The ABCs of K-12

Adults across Ally Garcia’s home state are arguing about how schools get money, whether they have enough and how the issue will affect Colorado’s economy in the future.

But Garcia, a senior at Pueblo West High School, doesn’t have time to worry about all that. She’s done her own math.

Education equals opportunity. To get the best of both, she needs to go to college. To get there, she needs good test scores. To get those, she needs to study.

That’s where things get tricky.

At Pueblo West, there aren’t enough books for each student to have one in her science, math and English classes. The books have to stay in the room, unless a student is among the first to request one to check out for homework. So Garcia comes to school early in the morning or stays late after school, hoping for a chance to use a book.

This year, she bought her own biology book from another school district.

“I’m really pretty much willing to do anything to learn,” said Garcia, who wants to become a school superintendent or college dean.

The situation is not unique to Pueblo West. Other schools across Colorado – including some in metro Denver – don’t have enough textbooks for their students. Garcia worries that she and the others aren’t learning the kind of study habits that will help them through college. She said teachers often simply don’t assign homework because there aren’t enough books.

“This really puts us behind,” Garcia said. “It feels like you’re fighting just to do what you’re supposed to do – learn.”

At the same time, the fight over public education costs rages on across Colorado, made ever more urgent by Referendums C and D on the Nov. 1 ballot.

Colorado voters will be choosing between keeping an estimated rebate for themselves averaging about $100 a year for five years or letting the state keep that tax money, expected to total some $3.7 billion. About a third of that money is pledged to education.

Leaders on both sides of the referendum issue say a large part of the public doesn’t understand one of the most controversial – and crucial – areas of the state budget: K-12 education, which will spend about $4.5 billion in state and local funds this year to educate 738,000 students statewide.

Only five years have passed since Coloradans approved the last statewide ballot issue affecting education – Constitutional Amendment 23, designed to guarantee funding levels for K-12. It aimed to stop what voters saw as an erosion in spending that had whittled Colorado’s state support for education from among the top in the nation to near the bottom at that time.

One of the richest states, based on personal income, was among the least in spending its money educating its children.

But Amendment 23, for a variety of reasons, hasn’t worked exactly as planned. Now voters must decide if schools in Colorado need another fix.

What would it mean for schools if voters approve the measures?

“If C and D pass, we tread water,” said Lisa Weil, co-founder of Great Education Colorado, a statewide, nonpartisan organization that backs the referendums.

But if Refs C and D fail, the answer is not so clear.

Economists for Gov. Bill Owens estimate $365 million would have to be trimmed from next year’s state budget if the referendums fail. Educators say that would translate to as much as $150 million in program cuts for K-12 education.

Even though Amendment 23 was designed to protect education from budget cuts, it doesn’t apply to the entire school-finance formula. So lawmakers can – and have – found ways to cut portions of education’s budget.

And although the total amount of money appropriated to K-12 by legislators has gone up by more than a third since the 2001 recession, it hasn’t been enough to keep up with rising costs for transportation, health care and students with special needs.

Education leaders say some districts could face cuts of up to $100,000 per school.

Monte Moses, superintendent of the Cherry Creek School District, said if Refs C and D fail, he would expect a 2 to 4 percent cut in his budget.

“That seems like a little bit, but it could be a teacher or two at each school,” he said. “I don’t want to scare people. We’d look for cuts outside the classroom first, but we’ve already made reductions there. We’d be at the point of making cuts that people wouldn’t like to see.”

Moses said he would expect cuts in transportation and technology first.

“But parents and the community probably wouldn’t think it was great if students had to walk farther because there was no bus, or wait longer because there were fewer, or not have the technology they’d expect,” Moses said.

$10,000 per student

Opponents of the measures point out that when you add up what schools receive from the state, local and federal governments – plus any bond measures or additional property tax revenues voters approved locally – schools get an average of more than $10,000 per student. The state portion is about $6,000.

“I’m really not convinced that K-12 needs all this money,” said Beth Skinner, with Colorado Freedom Works, which opposes Refs C and D. “In a classroom of 30 kids, $300,000 per classroom a year isn’t enough?”

But school administrators say there are several factors behind those numbers to consider.

For instance, Colorado has a lot of rural schools, which require the same things urban schools have – gymnasiums, science labs, janitors, support staff and teachers for the major subjects, even for schools with few students. So the cost per student in a rural school is much higher.

Plus the state has growing numbers of students who need special services.

