We've moved!

Social Icons

twitterfacebooklinkedinrss feed

Thursday, January 7, 2010

HB 1050: Rounds Requests Zero Budget Increase for K-12 Education

Hot off the press: House Bill 1050 proposes two tiny changes to SDCL 13-13-10.1, the definitions for the state education funding formula:

(4) "Per student allocation," for school fiscal year 2009 2011 is $4,664.66 $4,804.60. Each school fiscal year thereafter, the per student allocation is the previous fiscal year's per student allocation increased by the index factor;

Only five digits change. But those five digits are how Governor Rounds intends to get around the state law that requires an increase in state aid to K-12 education of 3% or (roughly*) the inflation rate, whichever is less. Governor Rounds isn't asking to change that index factor; he's asking to change the baseline.

$4,804.60 is exactly the per student allocation for the current fiscal year. HB 1050 sets the same allocation for next year.

I hear Republicans (who have already forgotten the Reagan and Bush deficits) say deficit spending is bad. We're not supposed to borrow money from our kids to balance our budget.

Deficit spending supposedly takes money from our kids when they are old enough to work and pay taxes. Governor Rounds wants to take money away from our kids now, while they are still kids, in school.

Does anyone else see the disconnect here?

-------------Footnote for econ nerds only!-----------------

*SDCL 13-13-10.1 defines the index factor as "the annual percentage change in the consumer price index for urban wage earners and clerical workers as computed by the Bureau of Labor Statistics of the United States Department of Labor for the year before the year immediately preceding the year of adjustment or three percent, whichever is less". Urban wage earners and clerical workers—does anyone know why a rural state like South Dakota chooses urban wages as the benchmark for education funding increases?

Interesting: the Bureau of Labor Statistics says the CPI-W (that's the one we're using) represents 32% of the U.S. population. The CPI-U represents 87% of the population. Furthermore:

There can be small differences in movement of the two indexes over short periods of time because differences in the spending habits of the two population groups result in slightly different weighting. The long-term movements in the indexes are similar. CPI-U and CPI-W indexes are calculated using measurement of price changes for goods and services with the same specifications and from the same retail outlets. The CPI-W is used for escalation primarily in blue-collar cost-of-living adjustments (COLA's). Because the CPI-U population coverage is more comprehensive, it is used in most other escalation agreements [emphasis mine; Bureau of Labor Statistics, "How to Use the Consumer Price Index for Escalation," 2001.10.16].

So, the CPI-W is less comprehensive, is used mostly for blue-collar employment agreements... and we use it to determine funding for K-12 education. I'm sure there was some logic to this choice; can anyone explain it?


  1. OT: Good State of the State by Governor Paterson. Best comment: 'no longer are we going to run the state like a payday loan operation.'

    John Kelley

  2. Steve Sibson1/08/2010 6:21 AM

    "Governor Rounds wants to take money away from our kids now, while they are still kids, in school."

    That is a lie. The money is not given to kids. And not allowing an increase cannot be called taken anything away from anybody.

    Another phony statement.

  3. In his first seven years, Governor Rounds has done everything in his power to reduce funding to K-12 Education at a time when schools were suffering from declining enrollment under a formula that only works when student numbers are increasing, and even then, the formula is lacking for districts with exponential growth.

    When you build a home, the foundation is the most important piece. Your foundation has to be solid or the structure will fall or deteriorate quickly. Our children are the foundation of our state's future existence. When Governor Rounds balances the state's budget on the backs of our most vulnerable citizens, he continues Bill Janklow's ill-informed education policies.

    While K-12 is asked to take the budget beating, higher education continues to build new facilities, hire new staff, add new programs and advertise to the same declining enrollment high school grads whose numbers are down 30 to 50%. State government has seen the highest job growth under Governor Rounds.

    Cut the budget, lay off some state employees, but don't balance the budget on our children's backs by harming their education opportunities and forcing school districts to share an unfair local tax burden.

  4. Steve, I know you're desperate to get a rise out of me by branding everything I say a "lie." It's not working.

    But I will take a moment to explain the simple language behind my statement. The law currently guarantees that, in FY2011, the state will allocate $4804.60 + the index factor, probably something around $144. Governor Rounds is proposing to take away that promised $144 from every student. In other words, as Rod points out, Governor Rounds is balancing the budget on the backs of our most vulnerable citizens... or at least those citizens least likely to vote.

  5. Steve Sibson1/08/2010 9:28 AM


    I have been tracking the state budget and actual spending for a few years now, and education has been getting huge increases while enrollments dropped (as Rod points out). If you have less students to tach you should be spending less. You continue to ignore the facts and truth that I bring forward, but ignorance will not change the truth.


Comments are closed, as this portion of the Madville Times is in archive mode. You can join the discussion of current issues at MadvilleTimes.com.

Note: Only a member of this blog may post a comment.