Some hefty matters await Wyoming lawmakers when they reconvene March 1 for the final stage of this most unconventional 2021 legislative session.
The supplemental budget bill looms large, and with good reason: The state is in the midst of a historic revenue crisis and a number of difficult cuts will have to be made.
But for pure law-making nuance, political complexity and long-lasting impact, perhaps no forthcoming sausage will be meatier than House Bill 61- School finance recalibration.
Legislators are reluctant to make major changes to the state’s public education program outside of the standard recalibration process because the Wyoming Supreme Court has ruled repeatedly that significant changes to our public education system must be evidence-based. In other words, lawmakers have to collect and consider expert opinion. Changes made without such input risk being overturned in court.
The recalibration bill, introduced at five-year intervals, recognizes that requirement and has been the usual vehicle for incorporating expert input and making any major changes to education.
This year, with the declining mineral economy and associated precipitous drop in funding, one might have expected recalibration to result in significant cost-reducing changes in the education foundation program. Thus far, however, the proposed changes have been minor. This is partly explained by the sharp differences in opinion on the committee — differences which reflect the broader divide between our two legislative chambers. The Senate members appear more hawkish on education spending than those from the House.
Adding to the political complexity, senators and representatives aren’t the only vested stakeholders. Officials from the state’s 48 school districts, budget-conscious citizens, educators and advocates for an evidence-based approach all have skin in the game. Each group will find much to like about the bill and much to hate about it. The problem is that these groups will no doubt diametrically differ in their assessments.
The state’s fiscal reality has changed dramatically yet this year’s recalibration bill is nearly a carbon copy of the recalibration bill from five years ago — which was also almost a carbon copy of its predecessor.
One significant new feature, however, is turning heads: Language near the end of the bill requires a $100 million education-foundation-funding cut to districts in proportion to their respective enrollment.
Since public school average daily membership (ADM) is about 92,000 students, this reduction translates into roughly $1,000 less per student. School districts and their lobbyists will not like this new feature and will try to reduce the amount or even eliminate it. Those focused on evidence-based changes and support will also oppose it. Budget-minded legislators and residents will favor this change.
The current recalibration doesn’t call for changes to existing human-resource requirements. That means keeping a model that calls for 941 more classroom teachers — four to nine fewer students per classroom in grades four and above — than a purely evidence-based model requires. This increases the annual cost of the model by about $70 million.
School districts are sure to support this aspect of the bill, but budget hawks won’t. The let’s-make-decisions-based-on-evidence crowd will side with the budget-conscience on this feature of the bill, further demonstrating the political complexity of making changes to education.
The most unusual part of the bill is a section that calls for funding the education foundation program through an unspecified increase in the state sales and use tax. This section of the bill was undoubtedly added because the recalibration committee wants to maintain education spending levels as much as possible in the face of falling school foundation revenues.
The amount of the sales tax increase is to be determined by further legislation. Observers assume it will depend on how much is needed to replace the ad valorem and royalty mineral revenues that we relied on so heavily for so long. Why the new revenue source was not a property tax increase is a mystery.
This section of the bill has received support from some school district officials. However, it is certain to be opposed by budget-conscious legislators.
In another head-scratcher — and a missed opportunity for some real cost savings — the bill doesn’t appropriately address the enormous community-to-community differences in cost of living across Wyoming. More than most states, costs of living and other factors that affect school districts’ ability to attract, hire and retain quality staff vary from district to district. To further complicate matters, dramatic changes in these costs occur within given districts over time due to volatilities in the mineral industry. A school district can be a very expensive place to live one year, and then be quite affordable 10 years later.
This means that there is a serious need for up-to-date measurements of cost variations from district to district if recruiting opportunities are to be fair and equitable.
The bill as currently drafted specifies that the cost-of-living index for districts be based on 2005 comparisons — 16-year-old data. When the next recalibration takes place, the index will be fully 20 years out of date unless the bill is amended to update the index during the 2021 Legislative session.
Districts in which living costs were high in 2005 have a natural desire to utilize this favorable index indefinitely. In addition, the model gives districts two indexes to choose from, further compounding the problem of achieving equity among school districts.
Together, the defects in regional cost adjustments will cost the state $25 million per year if not corrected.
Because of the new revenue challenges in Wyoming, individual legislators are sure to find fault with the recalibration bill. Time-consuming amendments to HB 61 will be plentiful in the remaining days of the session.
Individual legislators have also filed stand-alone bills that seek to address specific concerns, such as the large amounts allotted in the model for student activities. Wyoming’s per student expenditure for activities is among the highest in comparable states. Moreover, in nearly all school districts, total spending for activities even exceeds the model allocation for activities.
Student transportation costs and school consolidation are other areas that one might have expected to deserve special study in the recalibration effort. They will both be controversial topics of debate in the recalibration bill, and the subject of additional legislation.
To summarize: Buckle up, there is a long road ahead before the Legislature, and the public it represents, are satisfied with the 2020 recalibration exercise.