Baltimore Education Coalition Organizing to Fight Funding Cuts

Baltimore Education Coalition Organizing to Fight Funding Cuts

Maryland school children, teachers, and parents are bracing to resist major cutbacks in State aid to public schools.  In the City, the Baltimore Education Coalition will host a large-scale meeting on January 13 at Digital Harbor High School to prepare for the battle.

“Our message to Baltimore City Delegates and Senators is that cuts to public education should be off the table,” said Sue Fothergill, BEC Co-chair.  “Maryland is the richest state and can afford to give every child a quality education.”

Schools are already feeling squeezed because of a half billion dollars in annual reductions in State aid that have been imposed since 2007 and the focus on high-stakes testing.  Superintendents and principals are facing difficult choices and are too often deciding that arts and physical education faculty are unaffordable luxuries.  City Schools Chief Andres Alonso has already cut central administrative staff drastically.

It costs about $11.4 billion annually to educate 850,000 students in Maryland public schools.  The State provides 45% of that amount and the federal government provides another 6%.  For each of the past two years, Governor O’Malley used $430 million of additional federal money from the American Reinvestment and Recovery Act (ARRA, “the stimulus”) to stand in for State general funds that are missing because of the Great Recession.

The federal funding is equivalent to the salaries and benefits for about 5,000 teachers, but it will not be available for fiscal year 2012 (which starts July 2011).

Both State and local governments are faced with serious revenue shortfalls and will be hard-pressed to maintain even the current reduced public school funding.  Various estimates of the shortfall in State general revenues - mainly from income and sales tax – range from $1.3 billion to $2.1 billion.

Local school boards have no authority to raise revenue and must depend on local governments.  Local property taxes are only beginning to fall as a result of the housing/ financial crisis.  Between 2007 and 2010, home prices in both the Baltimore and Washington areas fell about 22%, yet total Maryland property assessments rose 18% during the period due to time lag in assessment.

The results of new assessments just announced in December 2010 indicated a 22% drop.  One-third of properties are assessed each year, and assessments may dive even more in 2011.  When the full real estate decline is reflected in assessments in 2-3 years, local governments will have to raise rates or see further major declines in revenue.

Governor O’Malley has made seemingly contradictory pledges – not to cut public education or change the funding formulas on the one hand and, on the other, to “submit a budget that relies entirely on cuts to close the budget gap.”

Options proposed by various legislators or aides to the Governor could lead to layoffs of up to 6,000 teachers.

Education Week, a magazine with roots in academia and the philanthropic community has rated Maryland public schools the best in the nation for the past three years.  Scores on tests and graduation rates have risen.  Most education observers in the State have attributed the rating to a substantial increase in State aid to local public schools.

In 2002, after a 15-year battle and two law suits, Maryland advocates for public education won a major victory when a new formula for State aid to public schools was signed into law.  By 2008, local school districts were getting $1.42 billion in additional aid from the State.  School systems were able to hire about 9,000 teachers plus other staff and raise salaries.

Low-wealth school districts like Baltimore City were major winners because of the funding formula, which was developed under the leadership of Howard University Professor Alvin Thornton.  Under the formula most of the $5.2 billion in State aid goes to lower-wealth counties and Baltimore City. 

Twenty-five years ago, Baltimore City was spending only about 60-65% of what Montgomery County was spending per pupil.  Now, the per-pupil outlays are the same in the two jurisdictions.

Recently, Dr. Thornton has been visibly pushing for the counties to “stick together.”  There is concern among education advocates that wealthy jurisdictions such as Montgomery, Howard, Talbot, and Worcester counties will push to rescind the existing funding formula.

In 2007, with State revenues rising more slowly than spending, newly-elected Governor Martin O’Malley called a special session of the legislature and put through tax increases as well as a reduction in the Thornton formula that froze inflation allowances.  In subsequent years, the fiscal landscape grew increasingly bleak, and more trimming occurred.  The accumulated reductions in State aid are now costing local schools about $500 million per year.

Neil Bergsman, Director of the Maryland Budget and Tax Policy Institute has studied a portfolio of possible revenue increases that could help shrink the budget deficit:

·         The alcohol tax has not been raised in decades.  A boost of 10 cents per drink could raise $200 million.

·         In 2007, the General Assembly imposed an additional ¾% income tax on family income above $1 million per year.  Extending this surcharge could raise $100 million.

·         Large corporations currently hide income earned in Maryland from their Maryland income tax returns.  Closing this “combined reporting” loophole could raise $100-200 million.

·         The State’s transportation trust fund has been depleted by transfers in order to balance the budget in previous years.  Business and environmental leaders have called for a 15-cent increase in the gasoline tax, which would raise $475 million.

·         Maryland’s sales tax was raised from 5% to 6% in 2007.  It applies to goods but not services.  Bergsman proposes to decrease the tax back to 5% but add selected services in order to raise up to $1 billion more in general fund revenue.

 In better times, education advocates have been successful.  Last year, the Baltimore Education Coalition took over 600 people to Annapolis for a rally to protect school funding.  The presence of the temporary ARRA funds made victory relatively easy.

 This year will be a real test of the State’s commitment to public schools and of the relative power of parents and teachers as opposed to spending hawks.  Education advocates will need to face the question of whether to back revenue increases to hold onto what’s left of the gains won in the last decade.

 For more information on the Baltimore Education Coaltion's meeting on Thursday, January 13th, visit http://becforourkids.org/. Charlie Cooper is Chair of the Maryland Education Coalition.  He can be reached at charlie.coop@verizon.net.