The Saline Reporter
A Heritage Newspaper
Weekly Publication
Officials call for tweak of Proposal A
By Brian Cox, Staff Writer
PUBLISHED: February 8, 2007
For almost five years, in light of increasing concerns over unreliable financing from the state, school officials have called on legislators to revisit 1994's state Proposal A, which dictates how Michigan's schools are funded.
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When voters overwhelmingly approved the constitutional amendment in March 1994, it signaled a dramatic shift in how the state funds schools. Proposal A changed the main source of education revenues from local property taxes, which were decried as too high, to the state sales tax, which was increased to accommodate the new demand. Proposal A also shifted control of funding away from the local level and placed it squarely in the Legislature.
Proposal A worked well over the decade during a thriving economy when revenue from sales tax was high. But as early as 2003, education professionals saw warning signs that Proposal A, and thereby the state's schools, were vulnerable to a downturn in the economy.
In November 2003, professors David Arsen and David Plank of Michigan State University concluded, "After 10 years, there are increasing strains in Michigan's school finance system, which should be addressed at the state level."
The report went on to say: "The revenues earmarked for the School Aid Fund under Proposal A have never been adequate to satisfy the promises that the Legislature has made to Michigan's public schools. To make up the difference, the state has transferred an average of more than $500 million per year from the state's general fund to the SAF. The current structural deficit in the general fund will make it extremely difficult for the Legislature to continue transfers at this level."
It was a prophetic statement. The state enacted its first pro-ration, or taking back of promised revenues, to the tune of around $86 per student, the month following the report's release.
Since that first pro-ration, school districts have seen reductions or no increase in their per-pupil foundation allowance four out of the last six years.
At the same time, districts have seen their budgets buckle under increases in health care costs and state-mandated pension fund contributions.
"We have a structural problem that needs to be addressed by the Legislature," said Washtenaw Independent School District Superintendent William Miller.
Gov. Jennifer Granholm is expected to present her budget plan on Thursday, at which time school districts will learn the extent of the pro-ration, which could be as high as $224 per pupil, though many administrators believe it will be lower.
In the meantime, Proposal A continues on "un-tweaked."
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