Kansas lawmakers advance school finance bills

Lawmakers could send legislation to the governor as early as Thursday in an effort to address the Supreme Court’s order that they fix inequities in school funding or risk closing schools.

House and Senate budget committees approved nearly identical bills Wednesday that would change the way the state calculates equalization aid. The proposal reshuffles existing money for schools and keeps funding for most districts flat.

Opponents say it falls short of the court’s demand to close gaps between districts. But supporters say it will be the fix needed to prevent school closures, and they want to see passage before lawmakers are scheduled to begin a month-long break on Friday.

“I would say the court is requiring us to fast-track this bill,” said Sen. Ty Masterson, R-Andover, who chairs the Senate Ways and Means Committee.

“I think it’s imperative, because of the dire situation – potential closure – it’s imperative we have some answer, so the courts can at least evaluate that,” Masterson said, adding that the likelihood that the court would close schools could increase if lawmakers waited until May to pass a bill.

He said he would ask Senate leadership to make HB 2655 the first item on the debate calendar Thursday. If the Senate passes the bill, it would go to the House, which would have to vote to concur with it.

The House Appropriations Committee advanced its own version of the bill, SB 59, but House Speaker Ray Merrick’s office said the Senate would debate the legislation first.

Rep. Ron Ryckman, R-Olathe, the House budget chairman, said lawmakers are doing their “best to make sure our schools stay open.”

Gov. Sam Brownback said he was pleased that lawmakers were working quickly to address the ruling instead of waiting until May or June. “I’m encouraged that people are talking and we’re in March, not a lot later.”

“We need people talking, not shooting at each other,” Brownback added.

No change for most districts

Most school districts would see no overall change in state aid under the plan. It cuts one category of aid for the majority of the state’s districts but offsets that with another category. Lawmakers say this will hold all districts harmless.

The bill would add about $2 million to the state’s education system; 23 school districts would gain funding. The rest would receive the amount they are set to receive under the state’s block grant system.

Sen. Laura Kelly, D-Topeka, the ranking Democrat, said the bill does not equalize funding. She likened it to playing a game of chicken with the court.

“I don’t think the court’s stupid,” she said. “And I think they’ll clearly read through all of this.”

The bills change the way the state calculates equalization aid for property-poor districts that are unable to raise as much local tax revenue as property-rich districts. The new method results in significantly less money than Wichita and other plaintiff school districts expected when the court ruled in their favor last month.

“I’m not sure this will pass muster, quite frankly,” Jim Freeman, chief financial officer for Wichita schools, told a Senate committee Wednesday.

He said the block grants enacted by the Legislature last year represented a $26.3 million cut for Wichita schools over three years. These bills lock in that level of funding.

Freeman said the district used reserve funds to make up for the loss in state money this year, but won’t be able to do that next year. The district released options for potential budget cuts on Monday. They include eliminating 90 teaching positions and reducing some programs, such as JROTC.

State budget constraints

Sen. Jim Denning, R-Overland Park, noted the state’s budget constraints and told Freeman that other districts had been able to balance their budgets without staff reductions. The state faces a shortfall of more than $30 million for the current year.

“You’re well aware of the budget situation, and you’re asking this body to come up with additional funding,” Denning said. He asked Freeman if the Legislature should reduce pension payments to cover the cost of increasing equalization aid.

Freeman pointed to the state’s tax policies instead.

“I don’t have the ability to adjust my revenue side, where (the) Legislature does to some extent,” Freeman responded.

Cindy Lane, the superintendent of Kansas City, Kan., schools, another plaintiff in the lawsuit, said all the bill does is redistribute funding that has already been ruled inadequate.

The bill cuts one pool of money for districts and then gives it back immediately as another pool.

Lane compared this to a woman shifting the money she has in her purse. At no point would the woman actually have more money in her purse, she said.

Asked about the districts’ concerns, Ryckman said “there’s other options besides just always going and asking for additional money from the state to equalize.”

He said school districts could raise local property tax rates to bring more money to classrooms, noting that both KCK and Wichita have lower rates than the Blue Valley school district.

Johnson County vs. Wichita

Johnson County school officials supported the legislation at the Senate hearing.

“It’s March 23. And this bill is by far the best one-year solution,” said Jim Hinson, Shawnee Mission’s superintendent.

Hinson said that all schools face severe budgetary uncertainty right now and that passing a funding bill quickly would alleviate that. “We would absolutely love this bill to get through this week,” he added.

Earlier school finance bills would have sent millions of dollars in additional state aid to Wichita and other Sedgwick County districts, but would have cut state aid from Johnson County districts. Johnson County lawmakers opposed that.

The new legislation has caused backlash from some districts that expected to gain from equalization changes.

Perry McCabe, the business manager of Buhler schools, sent every senator an e-mail Tuesday night, saying, “Your bills should not only help the JoCo schools, but all of the rest of the schools in Kansas.”

McCabe noted that Buhler schools lost more than $900,000 over two years when the state enacted block grants and disputed the notion that the bill holds all districts harmless.

Rep. Jim Ward, D-Wichita, said Johnson County Republicans stood up for their county’s schools, but complained that Wichita-area Republicans “who have positions of power and should be able to defend us … are letting the Johnson County people get all of our money.”

“We’re sending $10 million up the turnpike to Johnson County,” he said.

This story was originally published March 23, 2016 at 12:21 PM with the headline "Kansas lawmakers advance school finance bills."