START HERE: WHAT’S WRONG WITH COLORADO’S BROKEN SCHOOL FINANCE SYSTEM
When Colorado voters tear open their ballot envelopes this month, they’ll be presented with a familiar debate over how to fix the state’s K-12 schools.
They’ll have the option to raise taxes statewide by $1.6 billion to finally fund schools at the level voters intended when they changed the state constitution 18 years ago to keep up with inflation and growth.
They’ll have the option — in several districts — to raise an additional $1.5 billion in local mill levies for specific needs, such as buildings, maintenance, renovations or expanded class offerings.
And they’ll have the chance to elect as governor a Democrat or Republican who have offered widely divergent solutions — and at times, few specifics — on how to tackle intractable problems such as teacher pay, the state’s rural teacher shortage and the convoluted formulas at the heart of the state’s school finance challenges.
Here’s what you need to know about the state of school funding and the direction voters can set this Election Day:
Why this all matters
Colorado policymakers have been grappling with some of these issues for the better part of three decades. Since the Taxpayer’s Bill of Rights was passed in 1992, Colorado has steadily shifted the burden of funding schools from local taxpayers to the state, with a wide array of unintended consequences.
The drop in local funding has left the state unable to keep up — not only with the growing needs of school districts, but other priorities, such as transportation and higher education. Political gridlock has left schools reliant on a 1994 school finance formula that both sides of aisle say is badly outdated, but is a political nightmare to fix.
There are also huge inequities from one district to the next — not only for the students and teachers whose needs aren’t being met, but also for taxpayers.
Rural Colorado is now short thousands of educators, and the trend is expected to get worse before it gets better. Teachers in the state’s poorest districts make poverty-level wages. And even those in better-off metro area districts have steadily lost money to inflation and benefit costs since the recession.
Meanwhile, students have seen their class sizes grow and opportunities shrink, as schools cut back on programs, curriculum and even school days to make ends meet.
The single biggest choice facing voters is Amendment 73
The $1.6 billion tax hike represents a dramatic plan to address a school finance system that both sides agree is dramatically broken.
It would raise income taxes on corporations and people making more than $150,000 a year. It would also give businesses a property tax cut, while preventing future school tax cuts for homeowners, who are due an estimated 15 percent cut next year, thanks to the property tax-limiting Gallagher Amendment.
But can it pass?
History has not been kind to prior attempts at a statewide tax hike for schools. The last one, Amendment 66, would have raised $950 million, and voters shot it down nearly 2 to 1.
Still, advocates say this feels like the right moment — particularly on the heels of teachers in Colorado and across the country mobilizing this spring for better pay. And it has selling points the last one lacked. Income taxes, for instance, would rise only for the wealthiest households, instead of everyone.
Critics say it’s unreasonable to pour that much money into schools without addressing the existing problems with the way the state distributes the money. And the needed threshold of 55 percent to add language to the state constitution means supporters don’t just have to win that argument, they have to do so overwhelmingly in a year that competing interests, like transportation, are seeking tax hikes of their own.
MORE: A preview of Colorado’s 2018 ballot: Taxes, roads and an existential crisis for oil and gas
The two major party gubernatorial candidates are offering very different visions for K-12. And money’s the biggest sticking point.
U.S. Rep. Jared Polis, the Democratic nominee, doesn’t just want to shore up the existing budget holes schools face, he wants to dramatically expand public education in the state to guarantee universal full-day kindergarten and pre-K to every child. On top of that, he’s offered plans to raise teacher pay, protect pension benefits and forgive student loan debt to help attract and keep educators in the profession.
Bottom line, Polis’ plans would require a significant infusion of funding. Full-day kindergarten alone would cost the state an extra $250 million a year, according to a legislative analysis. Universal preschool could cost hundreds of millions more.
To pay for it all, Polis has offered a number of ideas, including public-private partnerships and “social-impact bonds,” an experimental financing mechanism that banks on the government saving money in the future by investing in early childhood education today.
Campaign spokeswoman Mara Sheldon also said he’s “open to going to the ballot box,” to raise money through new taxes — but “only to fill gaps if necessary.”
“We should certainly seek to cut administrative waste where we can, but there isn’t nearly enough there to make up for the funding shortfall affecting Colorado’s public school classrooms every day that has forced a majority of Colorado school districts to four-day weeks,” Sheldon said.
MORE: Where Colorado’s candidates for governor stand on the issues.
State Treasurer Walker Stapleton, the Republican nominee, has plans of his own, but he rejects the idea that more money is needed to improve the state’s schools. He says teachers can be better paid within current budgets by cutting administrative costs, something he wants to accomplish through legislative carrots and sticks, like offering grant matches to reward districts that spend money more efficiently, or capping the amount of state money that can be used on administrative expenses.
On early childhood education, Stapleton isn’t proposing more state spending, and hasn’t promised full-day kindergarten or universal preschool. Instead, he’s looking to offer tax breaks to families to help them afford preschool on their own. One is through a tax-free savings account, which would allow parents to save money for an array of educational expenses, including early childhood programs, music lessons and tutoring.
He’s also proposed a back-to-school sales tax holiday for supplies, clothes and other needs, as they have in more than a dozen other states. It’s not clear, however, how much either tax break would cost the state in reduced revenue.
Neither candidate has endorsed the Amendment 73 tax hike. But only Stapleton is outright opposing it.
“We need to reform the system before more money is thrown at the problem,” campaign spokesman Jerrod Dobkin wrote in a statement to The Colorado Sun. “That will not result in a better education for our children.”
Polis, meanwhile, hasn’t staked out a position one way or the other, and his campaign evaded the question when asked by the Sun if he would vote for it.
“Jared applauds all those who are working to improve funding to our public schools,” Sheldon said. “His role will be to find a path forward to ensure our schools receive the funding they need, whether or not this initiative passes.”
Neither candidate has offered a detailed path out of Colorado’s school funding quagmire. But they have offered clues.
Stapleton’s campaign told The Sun he is “open to addressing the Gallagher formula,” a property-tax limiting provision of the state constitution that has been choking local school funding for decades, while providing tax relief to homeowners. But the campaign didn’t respond to questions seeking specifics.
Polis has been more vocal in pledging action on the complicated interplay among Colorado’s constitutional amendments and the School Finance Act. But he, too, has avoided specifics, with his campaign saying only that he would do so in a “bipartisan way” without eliminating the provision of TABOR that gives voters approval over tax hikes.
Reality check
Nothing on the ballot — or promises made by either candidate — would solve the state’s most intractable problems where schools are concerned. Policy experts on both sides of the aisle say it’s going to take a major legislative effort — and some tough-to-swallow compromises all around — to get from where Colorado is today to a well-functioning system.
Meanwhile, both candidates are offering solutions that are unlikely to be the silver bullets they describe in campaign literature.
Polis’ reluctance to definitively say that new taxes are needed to pay for universal preschool and all-day kindergarten is hard to square with the reality of the state’s current budget, which can’t even keep up with the growth in existing K-12 needs.
And to Stapleton’s point, administrative expenses have grown faster than teacher salaries in recent years. But it’s not clear whether the growth in spending is necessarily waste that’s easy to eliminate.
Conservative and liberal education advocates say schools have boosted administrative spending at least in part to keep up with growing reporting and accountability requirements from the state and federal government.
And because local school boards control their own budgets, with varying needs from district to district, it could make a state-level solution difficult to enact.
Still, if the state’s finances stay on their current upward trajectory, the next governor and legislature will no doubt have opportunities that Gov. John Hickenlooper didn’t in the throes of the recession — with or without an extra $1.6 billion to work with.
