By: Orlando J. Rodriguez, Senior Policy Fellow for Connecticut Voices for Children

To his credit, Governor Malloy has asked the Education Cost Sharing (ECS) Task Force to advance “a bold agenda for school finance reform.”  While a comprehensive review of education funding is important to address potential shortcomings in the ECS formula, there are simple and common sense reforms that can be implemented in the short term to better match state funding to local needs and ensure that local education dollars are spent on their intended purpose.

Currently, the ECS formula uses personal income data for each town as one variable in determining how much funding each town gets, or alternatively, how able each town is to pay for local preK-12 education.  Towns with higher personal income are expected to pay more of their local education expenses than towns with lower personal income.  For 2011-2012, the ECS formula relies on personal income data from Census 2000 (1999 income).  So, the distribution of our largest source of state funds for local education – $1.9 billion – is based on income data that is 12 years old.  Furthermore, two economic recessions since 1999 have unevenly changed personal income among the state’s 169 towns.  Middle- and low- income towns have seen personal income stagnate or decline.  In contrast, higher income towns have seen their personal income rise despite the recessions.  However, the ECS formula does not accurately reflect these sometimes-extreme changes in personal income among towns.  Consequently, some higher-income towns disproportionately benefit from current ECS calculations because out-of-date income data from 1999 understate their current ability to pay.  That is why, the ECS formula must be updated yearly with the most current personal income data available.  Indeed, all data inputs should be updated yearly.

Separately, it is crucial to ensure that all local tax dollars collected for education are spent on education. State law mandates the amount of local taxes (education expenses are the largest component of local property taxes) that must be collected and “budgeted” for education, but does not require these local funds to be spent on education.  It is legal in Connecticut for towns to collect local property taxes for education but then spend it on roads, town hall remodeling or other non-education expenses.  This disconnect could result in an illusion of high levels of local education spending, but a reality of local education tax dollars being diverted to non-education purposes.  Consequently, it is necessary to mandate that local taxes collected for education be spent only on education.

Though a fully-funded ECS would distribute $2.7 billion to towns, the state only funds $1.9 billion.  In the view of CT Voices for Children, the ideal solution for the task force would be to make necessary updates to the formula and fund all towns at 100 percent of their ECS entitlement.  However, this would require about $780 million more in state funds. Since an allocation of that amount is unlikely given the state’s economic conditions, one alternative is to redistribute the $1.9 billion so that some towns gain funding at the expense of losses to other towns.

As members of the ECS Task Force consider their difficult choices, it is vital for them to consider seriously that children in our poorest towns are the most dependent on ECS funding.  Looking forward, the task force should initiate a more comprehensive discussion on funding pre-K through 12 education based on the actual costs necessary to educate adequately Connecticut’s future workforce – its children.

For more information on ECS reforms, see CT Voices for Children’s Problems with Connecticut’s Education Cost Sharing Grant.

The ideas expressed in this blog post reflect the views of the writer and are not necessarily those of the Connecticut Council for Education Reform (CCER). For information about CCER’s specific stance on these issues, see the Report from the Connecticut Commission on Educational Achievement.