Hat Tip: Washington Post
Davenport Superintendent Art Tate has said in an open letter to the state of Iowa that he plans violate state law that prohibits districts from spending more than they are authorized emphasizing that the school district has the money in the bank and will not increase taxes to do so; however, lacks the authority granted by the state of Iowa under Iowa Code 257.7 which we provide below:
1. Budgets. School districts are subject to chapter 24. The
authorized expenditures of a school district during a base year shall
not exceed the lesser of the budget for that year certified under
section 24.17 plus any allowable amendments permitted in this
section, or the authorized budget, which is the sum of the combined
district cost for that year, the actual miscellaneous income received
for that year, and the actual unspent balance from the preceding
2. Budget amendments. If actual miscellaneous income for a
budget year exceeds the anticipated miscellaneous income in the
certified budget for that year, or if an unspent balance has not been
previously certified, a school district may amend its certified
Superintendent Tate’s letter is below:
While attending the Davenport legislative forum on Saturday, I was deeply impressed by two things: First, students from our district were wearing t-shirts proclaiming “I’m Worth-Less,” and it made me realize my personal responsibility as their leader to take action to assure that their district provides them with budget support equal to other students throughout the state. Second, as I listened to members of the audience question why the legislature can ignore the law by not producing a timely two-year education budget, it caused me to consider why I should be held to a higher standard when it comes to statutes concerning budgets.
Iowa State Code 257.7 prohibits districts from spending more than they are authorized, based on the district’s’ certified budget and the increase in allowable growth/state supplemental aid provided by the state. In other words, the state restricts how much a district can spend, no matter how much you have in the bank. The state requires that districts maintain something called the Unspent Balance which comes from monies the state allowed you to spend, but instead were saved as a reserve. Here’s the important point: State law does not allow the unspent balance to go into the red, which means that you are spending more than the state authorized. That is against the law.
I am formally informing the Board and the public of my intention to violate the state law. With my plan that begins next school year, I put into play operations which will bring us into spending more than authorized by the state during school year 2016 – 2017, and that violates State Code 257.7. I am taking this action after careful consideration and understanding the possible personal consequence. I take full and sole responsibility for the violation of state law. With this action I am following the example of our state legislature, which has ignored the law this year by not providing districts with the state supplemental aid amount by February 12, 2015. Let me emphasize that we have reserve cash to fund this effort; what we lack is state authorization.
The state funding formula is complicated and hard to master. But these facts are not complicated:
- Our students and families have unmet needs resulting from a lack of funding.
- We have cash reserves on hand of $29 million.
- By using our reserves, we can sustain additional funding or programs without increasing the tax levy.
- The state formula undervalues our students by $3.2 million each year
The Davenport Community School District is comprised of nearly 16,000 students with a 67.3% free and reduced lunch population. The district’s Board of Education and I have been transparent in describing the critical challenges which face our schools and students. Our most notable challenges are achievement rates which do not meet our standards; a wide achievement gap between many subgroups, which is absolutely unacceptable; a dropout rate which, although significantly improved, still reflects that too many students are leaving our schools each year before graduation; and a suspension rate which, although it reflects national trends, is problematic. By its board priorities, the Directors acknowledge the overriding effects of poverty on education in the district.
For over four years this district has been involved in significant reform efforts to address our challenges. Our Board of Education, administrators, teachers, and staff are focused on implementing programs which provide amazing supports for our students and families. With over 18 years’ experience as a superintendent in four states and five school districts, I can say without reservation that I have never seen an organization more committed to success than Davenport. As I visit the schools, I personally witness the sacrifices made on behalf of students. Our schools are making herculean efforts which reach far beyond the mission of education. This is a caring district.
All that being said, the fact is that we do not have adequate resources to provide appropriate response measures to meet our challenges. Instead of adding needed supports and interventions, we have been reducing our budget for over a decade.
