Friday, May 18, 2018

Grading the Legislature on Education

The 2018 Kansas Legislative session has ended and the campaign for the 2019 session officially begins June 1 when candidates must file if they plan to run in Democratic or Republican primaries. It's a good time to take stock of what happened to the state's biggest responsibility: public education.

Under orders from the Kansas Supreme Court to correct constitutional issues of adequacy and equity, the Legislature has added $400 million in state funding spread over two years (the school year just ending and next year) and committed to an additional $400 million spread over the following four years.

To pay for that increase and fund other state programs, the Legislature also repealed most of the 2012 income tax cuts last session and did not pass another income tax cut this year.

Some legislators argued the additional education funding will not be enough to satisfy the courts and support the state’s educational needs. Others argued it was far too much. Here are some facts.

The $400 million will have increased school funding nearly 10 percent since 2017, the largest increase in almost 10 years. However, when adjusted for inflation, school district general fund, special education and local option budget funding will still be lower than it was a decade ago.

School districts increased teacher salaries an average of $1,200 or about 2.2 percent this year and a similar amount is likely next year. That was the largest increase since 2009. However, it will still leave teacher pay far behind inflation since 2010. According to the National Center for Education Statistics, average Kansas teacher salaries have declined by $4,200 since 2010 when adjusted for inflation.

In 2017, Kansas teacher salaries trailed Iowa by almost $7,500, Nebraska by $4,300, and Missouri by $300, exceeding only Colorado and Oklahoma among our neighboring states. The new funding will help Kansas schools be more competitive, but certainly not close the gap.

Increased funding allowed school districts to add nearly 900 jobs last year, mostly teachers, classroom aides and special education paraprofessionals. However, that is less than half of the total school positions cut since 2009, while enrollment has increased by 25,000 students.

The increased funding equals about $800 per pupil over a two-year period. It is expected to help Kansas make up some lost ground compared to other states. Kansas per pupil funding from all sources was $311 lower than the national average in 2009 but dropped to almost $1,200 lower in 2015, falling from 24th in the United States to 31st. National statistics from other states are not yet available for 2016 and 2017, but because general state aid was frozen under block grant system, Kansas likely fell further behind.

The Legislature also commissioned the first new independent education cost study since 2005. That study made three critical findings. First, higher funding IS strongly correlated with higher student outcome (test scores, graduation rates). Second, Kansas school districts are highly efficient – among the best in the country. Third, 2017 school funding was between $1.7 billion and $2.0 billion short of what it would cost to meet the state's highly ambitious educational goals, which would exceed every other state if achieved.

The new study was validated by an independent peer review, which also found it consistent with a previous study done by the Legislature’s Post Audit agency and cited as evidence in the school finance court case.

These studies are not the only evidence that additional funding will support higher educational outcomes. The states that do better than Kansas on national measures provide more total revenue than Kansas. Until 2009, Kansas K-12 funding consistently exceeded inflation and educational levels have consistently improved: high school completion, college participation and postsecondary attainment is at an all-time high.

Finally, the 2017-18 Legislature increased funding in targeted programs that have proven effective in raising student outcomes, including preschool, mental health services, the Jobs for America’s Graduates program that helps at-risk students complete high school and providing free testing programs for college and career readiness.

Restoring tax revenues and a strengthening Kansas economy also allowed the Legislature to reverse previous cuts to higher education, reduce transfers from highway funding and make up missed payments in the underfunded school retirement system.

While no one wants to pay more taxes than necessary, it should be noted that the state income tax rates are still lower than before 2012. Based on new state revenue and economic projections, total state general spending will remain lower compared to total state personal than any year since 1988. In fact, since the Legislature partially restored tax rates last year, state personal income is growing faster than any time since BEFORE the 2012 tax cuts took effect, and the state’s credit rating has been upgraded.

In other words, over the last two years the Kansas Legislature was able to reinvest in schools and other important programs, found more evidence that school funding increases educational outcomes and kept taxes and spending lower than Kansans previously supported. Now, the court and the voters will give their grades on that record.

Wednesday, May 2, 2018

Kansas v Florida: Student achievement, funding and economic success

Since the 2017 Nation Assessment of Education Progress test results were released, the State of Florida has received a lot attention, especially for high results among certain student groups. Because Florida spends less per pupil than Kansas, some are asking if this shows educational results can be improved without spending more money.

Florida does spend less per pupil than Kansas. However, since 2012 when Kansas passed major tax cuts that reduced state revenue, Florida has actually increased educational funding more than Kansas, with total revenue per pupil in Florida rising from $9,077 to $9,828 in 2015 (8.3 percent) compared to Kansas $11,557 to $12,055 (4.3 percent). Per pupil amounts for 2016 are expected to be released next month. (Source: Public Education Finances, 2012 and 2015)

Supported by this increased funding, Florida has shown improvement on these national tests. However, a closer look shows that low-spending Florida continues to trail far behind Kansas on many measures of student success.

