Adequate State School Fund is force for local control
In 1990, the state provided about 28% of Oregon school funding. Property taxes and local operating levies picked up most of the rest. But with Ballot Measure 5 in 1990, voters limited school funding to $5 of every $1,000 of assessed property tax value.
More property tax limits followed, requiring the state to replace the lost local funds. By the end of the decade, the State School Fund accounted for more than two-thirds of schools’ budgets.
Adequate and stable State School Fund resources are essential to everything schools do because schools no longer have the local power to decide their financial fate.
“The State School Fund is your bread and butter,” said John Rexford, the Quality Education Commission chair. “It’s how you are going to turn on the lights in the classroom, how you are going to open classrooms in September.”
The Quality Education Commission was created in 1999 to advise the Legislature on best education practices and what it would cost to implement them in Oregon. Every two years, it creates a report on providing the Quality Education Model.
The 2022 report estimated that delivering a high-quality education to all Oregon students would require an $11.9 billion 2023-25 State School Fund. Gov. Tina Kotek has proposed $9.9 billion. Oregon education leaders say districts need at least $10.3 billion for most schools to avoid cuts.
Legislative Highlights is offering a weekly look at the State School Fund process, “Funding Oregon’s Future,” so school board members can understand why the State School Fund is the priority focus of education advocates.
Rexford started his education career in 1985 as a Winston-Dillard School District finance manager and retired as the High Desert Education Service District superintendent in 2017. He continues to teach school business courses. He has lived the change in school funding.
“If the state is going to hold that responsibility, they have a duty to pay for quality education,” Rexford said. “I think it’s a duty for the Legislature and the governor to provide adequate funding for our kids.”
Before 1990, districts saw wide disparities in their per-pupil spending. Wealthy urban districts and rural districts with resources such as timber revenue could fund high-end schools while some school districts were ending their school years early because they couldn’t pass a levy.
When the state took on the funding, it also equalized the money in schools. In essence, local property taxes and state funding go into one big pot and are distributed based on enrollment plus additional money for students in more costly programs such as for English language learners or special education.
It helped stabilize funding for some districts, but it also made school budgets more dependent on the Legislature’s decisions.
Grants Pass Superintendent Tim Sweeney said his father, who was an Oregon superintendent in the 1970s and ‘80s, had far more flexibility to work with his community to create the schools they wanted. Now if the State School Fund comes in low, districts can’t realistically pass a levy quickly enough to avoid budget impacts.
“If the State School Fund is insufficient, we have only two real tools: cut staff or cut school days,” he said. “There’s just no wiggle room.”
And school boards take the brunt of frustrated parents, Sweeney said.
Controlling the purse strings gives the Legislature power over schools. New pots of money for schools, such as the Student Success Act or summer school support, also come with directions on how they have to be used. The State School Fund has its accountability requirements as well, but it offers school leaders the most latitude.
A robust State School Fund is also a robust local control measure, Sweeney said, because it gives communities more say over how their children will be educated.
Communities that want to improve their schools must pass local bonds or levies, but bonds can’t be used for operating costs or paying staff. Both are notoriously difficult to pass in some parts of the state. Not every voter is a concerned parent.
Roseburg School Board Chair Howard Johnson said it’s hard for school board members when parents want better for their children but voters are unwilling or unable to add local funds.
“Officially, you’ve got to take care of the kids,” Johnson said.
Doing so, he said, requires “adequate funding from both the local community and the state.”
The Parkrose School District in east Portland foresaw a budget problem coming and attempted to pass a levy in November to pay for 22 teachers and educational assistants.
Voters said no.
Board member Sonja McKenzie said the district struggled to show the community how urgently local funds were needed because the State School Fund wasn’t sufficient.
“We did it out of necessity,” said McKenzie, the OSBA Board president. “We’re looking at a shortfall. We’re looking at potential layoffs.”
Now the district is hanging all its hopes on the State School Fund just to maintain its programs.
“It’s everything to us,” McKenzie said.
- Jake Arnold, OSBA
jarnold@osba.org
Previous Funding Oregon's Future stories:
Feb. 13: ‘Total investment’ in Oregon schools doesn’t tell full story
Feb. 6: $9.9 billion State School Fund is better but students deserve more
Jan. 30: Bill aims for true accounting of school funding needs