Peer Review of Cost Study Released; Constitutional Amendment to Ignore Cost Studies Released

Mar 29, 2018 by

Jesse Levin of the American Institutes for Research appeared before a joint session of the House K-12 Education Budget Committee and the Senate Select Committee on School Finance to release and discuss his peer review of the cost study conducted this year by Dr. Lori Taylor and Jason Willis of WestED.

Levin had earlier this session conducted a peer review of prior cost studies; one done by Augenblick and Myers and another by the Legislative Post Audit Division. Levin generally panned the A&M studies as not meeting research standards and lauded the LPA study.

We would imagine that the hiring of Levin to conduct a peer review of the Taylor study as insurance in case that study was not in line with their wishes. The Taylor study found that Kansas schools were dramatically underfunded especially given the standards they are expected to achieve.

What Levin reported today was that the Taylor study was generally a very good study that met academic rigor.

The general impression I have of the study by Taylor et al. (2018) is that it represents a quality piece of work which has been thought through and implemented carefully. Specifically, the work demonstrates a rigorous implementation of a stochastic cost frontier analysis to investigate the cost of providing educational adequacy in Kansas. Moreover, the results of the study tell a qualitatively similar story to that of the previous cost function study. (page 12)

Levin did share a few concerns he had about the report. One of the most interesting ones he shared was regarding how economies of scale were applied – the study indicated that some exceptionally large districts would require 1.97 more funding than the optimally sized districts – essentially twice as much funding.

He noted that the Taylor study called for significantly more funding than the earlier LPA study but said that the LPA study seriously underestimated the amount of funding needed because it was based on spending levels rather than costs.

In a nutshell, the Levin peer review determined that the Taylor study was done well and confirmed what earlier studies had said about school funding.

Click here to read the peer review.

Click here to see Levin’s powerpoint presentation.

Elusive Constitutional Amendment is Released

We’ve heard a lot about a desire by conservatives to apparently hold any school finance bill hostage to the passage of a constitutional amendment. Constitutional amendments have surfaced year after year beginning with the Montoy decisions.

Today a new rumored constitutional amendment was introduced in the House.

The constitution currently reads:

The Legislature shall make suitable provision for finance of the educational interests of the state.

This would be changed to read:

As all political power is inherent in the people, the legislature shall determine suitable provision for finance of the educational interests of the state. The determination of the total amount of funding that constitutes suitable provision for finance of the education interests of the state is exclusively a legislative power and shall be made as provided by law. Such power is committed to the legislature under article 2 of this constitution and shall be shown due respect by the other branches of government. No court, or other tribunal established by this constitution or otherwise by law shall alter, amdne, repeal or otherwise abrogate such power, nor shall such power be exercised by, either directly or indirectly, by any such court or other tribunal. (New language in bold.)

Under this proposal, the legislature would no longer have the obligation to provide suitable funding only to determine what it is. One assumes they would provide it but hey, who knows? Further, the language also asserts that no one but the Legislature can make the determination – so much for seeking expert opinions!

Make no mistake, this constitutional amendment is intended to diminish school funding.

It must be first approved by 84 members of the House and 27 members of the Senate; then sent for a vote of the people which requires a simple majority.

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Consultants Present School Finance Study

Mar 19, 2018 by

Conservatives who demanded that the Legislature take no action on school finance until a new cost study was available – a study conducted under their parameters by a consultant that they chose – are now trying to distance themselves from that study and discredit it.

It was conservative Republicans who insisted on doing a new cost study, arguing that the prior studies by Augenblick and Myers and the Legislative Post Audit were outdated. “You can’t take such old studies and just adjust them for inflation!” they cried. “Times have changed!”

And so, over the objections of the Democrats, Republican House and Senate Leadership approved hundreds of thousands of dollars to hire two attorneys and a consultant to conduct a new cost study. They chose a consultant, Dr. Lori Taylor of Texas A&M University, to conduct the study and Senate President Susan Wagle (R-Wichita) told the Wichita Eagle that they had hired a consultant to demonstrate that the state was adequately funding schools.

“We’re focused on finding experts who can help show the court that funding is adequate,” Susan Wagle, R-Wichita (Wichita Eagle, Feb. 23, 2018). 

A lot of people who work under the dome thought that was just what the Legislature would get; that Taylor had been hired to give Wagle what she wanted. Republican leaders held up all discussion of school funding and a response to Gannon in anticipation of this study. See this from an article in Lawrence Journal-World on March 11, 2018:

Senate Majority Leader Jim Denning, R-Overland Park, also rejected the idea that the results of the study were predetermined.

“They’re unfounded in that,” he said. “We have no idea what she’s going to come back with. But we know that we have to update the study.”

Denning said the estimates that Kansas needs to add upwards of $600 million to its education budget are largely based on cost estimates done in 2002 and 2003, during an earlier school finance lawsuit, with those figures simply updated for inflation.

Today, though, Denning was leading the attack to reject or discredit the report. He challenged it on the performance thresholds that were being used, suggesting that use of the approved state ESSA (Every Student Succeeds Act) plan was not appropriate. In other words, if we lower our performance goals, we could lower the cost of education.

Denning even went so far at one point as to refer to the study as “simply an academic exercise, not a financial one.” Still, it was an “academic exercise” that Denning was hanging his hat on earlier as a way to block increases in education funding.

Conservatives have for years been swayed by the rhetoric of Dave Trabert and the Kansas Policy Institute. In fact, if the state had a dollar for every time Trabert said “money doesn’t matter” or “schools are terribly inefficient,”  there might have been enough money in the treasury to pay for this study.

Instead, the report specifically says this about funding increases:

“…a one percentage point increase in academic performance is associated with a 5 percent increase in cost. Similarly, a one percentage point increase in the graduation rate is associated with a 1.2 percent increase in cost at lower grades and a 1.9 percent increase in cost at the high school level.”  (page 61)

As for efficiency, the report noted that “the average cost efficiency score was 0.956, indicating that buildings were producing nearly 96% of the potential output, on average.” (page 63) And one slide in Dr. Taylor’s presentation said, “Systematically school districts are exceedingly good at the efficient use of their resources.”

What Can We Expect Moving Forward?

The report still needs to be fully digested by legislators. We can expect that talks will begin soon about how best to address the Gannon decision in light of this new report.

We would anticipate that conservative legislators will launch an effort to discredit the report or consider other ways to bring down costs. Denning, as we said earlier, has already hinted at reducing the state’s performance goals and referred to the study as simply an “academic exercise.”

Conservatives might also renew their calls for constitutional amendments either limiting the state’s responsibility for education funding or stripping the Supreme Court of the authority to act.

Since the consultants also suggest a longer timeline for phasing funding in, cooler heads will likely begin to discuss how long that might be as well as how to lock in increases over time even as membership in the legislature changes. It is often noted that today’s legislative decisions are not binding on future legislatures.

The study will give conservatives more to complain about but might also give Democrats and Moderates just the boost they need to put together a coalition plan to meet the Gannon ruling.

But no matter what, they need to get cracking! Briefs are due to the Supreme Court on April 30!

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