Adventures in wonkishness

I guess you can tell that I am one of those policy wonks that finds joy in the obscure corners of municipal funding formulas. As a policy wonk and a teacher, there isn’t much that is more fun than having the opportunity to explain some of this obscurity in the context of some wonderful news.

I find great joy in being able to vote to eliminate the kindergarten fees. As a newly-appointed (May) replacement player, I am coming in at the end of the process and I am really thrilled to be able to cast the vote later tonight. It is a vote that I wanted to cast for my previous six years on the committee, and I celebrate my good fortune to have the opportunity to do so now!

There was lots of hard work before this point, including a committee that went around looking at how kindergarten was being financed all across the state. Tonight (and on cable replays) you will have the opportunity to hear the story of how this all happened. As these stories are told, I will add links so the folks who did the hard work to bring this to the committee can be celebrated for the tremendous contribution they brought to our community. I didn’t do any of this work, but after six years of voting budgets with this awful fee, I am thrilled to just have the job of casting a vote at the end of the process.

Your Arlington: Kindergarten mom digs out lead that helped end fee

Kindergarten committee members were parents Dolores McGee, Brendan O’Day, Farhana Riaz and Ruthellyn Jacob; Deborah D’Amico and Julie Dunn, administration; and William Hayner.

Ending the Kindergarten user fee!

When I returned to the school committee, I came back with a few items of unfinished business. There were a few things I wanted to achieve that were not possible during my earlier two terms (2001-2007). The biggest unfinished item will be crossed off the list tomorrow night. We are about to eliminate kindergarten fees. We are about to refund the fees paid for the 2012-13 school year. The state is going to pay us to get rid of the kindergarten fees.

Why can we do this? To understand why this works, you need to understand how the state funds local school districts and the Chapter 70 formula.

The state’s Chapter 70 program is based on a few simple components:

  1. A foundation budget, based on the cost of educating the children educated in the district, is calculated. The foundation budget is based on what is known as the October 1 count, which is the student enrollment reported on October 1 of the previous school year. (For example, the funding for the 2012-13 school year is based on the enrollment on October 1, 2011.)
  2. The state determines how much a city or town can afford to contribute to the foundation budget, and requires the municipality to contribute that amount. This is the required local contribution.
  3. The difference between the foundation budget and the required local contribution is funded through the Chapter 70 local aid account.

For Fiscal 2013 (the 2012-13 school year) Arlington’s numbers are:

Foundation Budget: $45,702,617.25
Required Local Contribution: $ 37,180,313.00
Chapter 70 Aid: $8,522,304.25

The Required Local Contribution is a function of the previous year’s Required Local Contribution. It is determined by multiplying last year’s Required Local Contribution and increasing it by the Municipal Revenue Growth Factor (the amount of growth in local municipal revenues).

(Fiscal 2012 Required Local Contribution) $35,933,423
* (Increase by Arlington’s Municipal Revenue Growth Factor of 3.47%)  1.0347
= (Fiscal 2013 Required Local Contribution) $37,180,313.00

No matter what happens to the foundation budget, the Required Local Contribution remains the same. It is a function of the previous year’s Required Local Contribution and the Municipal Revenue Growth Factor, and nothing else. (This is the key to the equation.)

If something happens to increase the foundation budget, and the Required Local Contribution doesn’t increase, the state must fill the gap with Chapter 70 state aid.

What could happen that would cause an increase in the foundation budget?

Generally, the foundation budget goes up when enrollment goes up. If the number of English Language Learners goes up, the foundation budget goes up even more. If the number of free or reduced lunch students goes up, the foundation goes up even more.

For the current school year (FY13 – based on last year’s October 1 count), here’s how much a student contributes to the foundation budget.

Half-day kindergarten: $3,576.91
Full-day kindergarten: $7,153.90
Elementary: $7,197.06
Jr. High/Middle: $6,822.68
High School: $8,508.67
ELL Half-day kindergarten: $4,573.40
ELL Full-day Kindergarten, grades 1-12: $9,146.78

On October 1, 2011, Arlington had 344 half-day kindergarten students and 30 ELL half-day kindergarten students. Almost all of these students attended full-day kindergarten, but the second half of the school day was funded by a user fee that tops out at $3,000.

Here’s how these students contribute to our foundation budget:

(Not ELL) Half-day kindergarten: $3,576.91 * 344 = $1,230,455.94
ELL half-day kindergarten: $4,573 * 30 = $137,202.04
Total half-day kindergarten:  $1,367,657.98

We currently budget $970,000 in user fees to support these students.

What happens if we decide we aren’t going to charge a user fee for full-day kindergarten? Half-day kindergarten students who pay fees become free full-day kindergarten students who cannot legally pay fees. The district loses $970,000 in fees. However, it changes the foundation budget as follows:

(Not ELL) Full-day kindergarten: $7,153.90 * 344 = $2,460,968.71
ELL Full-day kindergarten: $9,146.78 * 30 = $274,403.46
Total full-day kindergarten: $2,735,372.16

Moving all our half-day kindergarten students into free full-day kindergarten seats increases the foundation budget by $1,367,685.77. The required local contribution (what Arlington pays) does not change. Because the required local contribution increases by the municipal revenue growth factor, and not the foundation enrollment, every dollar increase in the foundation budget that comes from converting to a free full-day kindergarten must be funded by the state through the Chapter 70 formula. Next year.

Bottom line. If we eliminate $970,000 in user fees this year (2012-13) we receive approximately $1.4 million in additional Chapter 70 aid next year, and that number will be incorporated into our Chapter 70 aid every year thereafter.

Tonight (September 12), the Finance Committee voted to endorse a plan to take $970,000 out of reserves and appropriate it to the school committee. The Finance Committee plans to adjust our fiscal stability plan to allocate an additional $970,000 to the schools in subsequent years (to cover the elimination of the user fees), and the remainder of the Chapter 70 increase will be returned to reserves. This will pay the town back for advancing the $970,000 in this year’s budget.

When I was on the school committee in 2001, we inherited a fee-based full-day kindergarten. The fee started at $1500, and we were able to reduce it to $500. We were poised to eliminate it in 2003, but that was the year that Mitt Romney became governor and reduced our Chapter 70 aid by 20%. That year, we were forced to make significant cuts and raise fees.

Eliminating the kindergarten fee is a dream deferred, but it’s a dream we will realize on September 13, 2012.

It’s a win-win all the way around, and the most joyous vote I will take as a school committee member.