Investing in Missouri: Creating a Better Future for Our Families
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1 Investing in Our Students Futures OCTOBER 2015 Investing in Missouri: Creating a Better Future for Our Families Missourians want to give our children the best possible chance at success. We want our children to have quality public schools that start them off right towards pursuing their dreams. Unfortunately, the state of Missouri is failing to meet its obligation to more than 820,000 K-12 students by shortchanging school funding. As a result, the burden for ensuring school funding is increasingly shifting to localities, setting the stage for enhanced funding disparities between school districts. In the current school year, the amount of funding provided through Missouri s Foundation Formula, which distributes state support to local schools, remains $400 million under the statutorily required level. 1 Had state funding increased at the same rate as inflation between the 2001 and 2014 school years, state funding would have been $361 million greater in FY That s the equivalent of our local schools having an additional $554 per student to enhance educational opportunities. Local governments have tried to make up the difference, resulting in property tax rate increases in 92 percent of counties in Missouri. Rates have risen an average 11.5%.
2 INVESTING IN OUR STUDENTS But not every local government can or will make up for the state s lack of funding. In one of four Missouri counties, total funding per student has failed to keep pace with the increased cost of providing education since In the school year, total funding per student already varied significantly with St. Louis County averaging 75 percent more in total funding per student compared to St. Francois County. All of Missouri s children deserve an opportunity to thrive. A solid education is a fundamental building block to a better future. We can and must do better by fully funding our local schools. The Value of State Funding is Declining Although the combined amount of the Foundation Formula and Proposition C revenue for local schools has increased over time, it has failed to keep pace with inflation and the growing costs of funding education. How Missouri Funds K-12 Education Our local schools receive funding through several sources, which can be aggregated into three major categories: local, state, and federal level. Federal funding: Makes up the smallest portion of funding, is generally earmarked for specific purposes, like school lunches or special education. Local funding: Is primarily provided through local property taxes. State funding: Is provided primarily through two major categories: the Foundation Formula and Proposition C. Foundation Formula: In 2005, lawmakers approved the Foundation Formula in order to provide some measure of base funding for school districts, thereby promoting equity for students across Missouri. However, the formula has not been fully funded since Proposition C: Missouri also distributes earmarked state sales tax revenue to local schools. In 1982, Missouri voters approved a one cent sales tax for education called Proposition C. For the purposes of this paper, data is aggregated by county rather than individual school districts. County data is the sum of data for school districts headquartered in that county. School district and county boundaries do not correlate perfectly in all instances. Although the combined amount of the Foundation Formula and Proposition C revenue for local schools has increased over time, it has failed to keep pace with inflation and the growing costs of funding education. Between the and school years, state funding for local schools increased by 22.7 percent. However, that growth rate fell well below the inflation rate over the same period of 34 percent. As a result, the real value of state funding has declined. Had state funding increased at the same pace as the inflation rate (as measured by the Consumer Price Index), state funding would have been $361 million greater in FY 2014.
