools bear transportation costs and approximately $1,300 per student in unfunded pension liability for school employees, which are not required or provided by most charter schools.

While researchers said transportation issues need further study — along with district costs, literate and illiterate poverty, and concentration of poverty by district — they concluded schools that provide transportation should receive additional funding of $973 per student until then.

While some schools — public schools versus charter schools, in particular — may compete with one another to enroll students and therefore receive additional funding, Weatherall Neal said it is important to put that aside and focus on what is best for the students.

“It’s not about traditional charter or traditional public. It is about what is it going to take for Michigan to be the best,” Weatherall Neal said.

“I think that when we can no longer hold a conversation respectfully, then we’ve already lost. I want people to be able to come to the table and not pit these children and districts against each other.”

Welch echoed that sentiment.

“It doesn’t matter where that child lives, I want that child to have the same opportunities as my children,” she said.

The end goal

Koehler said the purpose of the study was not for educators to simply ask for money; it was meant to take a closer look at how to meet educational standards and reduce the decline in performance.

However, Welch said, “some money does matter.”

“There has been a drop in scores that does correspond to cuts in the budget,” she said.

An analysis in 2017 of NAEP results by University of Michigan professor Brian Jacob shows Michigan is the only state where proficiency rates continually declined between 2003 and 2015, and the state’s students ranked 41st in proficiency.

The Business Leaders for Michigan 2017 benchmark report ranked Michigan 46th in fourth-grade reading level, 37th in eight-grade math, 42nd in career and technical education enrollment, 29th in college and career readiness and 30th in higher education attainment.

“And as a result, we have below average per capita income in this state,” said Doug Rothwell, BLM president and CEO, in a segment with National Public Radio affiliate WGVU.

The collaborative is in the process of meeting with legislative leaders and business community leaders to discuss the report and “talk about a way forward,” Koehler said.

“Other states around the country have done this, so there’s no reason why we can’t at some point get there,” he said.

As far as reaching those goals, Welch said it depends on who voters put in office, but she hopes for bipartisan support in driving policy based on key findings.

Tyler Sawher, senior strategy adviser to Gov. Rick Snyder for education and career connections, was briefed by the collaborative on the results, among others.

In response to the study, Anna Heaton, the governor’s press secretary, pointed to Snyder’s Feb. 7 budget proposal, which included the largest funding increase in 17 years: a $240-per-student increase for school districts that get the minimum funding and a $120-per-student increase for higher-funded schools.

Koehler said any dollar increase is welcome, but the governor’s latest action does not address the “one size fits all” issue.

“While we applaud the governor and we very much appreciate his action, we want to work with him and the legislatures to address inequities in our system,” Koehler said.

Whatever the solution, the collaborative agrees the effort will not be a “quick fix,” as Weatherall Neal put it.

“We don’t have all the answers, but at least we’re having the conversation, and that’s what I love about it,” Weatherall Neal said.

Only about 20 to 25 percent of Kent County residents have children in school at this point, Koehler said.

With a declining pool of talent in Michigan, he said it’s important to make sure the state’s students are prepared for college or the workforce.

“We’ve got to raise public awareness of the severity of the problem, the crisis that we face if we don’t deal with it,” Rothwell told WGVU. “Companies in Michigan are going to grow. If they can’t fill those jobs here, they’re going to do it somewhere else. We don’t want to see that happen.”

Rothwell said the state needs to make decisions about education and sustain them in order to see improvement.

He told the Business Journal BLM plans to issue a report next month “identifying best practices used in other states achieving stronger education performance than Michigan and a set of policy principles” the group believes can close that gap.

“What we can see by the economy we’re in is that businesses need 100 percent of our graduates, and they need 100 percent of our graduates to be prepared,” Koehler said.

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