Sales-tax hike for schools: Wise expenditure or risky investment?

No doubt about it: The statistics are stark.

State colleges and universities are overenrolled by more than 16,000 students, meaning the schools don’t receive enough money for the number of students enrolled. Preschool programs are serving about half of the eligible low-income children in the state. Public-school classrooms are among the most crowded in the nation.

A proposal on the Nov. 2 ballot would use a penny sales-tax increase to funnel $1 billion a year into all areas of education. Supporters describe Initiative 884 as a crucial step forward, at a time when the state Legislature and the local economy are demanding more of graduates than ever before.

But critics say the measure is too costly and the benefits unclear. The proposal would raise the state sales tax by 15 percent, making it the highest in the nation. And even some education advocates have described the initiative as a risky investment, saying there is no consensus yet on how to improve student achievement, or how much money is enough for the education of a child.

“If you wait for the perfect package, you’re going to be standing there waiting forever,” said Steve Miller, of the League of Education Voters, a coalition of parents and citizens that put forward the I-884 proposal. “If we don’t get money in the classrooms, we’re going to have kids failing like crazy to meet the new standards.”

Need for resources

The initiative comes at a time of transition for education reform, which started in Washington more than a decade ago.

The state created a new standardized test, the Washington Assessment of Student Learning (WASL), considered among the toughest in the country. And the Legislature passed a new set of graduation requirements that revolve around that test; students must pass all three sections of the 10th-grade WASL before they get their diplomas.

This year’s freshman class is the first to face the new graduation requirements. And supporters of I-884 say schools will need more resources to push these students past graduation. Last year, only 39 percent of high-school students met the standard on all three sections of the WASL.

And supporters say there is an even more dire need for resources in higher education. If the current pace of funding continues, the Higher Education Coordinating Board forecasts more than 30,000 students could get turned away from community colleges and four-year universities in 10 years.

“What are we going to tell them?” said Miller. “Sorry?”

Spending breakdown

The initiative would create an Education Trust Fund, dividing the money into three areas: preschool, K-12 and higher education.

Half of the money would go to K-12 education, reducing class sizes, adding after-school programs and counselors, increasing college-level courses and raising base pay for teachers.

Forty percent of the money would go to higher education, opening 25,000 additional slots at all public institutions and 7,000 slots in high-demand fields, such as nursing and engineering. The money would also help boost financial aid and scholarship grants.

Ten percent would go to early-childhood education, providing 10,000 new slots in the state’s preschool programs and upgrading the quality of the state program, which currently serves 6,000 children.

Costs versus benefits

State Sen. Bill Finkbeiner, of Kirkland, the ranking Republican on the Senate Education Committee, praised much of the plan, saying it would strengthen pockets of the system. But ultimately, he said, it comes at too high a cost to the state’s recovery from recession.

“You have to always balance these things,” said Finkbeiner. “I think at this time for the state, the cost outweighs the benefits we’d get.”

The initiative would raise the state sales tax from 6.5 percent to 7.5 percent. Add on local sales taxes, which vary from one area of the state to the next, and residents in Washington could end up paying an overall sales tax of nearly 10 percent.

Critics of the initiative say the increased sales tax would push buyers online or across the state border, costing thousands of jobs in retail and construction.

The Building Industry Association of Washington and the Washington Association of Neighborhood Stores have come out against the initiative, as have the Evergreen Freedom Foundation (a public-policy group) and both candidates for governor, Republican Dino Rossi and Democrat Christine Gregoire.

The League of Freedom Voters has led the mostly grass-roots opposition, passing out fliers across the state. The League is a political-action committee formed by the local chapter of Citizens for a Sound Economy, a national anti-tax group.

Former state House Speaker Clyde Ballard, chairman of the League, said he spends most of his time in the car, traveling from door to door.

“I care about kids that get out of school and are not equipped — that’s unacceptable,” said Ballard. “But I’m not convinced that the billion dollars would change that.”

Critics of the initiative say it will only pour more money into a system in bad need of reform. Ballard listed strategies, from performance pay for teachers to school-based budgeting, that he wants to see in the system before he supports a tax increase for new money.

Big-name backers

The creators of I-884 say they designed the proposal with long-term reform in mind. There are accountability measures built into the initiative, they said, and incentives for teachers to get more training for a job that is constantly evolving.

The initiative would create an oversight board with the power to audit legislative spending, as well as school spending. No school is allowed to spend more than 5 percent of its money from the initiative on administrative costs. The governor would appoint 11 members to the board, including citizens and educators from the three sectors of the system.

“One of its main purposes is to get us to honestly work together from preschool all the way through college,” said Terry Bergeson, state superintendent of public instruction.

“This is going to require us to get off our duffs and really work together to have a system that supports kids from the beginning all the way through their college career.”

When the League of Education Voters began the initiative process several months ago, it knew there were plenty of residents who felt an increase in the sales tax would never find enough supporters.

But as the group pushed forward, it collected powerful endorsements from the Washington Education Association, the Children’s Alliance and business leaders from Microsoft to Starbucks. The League has raised more than $2 million so far, with plans to use that money in these last few weeks on radio and TV advertisements.

“It’s clearly a big hike; there’s no free lunch on this,” said Bergeson. “And yet the return on that investment will be enormous for the whole state.”

Past proposals

Voters have shown strong support in recent years for education proposals. Two initiatives put forward in 2000 passed by overwhelming majorities. Initiative 732 gave teachers a cost-of-living raise, while Initiative 728 was designed to reduce class sizes.

In tough budget times, the Legislature has not fully funded either of those mandates. Initiative 884 would set aside money for teacher pay and class-size reduction.

Microsoft put $200,000 behind the initiative, describing it as a sound investment in the state’s economy. Brad Smith, senior vice president at Microsoft, said the need is urgent, given all the competition from other technology-rich states, not to mention other nations, which he said are strengthening their education systems more quickly than the U.S. is.

“We really do think this is likely to be our best opportunity this decade to take a real step forward in improving education in the state,” said Smith.

Education and politics

Across the country, states are struggling with school funding, trying to find new, more-efficient ways to meet the demands of education reform, said Mike Griffith, policy analyst with the Education Commission of the States.

Even as the schools themselves are changing, state legislatures have been slow to reshape their funding formulas, he said. Often the change has come through court battles.

Frustrated by a lack of action, several school districts in Washington filed a lawsuit against the state last month, arguing that the state had not met its constitutional obligation to “amply” fund basic education. Specifically, the lawsuit homes in on special education, one of the costliest programs in any state.

“The big question really is: What are the resources you need to meet the new standards?” said Griffith.

Rep. Ross Hunter, D-Medina, introduced a bill last year that would have taken a look at the state’s decades-old funding formula, with an eye toward what money is needed to boost the system. The bill passed in the House, but stalled in the Senate.

The Bill & Melinda Gates Foundation picked up the research challenge last year, funding a study of how money is being spent in several states, including Washington. The School Finance Redesign Project, a four-year, $5.2 million study, will “follow the money” in different schools, then recommend ways schools can invest in practices that raise student achievement.

“It’s a politically difficult issue,” said Tom Vander Ark, executive director of education for the Gates Foundation, which did not take a position on I-884. “About the only thing more difficult than dealing with other people’s money is dealing with people’s kids.”

Cara Solomon: 206-464-2024 or csolomon@seattletimes.com

SUPPORT THE HFC’S “SHRINK WASHINGTON, GROW AMERICA” PLAN

Click Here To Take Action