School funding has to balance with the rest of the budget

“We have to fund education by starting from what’s needed, rather than how much money is available.” As education dominates this year’s legislative session, that’s the brilliant insight we hear quoted repeatedly. As if nobody ever thought of that before.

The legislature is under pressure from the recent Yazzie-Martinez court decision, which requires the state to fund education adequately but doesn’t spell out what that means. The real pressure, however, is a widely shared desire to do better for New Mexico’s children.

New Mexico already spends more on education than almost anything else. In past decades, K–12 education accounted for about 50 percent of the general fund budget. Another 17 percent or so went to higher education, totaling two thirds of the general fund. Most departments of state government were funded out of what was left.

Then along came Medicaid, which has gradually expanded into the monster that ate the budget. Medicaid has been a benefit, helping make medical care accessible to people who need it. But it disrupted old assumptions about the budget. This year’s state contribution to Medicaid is expected to approach $1 billion. Count that, fix some badly neglected roads, do a few urgently needed things like decent pay for prison guards, and there goes your surplus.

Forty-five years ago New Mexico became a national model for how to fund education. Our approach was revolutionary in 1974 and is still held in high regard.

Before 1974, New Mexico funded public schools with local property taxes. Many states still do that. But New Mexico has very rich counties and very poor counties, causing huge disparities in education funding.

New Mexico found a better way. Property taxes and other sources still provide part of public school funding, such as bond issues for infrastructure. But operational money comes from the state general fund through the State Equalization Guarantee, or the funding formula.

The formula starts with the principle that every student in every district should get the same amount of money. Count the total number of students statewide, use the budget process to decide how much money will be available, then divide to determine how much is allocated for each student. Distribute the money by counting the students in each district.

The base value was that each student equalled one “program unit.”

It was determined that high school students cost more than fourth graders. So a high school student became 1.2 program units instead of one. The lowest grades cost even more and were assigned 1.4 units each. Special education is even more costly, so there’s a factor for it.

Another factor, the training and experience index, was to help districts pay higher salaries for experienced teachers and encourage advanced degrees.

Over time, the formula has become more complex as legislators introduced new factors based on the needs of their districts. The numbers have changed, but not the basic process.

A factor was added for the extra cost of small elementary schools in rural communities. Small charter schools in larger districts received funding under this this factor. Legislation this year proposes a revision so that only small rural schools qualify. Naturally, charter schools object.

Changes in the formula this year can be expected to respond to the court decision. Most likely to see increases are “at-risk” districts, especially those with large Native American populations.

Certainly we’re not satisfied with our school systems. The Richardson tax cuts and Susana Martinez’ refusal to increase any taxes have not helped. But I don’t think our legislators have ever been complacent about education spending.

The budget has always been an attempt to balance education needs, other government needs, and how much legislators think New Mexico taxpayers can pay without harming the economy. Regardless of the court decision, that balance will have to be preserved in the final budget numbers.

Triple Spaced Again, © New Mexico News Services 2019

 

 

 

 

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