First, it is important to note that NAEP does not test all students in a state. NAEP tests only a statistical sampling of students and only at two grade levels (fourth and eighth) in two subjects (reading and math) every other year. NAEP provides a "scale score" for each state, and also reports the percent of students at various benchmark levels: below basic, at basic, at proficient and at advanced. For a description of limitations and cautions related to NAEP as identified by the federal evaluation team, see KASB Research Specialist Ted Carter's recent blog post here.

For 2017, Kansas actually outscored Florida for all students, with 76.4 percent of students at basic or higher and 38.2 percent at proficient or higher compared to 71.0 percent and 32.3 percent, respectively, in Florida. However, Florida has a far higher percentage of low income students than Kansas. For students eligible for free or reduced meals, 69.0 percent of Floridians scored at basic or above and 27.2 percent were at proficient, compared to 64.1 percent and 22.9 percent of Kansans, respectively. (Source: Kansas Association of School Boards analysis of NAEP data.)

Unfortunately for Florida, students do not graduate and go to college from fourth or eighth grade, and the state does not fare nearly as well in other measures. For example, Florida lags behind Kansas for all students in the four-year adjusted cohort graduation rate, 80.7 to 85.7 percent; for low income students 74.4 to 77.5 percent, for Limited English Proficiency students 60.0 to 77.4 percent, and students with disabilities by the same rates. (Source: National Center for Education Statistics, Public High School 4-Year Adjusted Cohort Graduation Rate.)

Graduation is vital when at least 90 percent of future jobs are expected to require a high school diploma or more and most students will not be able to enter college or technical training programs without it.

What about preparing for college? Kansas and Florida both tested the same percentage of students last year using the ACT test (73 percent), but in Kansas 29 percent of students met all four college ready benchmarks, compared to just 21 percent in Florida. Kansas schools are sometimes criticized because less than one in three students score college ready on all ACT tests; in Florida it is barely one in five. ACT does not break out results by income level, but Kansas also outperformed by every ethnic/racial subgroup except Hispanics. (Source: 2017 ACT State Briefing and Profile Reports)

Better preparing students for college is critical because almost all job and income growth is in careers requiring education beyond high school.

Finally, Florida trails Kansas in every measure of educational attainment by young adults (aged 18-24). In Kansas, 12.5 percent of this age group has not completed high school or the equivalent; in Florida, it is 15.5 percent. In Kansas, 48.5 percent of young adults have some college education, one- or two-year certificate or an associate's degree; in Florida the percentage is 45 percent. In Kansas 10.3 percent of 18-24-year-olds have a four-year degree compared to 9.0 percent in Florida. (Source: American Community Survey, Educational Attainment 2016 one-year estimates)

Higher levels of educational attainment results in higher earnings and lower unemployment rates, qualifying students for higher paying jobs and attracting employers who need these skills.

Why is there such a gap between Florida NAEP scores and other educational indicators? First, it is likely that the additional spending over the past several years has made an impact on younger students. The Governor of Florida, Republican Rick Scott, has credited additional spending on education for rising NAEP scores. Focusing resources on preparing students for standardized tests may improve that measure, but apparently Florida is not yet providing the support or effectively implementing strategies to help prepare students more broadly.

Kansans participating in community forums conducted by the Kansas State Board of Education overwhelming supported a broader definition of academic success than standardized test scores.
The question is this: would Kansans trade higher scores for low income students at fourth and eighth grade and spending about $2,200 less per pupil for doing worse on every other major measure of preparing students to be successful after high school?

KASB will release its updated “Comparing Kansas” Report on educational outcomes and funding this summer. Past editions have found that every state exceeding Kansas across all measures spends more than Kansas. Recent academic studies have found a strong positive correlation between funding and student success. So did the most recent education cost study commissioned by the Kansas Legislature.

Noted above is the fact that Florida has more low-income students than Kansas. Some have suggested that Florida gets better educational results than Kansas while spending less money. We've seen that isn't true when looking at a broader range of outcomes. But it is also argued that spending less on education and other public services boosts a state's economy. As a low-tax, low-spending, zero income tax state, Florida should also be a model for economic prosperity.

It turns out that is not the case, either. Florida trails Kansas in per capita income, $46,858 to $47,600 in Kansas. Florida has a higher unemployment rate than Kansas, 3.9 percent to 3.4 percent (after Kansas raised income tax rates last year). Florida has a higher poverty rate for all residents, 14.7 percent compared to 12.1 percent in Kansas, and a much higher poverty rate for children under 18, 21.0 percent to 14.1 percent. (Source: Bureau of Economic Analysis, State Personal Income; Bureau of Labor Statistics, State Unemployment Rates; American Community Survey Factfinder.)

Florida has made solid gains on one national test, but when looking at all other student achievement measures, Kansas schools put students in a much better position to succeed. Increased funding from the Legislature will help them continue to do so.

Monday, March 26, 2018

What we learned from the new Kansas school finance study, and what it confirms that we already knew

The new Kansas education cost study offers a way to establish a long-term plan to fund long-range goals that can make Kansas the leading state in student educational attainment, which will increase earnings and employment, attract high wage jobs to Kansas for high skill workers, and reduce poverty and social service costs. No investment is more important to our future prosperity. 

