DESE funding push has MoDOT parallels

JEFFERSON CITY, Mo. -- In requesting an $820.2 million budget boost for the Department of Elementary and Secondary Education in the next fiscal year, state education commissioner Dr. Kent King says the agency is simply conveying the message that Missouri is lagging behind in its financial commitment to public schools.

"We would be surprised if it is fully funded," King said. "But if we don't share that number and make it part of our agenda, we fear nobody else will."

DESE's request is reminiscent of claims state transportation officials made in recent years that at least another $1 billion annually is needed to provide the road and bridge improvements Missourians demand.

The Department of Transportation, like DESE, objectively quantified its needs. However, the sticker shock that resulted contributed to a public backlash against the department and last year's voter rejection of a $483 million tax package.

Although Missouri's transportation needs haven't changed, MoDOT officials no longer actively tout the $1 billion figure.

Showing the gap

Pat Goff, MoDOT's chief operating officer, said that amount was never part of a formal budget request but was an attempt to show the huge gap between project expectations and available revenue.

"We continue to talk about that gap, but we've turned it around a little bit and said, 'Here's what you get with existing resources,'" Goff said.

Spending on education and transportation are arguably the two most important areas of the state budget to most Missourians, and the consensus among policy makers is that both are woefully underfunded.

But in crafting the budget for the fiscal year beginning July 1, lawmakers must first fill a projected $1 billion hole caused by the reliance on one-time funds in the current budget and growth in mandatory spending programs such as Medicaid.

With no new funding sources on the horizon and the state's other departments enduring cuts, it is nigh impossible either department will see a substantial budget increase in the foreseeable future.

18 percent higher

DESE's $5.37 billion request for the coming fiscal year is nearly 18 percent higher than current year appropriations.

The department based its request on what it would take to fully fund the complex formula for distributing basic state aid to local schools plus other areas outside of the formula, such as bus service and special education.

Because the formula is tied to statewide property values, which are always increasing, the amount of money required to achieve full funding likewise grows annually.

According to lobbyist Jim Moody, a respected expert on the state budget, per-pupil education spending grew an average of 13 percent a year from 1993 to 2003, a rate he says wasn't sustainable. For example, in fiscal year 2000 lawmakers increased DESE's budget by nearly $309 million when state general revenue grew by a mere $5 million dollars.

"We were giving them money we didn't have," Moody said, adding that the state is now being forced to scale back education spending.

DESE submitted its request to Gov. Bob Holden, who will consider it when crafting the proposed state budget he will present to the legislature in January.

State Rep. Carl Bearden, the House budget chairman, said it is appropriate for DESE to publicize how much full funding would cost. However, he said making an unreasonable request in light of the state's financial circumstances could hurt the agency's standing among lawmakers.

"It is one thing to say where they should be based on the formula," said Bearden, R-St. Charles. "It is another thing to ask for something that is highly unlikely. It isn't a wise request, and it damages their credibility."

However, Bearden said lawmakers will make every reasonable effort to improve education funding and at the very least attempt to restore DESE's budget to the level approved for the current fiscal year. That would require replacing the $190 million Holden withheld from the department to keep the overall state budget in balance.

Though acknowledging the department's request is "higher than most people in the Capitol would like," King said he isn't worried about legislative backlash. But he is warning local district officials not to get their hopes up.

"We are advising schools to build budgets on no increase to the funding formula," King said.

As much as DESE says it would take to provide full funding of the formula and related expenses, a private consultant says even more money is needed to achieve student performance standards established in state and federal law.

Dr. John Augenblick is the principal author of a recent report commissioned by the Missouri Education Coalition for Adequacy, a collection of the state's top education lobbying and advocacy groups.

The study says an additional $913 million is needed for operating expenses over FY 2002 levels. The report did not address spending in areas such as student transportation that DESE included in its budget request.

If he were examining the current fiscal year, Augenblick says, it is probable the extra funding needed for operating expenses would top $1 billion.

Augenblick's firm, which is based in Denver, Colo., has worked with state legislatures to develop education funding systems for more than 20 years. He said the firm designed the systems currently used in several states, including neighboring Kentucky and Kansas, and has made recommendations in many more, Illinois and Tennessee among them.

Augenblick, whose doctorate is in education administration, reached his conclusion by developing formulas to determine what it would take for each of Missouri's 522 school systems, excluding two special education districts, to achieve the state and federal performance standards. He concluded 484 districts need to increase funding, while 38 do not.

Augenblick stressed his study did not delve into how the money would be raised but said it would likely have to be from a combination of state and local tax sources. He is working with his clients to develop a reasonable system that would achieve the financial goals.

In his firm's examinations of education spending elsewhere, Augenblick has never found that education funding is sufficient for every district in a given state, though some states come close.

"In Tennessee, almost every district is at adequate levels," Augenblick said.

MoDOT jobs left open

While DESE is beginning its push for a major funding increase, MoDOT for now is focusing on doing its best with what it has.

MoDOT has left open some 300 vacant jobs and saved $40 million over the last two years through improved construction estimates.

With the new federal transportation funding bill in the works and U.S. Sen. Kit Bond, R-Mo., a key player in that effort, MoDOT is hopeful of getting increased financial support from Washington.

The department is also pursuing alternatives to a direct tax hike, such as the authority to build toll roads. However, the concept has enjoyed little legislative support in recent years.

Because of the lack of additional funding, MoDOT is gradually shifting from construction of new roads and bridges to maintenance of the existing system. Goff said that trend will continue, at least in the short term.

mpowers@semissourian.com

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