Unlike many states, Colorado pays only a fraction of the costs of special education for kids with mental, physical or emotional disabilities. The same is true for students learning English. Add costs for transportation and vocational education, and Colorado covers only 28 percent of what its schools spend for these services.

The shortfall must be carved from the money allotted for the rest of their student body.

The state’s current school funding formula – which grows education funding to reflect enrollment and the rate of inflation plus 1 percent – isn’t keeping up, school officials said.

“The system is broken,” said Vody Herrmann, school finance director for the state Department of Education.

Yes, the system is broken, said state Treasurer Mark Hillman. But Hillman is one of many opponents of Refs C and D who say a large part of the problem centers on Amendment 23. Hillman said he thinks the referendums are on the right track – that TABOR needs tweaking.

But he’s going to vote against them because he says Amendment 23 needs changing at the same time.

“The problem with Amendment 23 is even when the overall budget declines, Amendment 23 exacerbates the problem by forcing your biggest piece of the pie to increase,” Hillman said. “It makes budgeting inflexible in a recessionary time.”

Education takes 44 percent of the state’s general fund – $2.7 billion this year out of that main account.

Many educators, parents and community leaders support Refs C and D, pointing to data showing that K-12 funding has not kept pace with inflation since 1988.

That year is significant, because Amendment 23, approved by voters in 2000, was designed to bring spending back to 1988 levels, adjusted for inflation and enrollment growth.

Opponents of Refs C and D say state spending on education has kept pace with inflation – indeed, outpaced it – since the amendment was passed in 2000. Current spending should be enough, they say.

During the past four years, lawmakers have balanced the state’s share of the education budget by making cuts in K-12 programs, finding federal and private grants, or using funds that were supposed to finance future education costs.

Those moves resulted in a total of more than $120 million in cuts to education programs since 2002.

“I’ll guarantee that made a dent” in the quality of Colorado’s schools, said state Sen. Norma Anderson, R-Lakewood, who sits on the legislature’s school finance committee. She supports Refs C and D.

Schools in need

Fan out across the state, beyond Ally Garcia’s school, and you can see the dents Anderson speaks of.

In Kersey, at the 1,100-student Platte Valley School District, they’ve cut driver education, music and a chunk of their custodial service. They haven’t been able to hire a physics teacher for two years, resulting in a less-than-successful attempt by some students to learn physics online. They have no real program for gifted students, even though the state will require all schools to have one next year.

At Eaton High School in Weld County, three separate engineering companies have said the building that houses 436 students is unsound. This year officials discovered that the supports holding up the high school were rotting.

In Denver, at East High School, foreign language classes are full. The school says it can’t afford more teachers, so no freshmen will be able to graduate with four years of foreign language study.

In Summit County, home of Breckenridge and other ski resorts, enrollment growth helped the high school receive about $180,000 more in state funding than last year. But a 13 percent increase in staff health-insurance costs will cost nearly twice that.

Each year, the district has increased the portion employees must pay, decreased the benefits and absorbed some of the costs.

Compare that increase, or the district’s 25 percent hike in fuel costs, with the increase in state funding for schools this year: 1.1 percent, including an inflation rate of 0.1 percent.

“It doesn’t even come close to covering the increased costs,” said Dan Huenneke, director of Summit’s business services.

With the recent dramatic increases in fuel prices, transportation costs have risen ever higher. Also on the horizon are the federally mandated No Child Left Behind requirements. Educators are trying to estimate what they think it will cost to raise each child to those levels of achievement.

And this year, education advocates in Colorado filed a lawsuit charging that school funding levels have made the education system less than “thorough and uniform,” as the state Constitution requires. They estimate schools would need up to $1 billion more every year to fix the system.

Catching up to 1988 levels

Meanwhile, the state is still trying to catch up to where it was in 1988.

Amendment 23 was supposed to make up some of the lost ground and release K-12 education from the restrictions of the Taxpayer’s Bill of Rights passed in 1992. TABOR created the tightest limits on state spending growth in the nation and gave voters control over tax increases.

But Amendment 23 hasn’t worked exactly as envisioned.

It called for putting a third of a percent of all federally taxable income in Colorado, both individual and corporate, into what is essentially an education savings account. That’s been about $300 million a year. The fund, exempt from TABOR, would grow with interest and help cover future education costs.

But in recent years lawmakers have taken more money out of the fund than went into it. Under rules in effect during an economic slowdown, they have drawn more than $150 million from the education fund since 2002 so they could leave more money in the general fund for other areas of the budget. By the start of this fiscal year in July, only $121 million remained.

