Gov. Doug Ducey’s proposed budget will shortchange schools and child welfare programs, insist child advocacy groups.
They have urged the state to use more promised federal money to make up for the heavy funding losses schools have suffered during the pandemic, rather than enact an additional $600-million income tax cut the budget proposal calls for.
The decline in enrollment and state formulas that pay less for students in distance learning have cost school districts throughout the state heavily, compounding the impact of the pandemic, said the Arizona Education Association.
That includes a more than $4-million cut in funding from school districts in Apache and Navajo counties due to the forced shift to distance learning, according to recently released state estimates.
Districts across the state have been battered by a 50,000-student decline in enrollment. The state promised to limit the loss in funding to 2% when it ordered schools to shift to distance learning in the spring. However, the enrollment drop proved so severe that the state pulled back on its guarantee. Many districts lost 5-10 % of their funding as parents kept students home or shifted them to other online programs or charter and private schools.
Moreover, the state pays 5% less per student in distance learning programs. That formula also cut school funding. The schools districts in Apache and Navajo counties lost some $4.1 million from that alone. That includes $102,000 at Blue Ridge, $107,000 in Show Low, $44,000 in Snowflake, $217,000 in Holbrook, $493,000 in Winslow and $900,000 in Chinle.
Statewide, the loss amounted to $266 million, according to state budget figures.
Education advocates say applying the distance learning formula to the enforced shift this year isn’t fair. The lower state funding formula is based on the assumption that full-time online programs don’t have to provide the same infrastructure as districts that hold in-person classes. The existing full-time distance learning programs have been controversial for years due to an extremely high dropout and non-completion rate as well as different standards for teacher certification and experience. However, this year districts all had to set up improvised, temporary distance learning programs while still maintaining brick and mortar facilities. Moreover, districts had to absorb other upfront costs, like computers for students to work on, new curriculum, teacher training and additional tech support.
Arizona Education Association head Chuck Essigs says the governor’s proposed budget would lock in those funding losses. Moreover, districts don’t know how to deal with the substantial enrollment decline, since they have no idea how many of those students will return after the pandemic subsides.
“A good example is for kindergarten students, we’re down more than 10%,” Essigs said. “What we believe is happening is some parents are saying, ‘I’m not going to send my student to kindergarten this year, I’m going to wait until next year. If you were a district that lost 5% of your students to declining enrollment and lost another 5% in funding because of the distance learning program, you’re operating with 10% fewer dollars than you would have normally had and you’re still providing services. Districts are having a really difficult time financially, because of the loss of students, but in addition that 5% loss of funding when students are in distance learning.”
Even before the pandemic, the state auditor general concluded 13 districts in the state were at high financial risk, including the Cedar District in Keams Canyon on the Hopi Reservation and the giant Tucson School District.
The state had feared the pandemic would crush sales tax collections and result in a $1.1 billion state budget deficit. In fact, the economy performed far better than expected. Moreover, the federal government provided so much in relief funding that the state reserve fund actually grew. The second federal COVID bailout includes another $1.1 billion to help Arizona schools, about four times as much as the state got in the first round of the CARES Act.
Gov. Doug Ducey’s plan for the upcoming fiscal year essentially cuts school funding by nearly $400 million due to pandemic-related changes in the funding formulas.
“We would hope that the state would realize that the additional burden on schools is a real problem, the Enrollment Stability Grant is way underfunded in terms of what districts need, and that they will use some of the savings that the state is experiencing to help school districts with the struggles that they’re facing,” Essigs said.
The second round of school relief nationally includes $52 billion to help schools compensate for “learning loss” as well as facilities and technology upgrades. It also includes $4 billion to help private schools, $23 billion for colleges and universities and $818 million for Bureau of Indian Education schools, many hard hit by shutdowns and high rates of spread compounded by a lack of technology and internet connections to support distance learning options. The package includes an additional $3.2 billion to help provide broadband for low-income families.
Studies show the abrupt shift to distance learning had the biggest impact on low-income families and minorities — including Native Americans. Districts serving those students often had fewer distance learning options and those families often had trouble staying connected.
The Children’s Action Alliance has supported the pleas of educators in hopes lawmakers will provide more support for schools and children than offered in the governor’s initial $13-billion budget proposal.
The leading children’s advocacy group in the state noted that the projected $1.1 billion state budget shortfall turned into a $370 million surplus. The state ended up with $1.1 billion ending cash. The governor’s proposed budget would still leave a $923 million revenue surplus for the upcoming fiscal year.
The governor’s proposal included $600-million, three-year tax cut, on top of the $386-million tax cut enacted in 2019. The tax cuts would lower state revenues by $1 billion annually by the time they’re phased in. However, the budget would leave Arizona near the bottom when it comes to per-student funding, teacher salaries and class sizes.
The Children’s Action Alliance urged the Legislature to make up the $400 million in funding schools have lost due to funding formulas, increase subsidies for child care, double the subsidy for relatives serving as foster parents and expand healthcare coverage for low-income children.
The group praised some provisions of the governor’s budget, including $18 million to continue a childcare wait list, $92 million in extra funding for child care centers and $10 million to bolster the Rural Broadband Grant Program.
In a release to the press, the group concluded, “In the coming weeks, Governor Ducey and lawmakers will begin to negotiate what the final budget will look like. With so much economic uncertainty still present, we will continue to urge them that now is not the time for more tax cuts and they should instead pass a budget that puts the needs of Arizona’s children and families first.”