How Nebraska funds public schools is under the microscope as the Legislature’s Education Committee begins a series of public hearings on the school funding formula.
The funding formula is called the Tax Equity and Educational Opportunities Support Act, known as TEEOSA.
The Education Committee held the first public hearing in Hastings, at the high school.
Hastings Public Schools Director of Finance Jeff Schneider told committee members he hears a lot of complaints about TEEOSA.
“There are three things about TEEOSA that I hear concerns with a lot: it’s too complex, there are too many non-equalized districts, and there’s too much burden on the property tax payer, specifically ag land owners,” Schneider testified. “As for being too complex, I don’t think there’s any way around it; 249 districts, 249 different situations. It’s going to take complexity to be successful.”
TEEOSA is the legislature’s attempt to provide equal funding to public schools throughout the state. It calculates a school district’s needs in light of its resources. The state funding formula provides more money for longer school years and for hiring more educated teachers.
The state also imposes mandated caps; first to keep school district spending from spiking from one year to the next and second to hold down the amount a school district can raise through property taxes.
The current property tax cap is $1.05 for each $100 in assessed valuation. The cap can be exceeded only with voter approval.
Superintendent of Adams Central Public Schools Shawn Scott urged the committee to keep the focus on education, not money.
“The equalization of education and education opportunities for students is what we’re all about,” Scott told the committee, “Now, we know that funding is (the) major force of how we do that, but the focus should be providing a quality education.”
Hastings Farmer Doug Saathoff expressed frustration that the formula relies too heavily on property taxes, which don’t go down even if farmers suffer through a poor year.
“My point again is that despite less income to pay property taxes, farmers are often asked to increase their contribution to fund local schools,” Saathoff said. “I hope the committee can find a better way to balance the burden of funding schools, especially rural school districts and distribute the burden more evenly. I don’t have the answers. I wish I did. But, I hope after some brainstorming, the committee can find better ways to provide aid to schools.”
Nebraska schools operate on about $4 billion annually. Nearly 45% of the funding comes from property taxes.
The Education Committee will consider alternatives to the current school funding formula. It also will work with the Tax Modernization Committee, which is making an overall review of the state tax system.
The committee has provided the broad concepts for which it is seeking input:
· Reduce reliance on property taxes through local option income and/or sales taxes
· Establish an education trust fund
· Distribute apportionment based on public school membership
· Base school spending limitations on economic measures
· Provide a minimum level of state funding for each district
· Use inflation adjusted statewide historical spending as a starting point for needs
· Base most of the need calculation on a single per student need figure
· Provide a need component that is equal for every district to represent fixed costs
· Provide additional need for unavoidable costs (special education, transportation,
· Use lottery funds for legislative priorities and district initiatives
· Continue providing state funds for student increases due to the option program
The committee met in Hastings and McCook Wednesday. It is meeting today in Dunning. On Monday, the committee will meet in the OPS Administration Building Board Room in Omaha, beginning at 10am. It meets in Macy the following day, Tuesday, October 8th. That meeting begins at 1:30pm in the Band Room at the Umonhon Nation Public School, 206 Main Street, Macy.
Tyson Havranek, KHAS, contributed to this story.