3 INVESTING IN OUR STUDENTS State Funding Failing to Meet Inflationary Needs The school population increased by nearly 18,000 students over this same period, making the decline in the value of state funding more pronounced. 3 While state funds increased an average of $799 per student, when that amount is adjusted for inflation, the purchasing power in was $554 per student below the level provided in In five out of every six counties, the amount of state funding provided per student failed to meet inflationary cost increases. Moreover, in four counties (St. Louis City, Knox, Morgan, and Chariton), the amount of state funding actually decreased in nominal dollars over this period. In only 18 of 115 counties did state funding meet or exceed inflationary needs on a per-student basis. Passing the Buck As the value of state funding has declined, local governments have shouldered an increased burden for funding education. While Missouri provided 48 percent of total funding for its schools in the school year, by , its contribution had declined to 41 percent. Conversely, local revenue as a portion of funding increased from 45 to 50 percent over this same period. In 84% of Missouri Counties, State Funding Per Student Has Failed to Keep Up with Inflation Combined with Local & Federal Funding, Total Funds Fall Behind in Many Areas Atchison Holt Nodaway Andrew Buchanan Platte Worth Gentry DeKalb Clinton Clay Jackson Cass Bates Vernon Barton Jasper Newton McDonald Harrison Daviess Caldwell Ray Lafayette Johnson Henry St. Clair Cedar Dade Lawrence Barry Mercer Grundy Livingston Carroll Polk School Year Putnam Sullivan Linn Saline Pettis Benton Hickory Greene Stone Chariton Dallas Christian Taney Schuyler 7% 9% 45% 50% 48% 41% Adair Macon Howard Cooper Morgan Randolph Moniteau Camden Webster Laclede Boone Boone Miller Wright Douglas Ozark Scotland Cole Knox Pulaski Shelby Monroe School Year Proportion State Funding Proportion Local Funding Proportion Federal Funding Clark Lewis Audrain Callaway Callaway Osage Maries Texas Phelps Howell Marion Ralls Montgomery Gasconade Dent Pike Warren Crawford Shannon Oregon Lincoln Franklin Reynolds Carter St. Charles Washington Ripley Total Funding Per Student, All Sources State & Total Revenue Did Not Keep Up with Inflation State Funding Did Not Keep Up with Inflation St. Louis Jefferson Ste. Genevieve St. Francois Iron Madison Wayne Butler State and Total Met Inflationary Increases Bollinger Dunklin Perry Stoddard Girardeau Scott New Madrid State Funding for Education Has Declined as a Portion of Total Funding; State Passes the Buck to Localities Pemiscot Mississippi
4 INVESTING IN OUR STUDENTS Increased Property Taxes and Disparities in Funding for Education To compensate for the decline in the value of state funding, Missouri schools have shifted to a greater reliance on local property tax revenues to fund education. As a result, over thirteen years, local property tax rates to fund schools increased in 92 percent of counties, rising by an average of 11.5 percent. Only six counties decreased their property taxes during this time, and three maintained their rates. 5 Unfortunately, while some school districts have been able to address decreasing state funding by leveraging increased property values, districts with low property values including many rural school districts struggle to adequately fund local schools. In fact, even with property tax levy increases in most counties, the total amount of state, local, and federal funding combined per student failed to keep pace with inflation in 31 counties over the time period examined. In other words, in one out of every four Missouri counties, total funding per student failed to keep pace with the cost of providing education. The shifting burden of funding education could result in increasing a troubling disparity in education funding among school districts. In the school year, the combined per student revenue available varied significantly among school districts from a low of $8,968 in St. Shifting the Burden Toward Local Funding May Enhance Troubling Disparities Total Funding Per Student Varies Greatly Statewide Atchison Holt Nodaway Andrew Buchanan Platte Worth Gentry DeKalb Clinton Clay Jackson Cass Bates Vernon Barton Jasper Newton McDonald Harrison Daviess Caldwell Ray Lafayette Johnson Henry St. Clair Cedar Dade Lawrence Barry Mercer Grundy Livingston Carroll Polk Putnam Sullivan Linn Saline Pettis Benton Hickory Greene Stone Chariton Dallas Christian Taney Schuyler Adair Macon Howard Cooper Morgan Randolph Moniteau Camden Webster Laclede Boone Miller Wright Douglas Ozark County Property Tax Rate Changes Between and School Years County Names & Rates Included in Appendix -15% -10% -5% 0% 5% 10% 15% 20% 25% 30% 35% Francois County to a high of $15,778 in St. Louis County. Significant disparity in funding exists within each county as well, which is not addressed in this analysis. Scotland Cole Knox Pulaski Shelby Monroe Clark Lewis Audrain Callaway Osage Maries Texas Phelps Howell Marion Ralls Montgomery Gasconade Dent Pike Warren Crawford Shannon Oregon Lincoln Franklin Reynolds Carter St. Charles Washington Ripley Total Funding Per Student, All Sources Under $10,000 $10,001 - $11,000 $11,001 - $12,000 $12,001 - $13,000 $13,001 - $15,000 > $15,000 St. Louis Jefferson St. Louis City Ste. Genevieve St. Francois Iron Madison Wayne Butler Bollinger Perry Stoddard Cape Girardeau Scott New Madrid 92% of Missouri Counties Have Raised Property Taxes Average Increase of 11.5% Since 2000 Missouri must do better and fulfill its responsibility to students across the state. Mississippi