At the current rate of withdrawals, the education fund is expected to be depleted by the end of the decade, leaving the general fund to pay billions that the state doesn’t expect to have.

Seeing that danger, lawmakers this year pulled more from the checkbook – the general fund – to protect the savings account – the education fund. To do that, they had to squeeze even more from other areas of the budget.

“My colleagues in other agencies kind of glare at me because they don’t have an Amendment 23 to protect them,” said education Commissioner William J. Moloney. “Other agencies have taken much more severe cuts. K-12 had to be protected.”

How much is enough?

Education has not been entirely spared.

In 2004, the state cut more than $20 million – 6 percent – from funds meant to help smaller schools and at-risk students.

Lawmakers cut funds for reading programs, textbooks and breakfast programs for low-performing schools. They eliminated, for a time, payments required by the settlement of a lawsuit on behalf of students in poor, rural districts whose schools, in some cases, have serious health and safety issues. Part of the money from the referendums – $147 million – would go to meet the obligations of this settlement.

This year, Colorado plans to spend an average of $6,285 per student on education. In 2003, Colorado ranked 25th in state and local funding per pupil, but state funding per-pupil was only 48th relative to personal income in 2002.

Current funding should be adequate, says treasurer Hillman. It should cover getting students to and from school, teaching them the basics, feeding them and paying any administrative overhead, he said.

“I don’t think things are as dire as some voices would have you believe,” Hillman said.

Depends on your standards, says Moloney. “No agency head is going to say every dollar lost is absolutely critical,” Moloney said. “There are always ways you can economize.” But some cuts are one-time savings, he said. “Then you have to worry about next year and the year after.”

The education department has cut a dozen jobs. Federal funds now cover 75 percent of personnel costs, instead of half. The administration staff is 26 percent smaller than it was 20 years ago. Library program staff has been cut by almost half.

Now, for instance, instead of gathering teachers for training on successful strategies by other districts, Moloney said, someone at the department simply picks up the phone and suggests one district contact the other.

“Instead of being able to train professionals, you’re reduced to saying, ‘You ought to call them,’ ” Moloney said. “It’s not entirely satisfactory.”

Moloney said he also is bothered by missed opportunities.

“There have been times when we’ve seen federal grants and thought, ‘That would be good,’ but we don’t have the matching money, so we can’t apply,” he said.

Looking at efficiency

Even if the ballot issues pass, “there will never be enough money,” said Pam Benigno, director of the education policy center at the Independence Institute, a Colorado think tank that opposes Refs C and D. Benigno’s solution: Cut more waste, become more efficient.

“We all want good teachers,” said Benigno, a former teacher. “But if you have a below-average teacher paid at the top of the salary schedule, that’s wasteful.”

Benigno’s center says teacher pay should be based on performance.

But would that save money?

Denver residents will vote next month on a $25 million plan to give teachers pay incentives for high performance or willingness to work in hard-to-staff schools. It’s patterned after a program in Douglas County. The state was working on its own pay incentive program until it was cut to save $13 million.

Benigno says such programs fall short because they don’t address low-performing teachers.

“The system needs more flexibility in hiring and firing,” she said.

“It can cost $100,000 to rid a district of a really bad teacher because of legal costs. Many small districts just can’t afford it.”

Benigno cites another top target for rooting out potential waste: administration.

Last year, lawmakers asked the state auditor to start “efficiency reviews” in a few districts to look for cost-savings ideas. But there was no money for the program, and it died before it started.

“I always think school districts need to look at administration and make cuts,” Benigno said.

That wouldn’t take long at the Platte Valley School District in Kersey. “The central office is me,” says Superintendent Glenn McClain.

At least it was until McClain hired a business services officer who helps track accounting, food service, operations and maintenance for the district of 1,100 students.

Even with a second administrator and the school board’s expenses, the central office takes 5 percent of the budget, less than the 11 percent national average. The extra officer leaves McClain more time to worry about instructional strategies.

“This sounds terrible; I’m almost embarrassed to say it,” McClain said. “We don’t have dollars set aside for textbooks every year.”

The district tries to keep its books on a five-year rotation, but the high school trigonometry books are 10 years old. He’ll scrounge for trims here and there so students can have new math books next year. Then he’ll start worrying about history books. But McClain said he has few tricks left up his sleeve.

