Madam President: I hereby exercise my right under Article 2, Section 10, of the Kansas Constitution to protest Senate Substitute for House Bill No. 2655.
After submission of a bill at the rail on Monday, March 21, assignment of a bill number (Senate Bill No. 515) on Tuesday, getting the bill in print by early evening and a rushed committee hearing on Wednesday that provided no meaningful opportunity for testimony from the many districts impacted by the passage of this bill, this body now rushes to judgment to enact this bill (Senate Substitute for House Bill No. 2655) that demonstrably harms equity rather than curing the equity defects found by the Kansas Supreme Court. The bill does nothing to actually equalize purchasing power between districts due to differences in local wealth. Furthermore, it is a freeze of equalization payments at the current levels accomplished through the artifice of a “hold harmless” provision that benefits wealthier school districts at the expense of poorer districts. It also harms equity by effectively expanding LOB authority only for districts wealthy enough to afford local property tax increases. This supposed “equity” bill is the very definition of a constitutionally inequitable bill.
Given the time constraints imposed on the Legislature by the Supreme Court’s decision, which was itself precipitated by this body’s unconstitutional actions, prudence would have dictated that the Legislature take as its guiding star a system that has been repeatedly found by the District Court Panel and the Supreme Court to be constitutionally equitable; namely, the old equalization formulas. Those formulas, in combination, pass the Supreme Court’s equity test; this bill does not. The bill continues to create “winners and losers” as the attached chart and spreadsheet graphically demonstrate by comparing the bill’s effects to the old equalization formulas previously found constitutional. My school district, Topeka USD 501, testified against this bill in the house and presented the spreadsheet and chart below along with their written testimony yesterday. The data was not presented to the Senate Committee and I want the entire Senate to have the benefit of reviewing this information.
When compared to the old equalization formulas, the bill’s disastrous effects on equity become apparent. The bill essentially switches the Local Option Budget (LOB) equalization formula to a less generous equalization formula than was previously authorized. While the capital outlay equalization formula might have been approved for capital outlay it was not approved for LOB. LOB is a much larger component in classroom funding. This is the direct result of this body attempting to construct a formula based not on educational reasons for the funding, but rather based on the amount of money politically deemed available in the State’s checkbook. The bill prorates down the amount of LOB equalization to fit current dollars. Such a proration has been specifically found to be unconstitutional by the Supreme Court in Gannon I.
In addition, the hold harmless provisions in the bill (called “school district equalization state aid” in the bill) allow wealthier districts to retain more resources and thus retain the ability to provide more educational opportunity. This allows the wealthier districts to keep the advantage given to them by the block grants enacted under 2015 House Substitute for Senate Bill No. 7 and their wealth. This runs directly counter to the purpose of equalization aid which is supposed to “equalize” purchasing power. The bill instead ensures that the wealthier districts retain their advantages over less wealthy districts and thus fails the equity test.
Additionally, the bill’s system allows wealthy districts to game the equalization system in a way that less wealthy districts cannot. For example, Shawnee Mission USD 512, a district that regularly touts their ability to pass increased local school mill levies, could raise their mill levy to completely backfill the $3,040,285 amount they lose in LOB equalization aid under the Supposed Equity Bill’s LOB equalization formula. In addition, they would then receive an additional $3,040,285 in “hold harmless” money, thereby allowing them to increase spending by $3 million dollars over the block grant. On the other hand, Kansas City USD 500 also loses $2,502,864 in equalization aid. However, Kansas City is much less likely to get taxpayer approval for an increased local school mill levy to backfill this loss. The “hold harmless” money Kansas City receives will be only $1,240,706, resulting in a decrease in LOB funding to Kansas City by $1,262,158 over the amount granted under the block grant bill. This does not result in substantially similar educational opportunity through similar tax effort.
The bill also continues the cannibalization of equalization funds that the courts have repeatedly been found to be unconstitutional. By ensuring that any gains in capital outlay equalization are then deducted against any “hold harmless” money the district would receive, it harms the districts that receive capital outlay equalization compared to districts that do not.
Additionally, local school mill levies continue to range from 7.87 mills in Meade to 44.4 mills in South Haven for providing the same educational opportunity. This might have been acceptable to the Court had we used their safe harbor and simply re-adopted and funded the old formulas, however, since we did not, the new scheme must pass the equity test. Under the bill’s system, districts will be incentivized to shift more funding locally to backfill the loss of LOB aid due to the less generous LOB formula. This will only exacerbate the range of tax effort required to obtain “similar educational opportunity.” It violates the Supreme Court mandate that “School districts must have reasonably equal access to substantially similar educational opportunity through similar tax effort.” This tax effort difference is not even close to “similar.”
The Topeka Public Schools are already being forced to consider proposals to raise their LOB mill levy in order to make up for losses incurred through the operation of the block grants. The bill means that Topeka taxpayers will face even higher potential local tax increases just to stay even. For districts like Topeka and other less wealthy districts, the bill can only be viewed as yet another package of concessions for wealthier, more politically powerful districts that continues to arbitrarily reassign winners and losers. This merely furthers the inequity in funding for classrooms across the state; it does not cure it as required by the Supreme Court.
The bill is the product of politics and not a consideration of the actual cost to educate Kansas school children. Clearly, the bill does not, by design or in its likely implementation, provide for “reasonably equal access to substantially similar educational opportunity through similar tax effort.” An attempted repackaging of the same resources previously found to violate the Kansas Constitution through a bill that perpetuates wealth-based disparities between the districts rather than curing them cannot reasonably be viewed as a constitutional response to the Supreme Court’s mandate. By passing the bill, this body once again fails in its constitutional duty under Article 6 to provide an equitable education to all Kansas school children.
In addition, if this bill is subsequently found to be unconstitutional by the Supreme Court, the majority party of this Legislature will have brought us dangerously closer to the Court’s June 30 deadline to comply with the Gannon decision. If the majority party is truly concerned about keeping schools open next fall, they should have appropriated $38 million in the fiscal year 2017 budget bill which passed the Legislature over a month ago. Appropriating $38 million would have been and remains a far more certain solution in meeting the equity test in Gannon than the uncertainty resulting from the passage of this bill.