5 APPENDIX A: CHANGES IN STATE PER STUDENT FUNDING 2000/2001 COMPARED TO 2013/2014 SCHOOL YEARS County State Funding 2000/2001 Students 2000/2001 (ADA) State Funding Per Student 2000/2001 State Funding (ADA) 2013/2014 Students 2013/2014 (ADA) State Funding Per Student 2013/2014 (ADA) % Change in State Funding Per Student 2000/2001 vs. 2013/2014 Adair Andrew Atchison Audrain Barry Barton Bates Benton Bollinger Boone Buchanan Butler Caldwell Callaway Camden Cape Girardeau Carroll Carter Cass Cedar Chariton Christian Clark Clay Clinton Cole Cooper Crawford Dade
6 APPENDIX A: CHANGES IN STATE PER STUDENT FUNDING 2000/2001 COMPARED TO 2013/2014 SCHOOL YEARS (continued) Dallas Daviess DeKalb Dent Douglas Dunklin Franklin Gasconade Gentry Greene Grundy Harrison Henry Hickory Holt Howard Howell Iron Jackson Jasper Jefferson Johnson Knox Laclede Lafayette Lawrence Lewis Lincoln Linn Livingston Macon Madison Maries Marion
7 APPENDIX A: CHANGES IN STATE PER STUDENT FUNDING 2000/2001 COMPARED TO 2013/2014 SCHOOL YEARS (continued) McDonald Mercer Miller Mississippi Moniteau Monroe Montgomery Morgan New Madrid Newton Nodaway Oregon Osage Ozark Pemiscot Perry Pettis Phelps Pike Platte Polk Pulaski Putnam Ralls Randolph Ray Reynolds Ripley Saline Schuyler Scotland Scott Shannon Shelby
8 APPENDIX A: CHANGES IN STATE PER STUDENT FUNDING 2000/2001 COMPARED TO 2013/2014 SCHOOL YEARS (continued) St. Charles St. Clair St. Francois St. Louis St. Louis City Ste. Genevieve Stoddard Stone Sullivan Taney Texas Vernon Warren Washington Wayne Webster Worth Wright State Funding Per Student, 2000/2001: $3,982 State Funding Per Student, 2013/2014: $4, /2001 Funding Adjusted for Inflation: $ $5,335 Amount Less Per Student if 2000 Funding Had Kept Pace With Inflation: $554.88
9 APPENDIX B: COUNTY PROPERTY TAX RATES FOR SCHOOLS, 2001 vs County 2001 School Property Tax Levy 2014 School Property Tax Levy Change in Property Tax Rate Percent Change in Property Tax Rate Adair Andrew Atchison Audrain Barry Barton Bates Benton Bollinger Boone Buchanan Butler Caldwell Callaway Camden Cape Girardeau Carroll Carter Cass Cedar Chariton Christian Clark Clay Clinton Cole Cooper Crawford Dade Dallas Daviess
10 APPENDIX B: COUNTY PROPERTY TAX RATES FOR SCHOOLS, 2001 vs DeKalb Dent Douglas Dunklin Franklin Gasconade Gentry Greene Grundy Harrison Henry Hickory Holt Howard Howell Iron Jackson Jasper Jefferson Johnson Knox Laclede Lafayette Lawrence Lewis Lincoln Linn Livingston Macon Madison Maries Marion McDonald Mercer Miller
11 APPENDIX B: COUNTY PROPERTY TAX RATES FOR SCHOOLS, 2001 vs Mississippi Moniteau Monroe Montgomery Morgan New Madrid Newton Nodaway Oregon Osage Ozark Pemiscot Perry Pettis Phelps Pike Platte Polk Pulaski Putnam Ralls Randolph Ray Reynolds Ripley Saline Schuyler Scotland Scott Shannon Shelby St. Charles St. Clair St. Francois St. Louis
12 APPENDIX B: COUNTY PROPERTY TAX RATES FOR SCHOOLS, 2001 vs St. Louis City Ste. Genevieve Stoddard Stone Sullivan Taney Texas Vernon Warren Washington Wayne Webster Worth Wright Statewide Average
13 ENDNOTES 1 Missouri Department of Elementary and Secondary Education 2 Missouri Budget Project analysis using the Consumer Price Index as a meaure for inflation. 3 The student population rose from 806,059 in the school year to 823,981 students in State funding averaged $3,982 per student in and $4,781 in Clark, Hickory, Andrew, Platte, Worth, and Montgomery counties decreased their property tax rates. McDonald, Ralls, and Wayne counties maintained their rates between 2000 and 2014.
14 ENDNOTES 1 Missouri Department of Elementary and Secondary Education 2 Missouri Budget Project analysis using the Consumer Price Index as a meaure for inflation. 3 The student population rose from 806,059 in the school year to 823,981 students in State funding averaged $3,982 per student in and $4,781 in Clark, Hickory, Andrew, Platte, Worth, and Montgomery counties decreased their property tax rates. McDonald, Ralls, and Wayne counties maintained their rates between 2000 and 2014.
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