Davenport Community School District is one of 165 districts in the state of Iowa which receives less money per student than a group of 173 higher-compensated districts. The “I’m Worth-Less” t-shirt is literally correct. Our students are valued less than many others in the state. This unfair situation has evolved from the early 1970’s when the state funding formula was enacted, and carries forward to the present day where the value placed on our students is $175 less than the value for other students in districts which receive the highest per student rate in the state. In other words, the state funding formula is explicit in valuing a Davenport student less than students in over 170 other districts, including, for example, Pleasant Valley and Bettendorf. How can this be right in any universe?
If Davenport students had the same per pupil value as the highest compensated districts in the state of Iowa, this year and next we would receive an additional $3.2 million to spend on our students. I need to repeat that: Because Davenport students have less per pupil value in the state funding formula, we receive $3.2 million less than equity would dictate. How is this fair? How is this equitable? How can we accept that our students have less funding value than students in PV or Bettendorf?
It is hard for me to even conceive how a state government could have allowed this discriminatory practice to exist for so long. In the last five years, Davenport School District would have received an additional $17,352,998 had we been getting the highest per pupil compensation. Instead, in the last five years, the district has had to reduce its budget by a total of $17,272,791, almost the exact amount that we were denied by a system which discriminates against almost half the districts in the state.
Next year I will retain several logical reductions in the budget: 1) early retirement, 2) utility savings through an energy conservation program, 3) moving maintenance contracts from general fund to management fund, and 4) curtailment of professional development during the school day. The total of these cuts will be $1,405,000. I will be making no other reductions to programs and personnel, and most notably, I will not be increasing class size in order to reduce teacher positions. There will be the normal minor changes in teacher positions due to using our staffing guide, and I will continue to look for savings in department budgets and through possible consolidation of leadership positions. But I cannot with a clear conscience make reductions which will damage student achievement when the undervaluing of our students is institutionalized by the funding formula of the state. I want to prove to the students, parents, and employees of this district that they have equal value to any school district in the state.
In addition to taking fewer budget reductions than I had originally proposed, I intend to use up to $1 million to support new programs designed to reduce our achievement gap, to fight the effects of poverty, and to address diversion programs needed to turn around our out-of-school suspension numbers. We must enact these new systems of supports to turn around situations and inequities that are unacceptable. We cannot continue business as usual.
By not reducing the budget as previously planned, and by adding new essential programs, the plan to increase the unspent balance to $8 million over time will be negatively impacted. This places me on a glide path to violate the state law during the 2016 – 2017 school year when we spend more than authorized, but not more than we have in cash reserves. But I have a plan to build up the reserve fund and to be fiscally responsible. My plan is simple: To be relentless in pressuring the state to change the law so that Davenport students will receive the same per pupil dollars as the highest compensated districts in the state, and to push for immediate passage of a law which will let us spend cash reserves to increase our per pupil expenditures. When the district and our students have equal value in the state, we will be back on track for constituting an unspent balance and not overspending the authorized budget.
We can’t continue to reduce programs and expect that all our great ideas and intentions will turn the tide. As the leader of this district, I cannot turn a blind eye to our needs, knowing that there are practices and programs which can make a measurable difference in our results. We all know the impact that poverty makes on our community and upon education. I cannot sit idly by and pretend that we can make $3.5 million in reductions to our budget next year, and that things will be OK; things will not be OK. We have to be bold, we have to employ proven techniques, and we have to do whatever it takes to meet the needs of our students and community. I feel a personal obligation to provide this community with the best education system possible. We cannot do that without reasonable resources. We cannot accomplish our mission until our students are valued equally with all other students in this state.
It is important to point out that we have $29 million in cash reserves in the bank, and no additional levies are needed to accomplish my plan. We have the cash to pay for every program and position without increasing taxes. We just do not have state authorization to spend more because the formula undervalues our students. Everyone must understand that if our students were valued the same as the highest per pupil students in the state, if there were equality of funding, if all districts were treated the same, we would have $3.2 million more to spend, and I would not have to break the law in order to support my district.
In short, I care more about our students and their needs than I do about the state law in this case.
Dr. Arthur W. Tate, Superintendent