Fair Funding For County Schools
Imagine if Anne Arundel County schools got an extra $28 million this year. What could they do with that money? Imagine what they can do if they receive it every year into the future.
Imagine the School Superintendent not playing politics with the County Executive and Council. Imagine the State legislature not passing laws to bust the property tax cap because of alleged underfunding of County schools by County taxpayers.
According to the Anne Arundel County Spending Affordability Committee, our taxpayers are paying $28 million per year to subsidize public schools in Howard and Montgomery Counties because of flaws in the State’s funding formula for public education.
Their careful and thoughtful analysis was contained in their annual report that they briefed to the County Council and provided to the Anne Arundel County Delegation in the state legislature, yet they’ve done nothing.
In 2002, the Thornton Commission recommended that the State increase support for public education. Thornton recommended four guiding principles to the General Assemble: Adequacy; Simplicity; Flexibility, and Equity.
Adequacy means that every student is entitled to the same level of funding. Simplicity dictates that the majority of state aid is funneled through four formulas; a Foundation Program and one for each of three special needs populations.
Flexibility means that aid should be distributed in the form of block grants to jurisdictions. Equity means that taxpayers and property owners are treated alike throughout the state, and that funding should be wealth equalized so poorer jurisdictions get a larger share than wealthier jurisdictions.
According to the Spending Affordability Committee report, “The General Assembly faithfully implemented adequacy, simplicity and flexibility. It did not apply equity in the funding formula.”
For example, according to the Spending Affordability Committee’s Fiscal Year 2013 report, Howard County received 7 percent more than Anne Arundel County in per Pupil State funding when the Thornton School Funding formula began in 2003. That gap widened to 21 percent in FY 2011, and continues to this day, even though the reported average net taxable income per taxpayer in Howard County was 25 percent higher than the reported net taxable income per taxpayer in Anne Arundel County.
Howard County Public Schools received $500 more per pupil from the State than Anne Arundel County Public Schools because there are nearly 10 percent more taxpayers per pupil in Howard County. The formula adopted by the General Assembly equalizes funding on the basis of average wealth per pupil rather than average wealth per taxpayer. This has the perverse effect of having taxpayers in Anne Arundel, Prince Georges, and Baltimore Counties subsidizing wealthier taxpayers in Montgomery and Howard counties.
Some may claim that changing the formula to use wealth per taxpayer as the metric for equalizing state funding for schools will short-change students. But that is not correct. The state formula apportions revenues received from all taxpayers in the State in order to standardize the amount of funding a school district receives to educate all of its Pupils regardless of differences in taxpayer wealth between districts.
Adequacy means that every student in the State is entitled to the same level of funding. Equity means that taxpayers and property owners are treated alike throughout the State.
The formula needs to be changed so that taxpayers in the wealthiest counties pay the same proportion of net taxable income to support education as taxpayers with similar net taxable incomes in the poorer counties. Property owners in the wealthier counties should pay the same rate per $100 of assessed value to support education as owners of similarly valued properties in the poorer Counties.
Partisans may claim that the formula flaws are being ignored in order to force Anne Arundel County to bust its property tax cap. That is too cynical, even for a system that is renowned for its cynicism.
The more likely explanation is that few people understand the formula and even fewer complain about it. So why rock the boat?
The reason to rock the boat is because under state law, taxpayers in wealthier counties, like Anne Arundel, are required to subsidize taxpayers in less wealthy jurisdictions. But we should not be required to subsidize taxpayers in richer ones too. Imagine what Anne Arundel County Schools could do with $28 million per year.