Here are the key points from the study, and why its findings are not really surprising. 

First, the amount of money does make a difference in educational outcomes. 

According to the report, the analysis finds a strong, positive relationship between educational outcomes and educational costs, once differences in scale, need and price are taken into account.” In other words, higher spending equals higher results. 

How does that finding compare to other research? This is the same finding as the 2006 Kansas Legislative Post Audit study, which found a nearly one to one correlation between spending and results based previous Kansas assessments results and funding. 

It is also the same as a recent report based on a comprehensive review of the high-quality empirical evidence on whether and how money matters in education, written by Rutgers Professor Bruce Baker. Baker concludes that, “on average, aggregate measures of per-pupil spending are positively associated with improved or higher student outcomes,” while “schooling resources which cost money … are positively associated with student outcomes.”  

Finally, it’s the same KASB research reports on other states, the past experience of Kansas comparing increased funding and educational outcomes, and the cost of specific educational programs and strategies to improve results. 

Second, Kansas has highly efficient schools. 

The new report found that Kansas schools were producing nearly 96 percent of their potential output, on average. Given that inefficiency in this context means unexplained expenditures, not necessarily waste, and that many buildings may have been producing outcomes that were not reflected in test scores, the average efficiency level was quite high.” 

How does that compare to other measures of Kansas efficiency? KASB’s Comparing Kansas report has found that Kansas ranks in the top 10 states when averaging 15 measures of student outcomes, yet spends below the national average. Every higher-ranking state spends more per pupil, and no state that spend less than Kansas has higher overall outcomes. Unfortunately, Kansas results have been falling compared to other states that have been investing more per pupil over the past decade. 

Third, it costs significantly more money to reach significantly higher outcomes. 

The report says it would take a 38.4 percent increase funding ($1.886 billion) to achieve 95 percent graduation rate and to get 90 percent of Kansas students to “grade level” on reading and math tests in five years, and a 44.4 percent increase ($2.067 billion) to get 60 percent of Kansas students “on track for college ready” in the next five years with a 95 percent graduation rate. 

Setting a lower goal with a 90 percent graduation rate would require an additional 28.5 percent ($1.326 billion) to reach 90 percent on grade level and 34.1 percent ($1.587 billion) to reach 60 percent on track for college. 

How does that compare to the highest achieving states? From the Comparing Kansas report, the top nine states had an average 88.2 percent graduation rate in 2016In 2015, these states have an average of 79.7 percent of students at the “basic” level in reading and math on the National Assessment of Educational Progress. Kansas had 76 percent of students at basic, compared to 72.5 percent of students at “grade level” on state tests. The top nine states had 42 percent of students at the “proficient.” Kansas had 36 percent at proficient, compared to 36.3 percent of students on track for college on state tests. 

These nine states that exceed Kansas on educational outcomes had average operating expenditures per pupil of $14,616, or 31 percent higher than Kansas at $11,106 – when adjusted for regional cost differences. (Without the regional adjustment, these nine states spend 47 percent more in operating costs.) 

In other words, the highest achieving states in the nation spend 31 percent per more pupil to achieve lower graduation rate and assessment rates than “lower” goals for Kansas in the new report, so it is reasonable to assume it would take a 44 percent increase to reach even higher goals. 

Fourth, additional funding can be phased-in over time. 

The report noted the importance of appropriately using new investments over time. It is not practical to make a one-time, significant investment in a statewide public education system and expect at the end of that school year to see dramatic movement from current performance to the aspiration targets. Alternatively, making ongoing and incrementally larger investments in the system over time with established targets may be more practical for practitioners to plan and determine the appropriate ways to invest the funding. One consideration is to consider these investments over a 5-year period of time. 

What has happened with previous funding increases? The Kansas Supreme Court essentially allowed a four-year phase-in following the Montoy decision in 2005. Adjusted for inflation (2017 consumer price index), general operating funding increased from $3.842 billion in 2005 to $4.700 billion in 2009; a 22.3 percent “real” increase (over inflation) over five years. 

Over a much longer period, general operating funds increased from $3.250 in 1990 to $4.701 billion in 2009 (adjusted to 2017 dollars) or 44.6 percent (about the same percent increase called for in the report for the higher level of outcomes)Since 1990, the percent of Kansas adults with at least a high school diploma increased from 81 percent to over 90 percent; the percent with some college but less than four years increased from 27.3 percent to 35.5 percent, and the percent with four years or more of college increased from 21.4 to 32.2 percent. 

These increases in adult education levels have boosted Kansas earnings by over $6.2 billion compared to 1990 education levels, because more educated employees earn substantially more. This increase compares to an increase in total K-12 funding of $2.2 billion (inflation adjusted) since 1990. 

However, since Kansas funding peaked in 2009 when adjusted for inflation, scores have fallen on both state and national tests, graduation rates have been flat, the percent of students scoring college-ready on the ACT has dropped, and more states are surpassing Kansas in both funding and achievement. 

Fifth, the Legislature has multiple options. 

The choice is not between doing fully funding the recommendations in a single year or doing nothing. The study allows Kansas to set long-term goals for education and a plan to fund them.