Vouchers > public schools last night. By the numbers

I wanted to recap the fiscal side to the sickening K-12 education bill that was jammed through the Joint Finance Committee late last night, because there are a lot of claims out there, and a look at the numbers will show just who the real winners in this bill are. I’ll give you a hint, it’s not public schools or communities that rely on them.
Here’s the 29-page motion that was developed in secret by the Wisconsin GOP and unveiled last night. And I’ll go over a few of the big parts of this.

School Levy Credit They’re going to still give away $105.8 million in each year, but instead of “double-paying” that in year 2 of the budget, they’ll just have the payment be in July of each fiscal year, same as before. This does cause an increase in the state’s GAAP deficit, as mentioned under Alternative #4 in the Legislative Fiscal Bureau’s paper on property tax credits.

Under AB 21/SB 21 [the Governor’s Budget Bill], the additional $105.6 million would be paid in July, 2016, relative to the 2015(16) tax year, and in June, 2017, relative to the 2016(17) tax year. By continuing to make the payment in July, rather than June, GPR expenditures would be reduced by $105.6 million in 2016-17, relative to the Governor's proposal [Alternative #4]. This modification would not affect the property tax estimates displayed in Table 1. Instead, this change would make $105.6 million GPR available for other purposes in 2016-17, but would increase the GAAP deficit by an estimated $80.2 million.

And that extra $105.6 million made available for Year 2 of the budget is what was grabbed to help pay for the increases in funding to K-12 schools in this omnibus. It’s the only way that a large sum of money could be added to the already-tight budget while still allowing it to balance (although as you’ll see, we may be heading over the edge anyway).

School aids The baseline K-12 aids stay the same as in Governor Walker’s budget (no change year 1, up 2.4% in year 2). But the source of contention was the $127 million that was cut from per-pupil aids in the Year 1, with $142 million added back in Year 2, for an $18 per-pupil change from 2014-15 (at $150 a student) to 2016-17 ($168 a student). In order to smooth out these wild fluctuations in K-12 funding, the GOPs on the JFC did some creative accounting, and the Per-Pupil aid paper from the LFB is a good source to follow along with.

The first step that was done was to get rid of the $150 cut for school year 2015-16, which is a total of $126.8 million. The problem is that there isn’t enough money available in 2015-16 to pay for all of that, as the Governor’s budget only gave $27 million of cushion beyond the state-required reserve limit. So how did they solve that problem? By shoving all of the increases into Year 2.

Provide $126,842,300 GPR in 2016-17 for per-pupil aid payments based on 2015-16 enrollments. Specify that, on a one-time basis, this aid be paid on a delayed basis on the second Monday in July of 2016. Specify that this delayed payment would be considered as moneys appropriated in 2015-16 for the purposes of calculating an increase in categorical aid funding per pupil.

Then they will add another $69.34 million for per-pupil aid in 2016-17, resulting in a new total of $196.18 million, or $250 per pupil. In addition, this amount is expected to be ongoing, so this means that the new base for future years becomes that $196.18 million, adding nearly $110 million to the state’s structural deficit for 2017-19.

If that’s all there was to this bill, with no further shuffling of funds, there might be a bit of concern about unfunded tax breaks and kicking the can down the road, but I’d think most people would be happy with the outcome. But the problem is that this is not all there is, as the voucher expansion and other provisions cut out a sizable amount of the K-12 funding increase.

The first part is easy enough to figure, and I mentioned this earlier this week. It uses the open enrollment basis to re-distribute aid from a child’s home district to the voucher school, albeit at higher amounts for vouchers ($7,210 for K-8 and $7,856 for high school vs. $6,647-$6,755 for open enrollment to public schools). This moves $18.4 million in year 1 and $29.4 million in year 2 from all K-12 districts vouchers, and the added per-pupil aids also play a role here, as the vouchers get another $4 million from the current program, while Milwaukee and Racine public schools have $1.3 million sent away from school aids based on that.

The often online-based “independent “2r” charter schools” also get a nice kickback in this bill, to the tune of $1.25 million, which also is taken away from public schools. The only extra help the public schools get are a one-time shot of $5 million in High-Cost Special Ed. Aid in year 2 (and some of that can go to CESAs and charters), and they get back $4.0 million due to the removal of a Walker plan for a Charter School Oversight Board, which would have given that money to operators of charter schools (they don’t need that with all the extra voucher money being thrown around).

So let’s add up the totals and see what we get. We’ll even allow for the assumption of “no loss of per-pupil aid in 2015-16, even though that money will be delayed into the next fiscal year.

Total K-12 public school aids, 2015-16
Per-pupil increase $0
MINUS voucher expansion -$18.4 million
MINUS current voucher program -$123,000
MINUS 2r charters -$108,000
TOTAL CHANGE IN AIDS -$18.6 million

Total K-12 public school aids, 2016-17
Per-pupil increase +$69.34 million
PLUS High-Cost Special Ed +$5.0 million
PLUS No Charter School Board +$4.0 million
MINUS voucher expansion -$29.4 million
MINUS current voucher program -$1.20 million
MINUS 2r charters -$1.14 million
TOTAL CHANGE IN AIDS +$46.6 MILLION

TOTAL CHANGE PUBLIC SCHOOLS 16-17 vs 14-15 +$28.0 million
TOTAL CHANGE VOUCHERS 16-17 vs 14-15 +$51.8 million

You’re reading that right. Under last night’s surprise omnibus bill, Wisconsin’s voucher schools got a bigger two-year bump in state aids than the K-12 public schools got under this bill. Now you see why the voucher lobby spent all that money to get GOP puppets put into the Legislature last Fall, and now those extra taxpayer funds give a sizable pot of money that can be kicked back Scott Jensen and other lobbyists, and to throw behind more GOP puppets in future years.

It’s why Wisconsin’s voucher game isn’t a bad scam if you’re in on it. But for the vast majority of us that aren’t, and actually care about educational outcomes, it’s a sickening recipe for disaster, and a major harm to Wisconsin’s ability to generate and attract talent. This is what Scott Walker really meant by “Open for Business”, and it has nothing to do with growing our economy.