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Guest Column Antiquated basic education funding formula is hurting homeowners, students

The Basic Education Funding Formula is the single largest education funding stream in Pennsylvania’s budget.

Until 2014, each year when the General Assembly passed a budget it distributed basic education funding dollars to our school districts based on what they received the year before — regardless of whether the student population grew or shrank.

This led to large disparities throughout the state when it came to where money went versus where it was needed. Some school districts received over 70 percent of their funding for their school programs from the state while other school districts received as low as 30 percent. As you can imagine this led to significant inequality in property tax burdens for homeowners.

In 2016, the Legislature adopted a Basic Education Funding Formula to more equitably distribute state resources according to actual needs. The new formula includes factors reflecting student and community differences such as poverty, local effort and capacity, and rural and small district conditions.

While the funding formula was met with universal praise, its implementation has been remarkably disappointing especially to areas like the Lehigh Valley.

The formula was not applied to the dollars that the state was already spending on schools, but only to new additional dollars allocated after the formula was adopted. Last year only 8 percent of our basic education dollars were distributed through the formula. As a result, Lehigh Valley homeowners continue to be overburdened and our students shortchanged.

This year’s proposed budget isn’t much better.

Only $700 million of the $6.54 billion dollars budgeted for Basic Education, about 11 percent, will be distributed to school districts pursuant to the new formula. The remaining $5.8 billion is set to be distributed based on the allocation used prior to the 2014 budget everyone acknowledges is woefully inadequate. Essentially, 11 percent of our budgeted education dollars get where they are needed.

Presently, the Lehigh Valley’s two largest School districts, Allentown and Bethlehem, are underfunded by $100 million dollars.

There are many school districts getting millions of dollars more than they are entitled to according to the formula and therefore property taxes remain lower in those areas. It is not fair that our property taxes are higher because we are not getting our fair share of education dollars.

In fact, eight of the nine school districts in my senatorial district are underfunded totaling over $40 million, which means our area school districts are left with a difficult decision: either raise local property taxes or cut staff and limit educational programs and opportunities for students. Both choices are unacceptable when the state is not doing its fair share. Remember, these are not one-time revenues, but recurrent dollars.

Whereas I have been advocating for implementing the new fair funding formula for all funds now, I understand that some school districts would lose money. Therefore, I put forward a plan that recognizes the political reality of elected officials voting to reduce money to their school districts with the need to speed up the implementation of the Basic Education formula.

My proposal (Senate Bill 362) recognizes that this cannot be done overnight but needs to be done more quickly. My bill gradually reallocates the state’s basic education funding dollars over a four-year period — broken down into 25 percent increments. It would require that an additional 25 percent of the baseline dollars go through the new basic education funding formula along with newly allocated dollars, until all basic education dollars are distributed under the formula.

There is nothing “fair” about the current system. It’s not fair to our homeowners who have to pay more than they should. It is not fair to our students who are being shorted the money due their schools. And, it’s not fair to our teachers and administrators who are trying to make do with inadequate funding.

I remain a proud and outspoken proponent of eliminating homeowner property taxes and replacing them with a combination of sales and personal incomes tax increases. However, it doesn’t make sense to eliminate property taxes if those dollars won’t be allocated according to the new fairer funding formula.

Coincidentally, this year is the first time the Basic Education Formula is required to be reviewed to evaluate its effectiveness. What exactly will this review conclude about the effectiveness of the new funding formula when only about 11 percent of our basic education funding dollars are actually allocated in accordance with it? How can we ever know if we are funding our schools adequately if we do not put the money where we know it belongs?

The bottom line is simple. We must find a quicker and more effective way to push money through the new fairer funding formula. Our students deserve it, our homeowners deserve it and our teachers and schools need it.

State Sen. Lisa Boscola is a Democrat who represents Northampton County in the Pennsylvania Senate.

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