Another education study with a host of recommendations came forward last week. This time it’s from the Legislative Office of Fiscal Transparency.
Earlier this year, LOFT released a report claiming Oklahoma teachers earned top salaries in the region. It’s not true. But, the analysts had added a couple of subjective factors into the formula to get that result.
That made me dubious going into this next LOFT public school analysis.
This report doesn’t appear to manipulate numbers to the degree of that previous work. But there is over-simplification in some areas, and a misunderstanding of the Oklahoma State Department of Education’s role. So, don’t expect to find out where every education dollar goes; a person must go to local districts for that. This is a macro level view.
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Data in the report is largely gleaned from the Oklahoma Cost Accounting System that local district officials use to input budget information, using about 4,000 different codes.
Still, many of the recommendations have merit, with some having been previously suggested and attempted, only to find political pushback. One of those overdue ideas is updating the funding formula.
Enacted in 1981, the purpose is to provide equity among districts and students. The formula is set by statute and takes into account local taxes and student demographics. It’s intended to provide funding to meet each student’s needs and ensure poor districts aren’t left behind.
The LOFT analysts found it falls short of doing that, particularly for low-income students. The report states what educators have been saying for decades: It takes more money to adequately educate children in poverty. For schools with high numbers in poverty, it’s even more expensive.
While the formula gives an extra weight to an individual low-income student, it does not recognize the needs for districts experiencing concentrated poverty. All surrounding states provide additional resources for schools in this category, the report noted.
It’s a reality many Oklahomans haven’t faced. Poverty rates have a direct correlation to poor academic outcomes. Schools with low State Report Card grades, test scores and graduation rates also have more financially struggling students.
Students in poverty often need supports such as before- and after-school programs, mentoring, field trips, basic necessities and resources for extracurricular activities. Parents often cannot afford to chip in on these programs like in wealthier areas. Things like active PTAs can be difficult to sustain. Teachers become counselors and social workers.
When a school has a handful of low-income students, those weights may be enough to lift those kids. But a school where low-income students make up 50-100% of the population has extraordinary challenges.
The report suggests increasing the weight amount to equal that of other special categories and adding more resources for areas of high percentages of low-income students. The suggested weight is 0.34. I’d probably aim higher.
Funding formula changes always bring protests. Reasonable recommendations were made in 2017, but only one was implemented.
Officials in districts without significant numbers of students qualifying for weighted amounts — high poverty, English language learners, special education and gifted and talented — feel they would lose money. They have a point.
If the legislature doesn’t sink real money into the formula on per pupil funding, just moving existing funds around won’t solve problems. The National Center for Education Statistics puts Oklahoma at 46th in per-student expenditures.
The Legislature held education funding steady this year. With inflation, teachers and staff will feel a pay cut, not to mention the culture was fixed against public schools at the moment.
In modernizing the formula, the Legislature needs to make Oklahoma education competitive, and that takes money.
The LOFT report took aim at the state Education Department’s oversight of the Oklahoma Cost Accounting System.
The majority of funds flow through the Education Department to the 540 local districts, which are governed by elected school boards. Those members are legally responsible for overseas schools including fiscal oversight.
That is the essence of local control. The Oklahoma State Education Department does not have the staffing or legislative authority to audit, investigate, or regulate. It sets minimum standards, general policies and is a repository for data collection.
The agency maintains the accounting system with six employees including one investigator. If something triggers attention, then officials will look into it.
That’s what happened when over $200,000 was reportedly spent on guns and ammunition by districts. It ended up being a human error.
Imagine the staff that would be required for the state Education Department to examine every receipt of all 540 districts. The report’s examples of miscoding amounted to about $6 million, which is 0.1% of state school expenditures.
That’s not a bad error rate.
State Superintendent Joy Hofmeister liked it to the tax system. Everyone sends in tax forms with signatures attesting the information is complete and accurate. Not everyone gets audited. That’s done when a red flag is raised or when chosen in random samples.
The LOFT report recommended expanding that system with financial reviews and bigger samples. Then, the state will need to up funding to pay for that.
Also, for all the talk about high administrative costs, the report lists the districts found to exceed the legal administrative spending limits and the amounts.
The runaway winner was Epic Charter School, going over allowable administrative costs by nearly $7 million, followed by the Epic’s blending learning center charters at $3.3 million. The remaining 12 districts had sharper declines in their overages with a range from $61,000 (Rock Creek) to $200 (Billings).
The Epic scandal has been well-documented and has its founders and chief financial officer facing state racketeering charges.
Another interesting recommendation was to change the law allowing the House Speaker and Senate President Pro Tem to make appointments to the State Board of Education. Currently, the governor appoints all board members.
Perhaps that’s a nod to LOFT being a research arm of the Legislature.
This won’t be the end or even the definitive education report. Another first-of-its-kind examination of funds is expected from State Auditor and Inspector Cindy Byrd, who received a request from Gov. Kevin Stitt. Hofmeister, who heads the agency, is his challenger for the re-election in November.
Byrd has proved to be a fair, accurate and thorough examiner. It’ll be interesting to see if her math and recommendations match that of the LOFT analysts.
Even if not, LOFT reports give an idea of where lawmakers are headed in the next session. While I could quibble with some of the details, the big ideas are worth considering.
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