Growing districts get more money, but those with flat or declining enrollment are in trouble, he said.

“We grew by two kids last year,” he said.

“But we had fewer on free and reduced lunch, which you would think is a good thing. But we got less funding because of it. We actually lost $23,000, and we didn’t find out until November or December.”

School funding is based on the number of students as of Oct. 1. It’s almost halfway through the school year before districts learn how much the state will give them.

“People say schools need to plan better, but how can we?” McClain said.

McClain is pinning his hopes for more revenue on voters approving a mill levy override, which would allow local property tax rates to remain at current levels instead of decreasing, as the tax law directs.

Colorado voters have approved two-thirds of school bond requests in the past two decades. A 2003 Mind of Colorado poll found seven of 10 Coloradans favor Amendment 23, even if it means more severe cuts to the rest of the budget.

It’s clear Coloradans support education. It’s also clear – by the support for TABOR – we like our taxes low. The question Nov. 1 is whether the state will have to choose between the two.

Misconceptions about K-12 education in Colorado

• Myth: Amendment 23 solved funding problems with K-12 education.

Reality: The education fund that Amendment 23 created hasn’t grown as expected because lawmakers have used more of the money than originally planned to offset spending in other areas of the budget.

• Myth: Total funding for K-12 has gone up about 70 percent in 10 years, so it doesn’t need any additional funding.

Reality: Funding has gone up largely because the state has grown in population – students with special needs, English language learners, at-risk students and other factors that increase the school-finance formula. The bottom line is that funding has not grown at the same rate as costs.

• Myth: If Referendums C and D pass, then schools will be flush with money.

Reality: If C and D pass, lawmakers say they will use $1 billion to shore up the faltering education fund, which is supposed to pay for future education costs; pay a lawsuit settlement that requires fixing crumbling schools in poor districts; and restore some of the cuts to programs, such as preschool and full-day kindergarten.

• Myth: Teachers’ salaries are rising too much.

Reality: The most recent data available show the average state teacher made about 3 percent less in 2003 than in 1990, when adjusted for inflation. In fall 2004, the average teacher had more than nine years’ experience and was paid $43,965.

Refs C and D at a glance

• Referendum C would allow the state to keep an estimated $3.7 billion in revenue over five years that otherwise would have to be refunded under spending limits of the Taxpayer’s Bill of Rights. The state estimates that would cost taxpayers an average of $490 over five years, or $100 a year.

• Referendum D, which only takes effect if voters approve it and Ref C, would allow the state to issue bonds to borrow against the expected revenues and devote money immediately to roads, schools, and the police and firefighter pension funds.

• This is what the state says it would do with the money.

30% for K-12 schools: textbooks, libraries, kindergarten and preschool, in-classroom instruction

30% for health care: For elderly, low-income and disabled people, programs to lower health insurance costs for individuals and small businesses

30% for community colleges and state colleges: Need-based financial aid, merit-based financial aid, College Opportunity Fund Program, which gives $2,400 a year directly to students to apply toward tuition costs

10% Repayment of Referendum D bonds, which break down as follows:


Work on 55 projects approved by the Colorado Department of Transportation:

$1.7 billion


Capital funds to repair dilapidated buildings in the poorest school districts. Typically, districts match each $2 from the state with $1 locally, which means $220 million in total improvements:

$147 million


Improvements and repairs to facilities at university, colleges and community colleges:

$50 million


Colorado’s share of the state-local match to the pension fund, which the state has deferred for several years because of the budget crunch:

$175 million

Cuts to K-12 education

Since 2002, lawmakers have made more than $120 million in cuts to K-12 education, which took $4.4 billion in state and local funds this year, including $2.7 billion from the state general fund. All the cuts fell outside the boundaries of Amendment 23’s guaranteed funding increases each year through 2011. The cuts included:

• $42 million from funds that schools receive annually for at-risk students, for costs related to the size and cost of living in each district, and for classes taught via the Internet.

• $38 million from other discretionary spending, such as full-day kindergarten, a pay-incentive program for teachers in struggling schools, and updating textbooks.

• $20 million from money the state pledged to spend annually on fixing dilapidated schools when it settled a lawsuit with several poor districts.

• $11 million annually for grants and library programs, including the Talking Book Library, which provided materials to people with visual, physical or learning disabilities.

• $6.7 million by cutting 2,000 preschool slots for two years.

• $3 million by eliminating annual funding for a contingency reserve fund for school districts with financial emergencies.