Schooling State Government About Education Funding

Persistence is always a mandatory attitude when dealing with government, and that’s even the case when it’s a county commissioner dealing with state government officials.

It’s taken Shelby County Commissioner Mike Ritz more than a year to get the approximate data that he requested from state government, but his relentlessness has finally produced results. As a result, county government is poised to file a lawsuit against State of Tennessee for failing to fully and accurately fund local school districts.

Ironically, his basis for the lawsuit is the equal protection clause of the Tennessee Constitution, the same legal argument made by the rural schools when they capsized the state’s entire funding system about 16 years ago.

Coming Up Short

In those days, the rural schools argued that they were shortchanged in school funding. Today, Commissioner Ritz argues convincingly that Memphis and Shelby County’s students are underfunded by $30 million a year.

He makes his case in perhaps the most complex resolution ever presented to the board of commissioners, containing a blizzard of numbers and calculations that shows, in the words of Mr. Ritz, that “our taxpayers, when our ability to pay is considered, are sacrificing for our kids.”

“Ability to pay” is a telling phrase in the world of Tennessee school funding, because ever since the BEP (Better Education Program) was passed in the early 1990s, each county’s fiscal capacity has been determined to set the amount of state funding and the amount of local funding required by the state.

Causing Ripples

For years, the school funding formula has been as decipherable as Chinese, and as a result, local government and school officials have taken state officials at their word when they said that our community was getting its fair share.

After spending a year just trying to get data, which he then had to manipulate to get the final answer, Commissioner Ritz received another strong message from Nashville: there won’t be a political solution to this problem. Clearly, however, he’s thrown a rock in the school funding pond and the ripples are attracting attention in the Capitol.

Undoubtedly, the ripples will be getting larger following the approval of the board of commissioners of a Ritz-sponsored resolution calling for Shelby County Attorney Brian Kuhn to “explore, study, and report” on the potential of hiring “outside counsel” to file suit against state government.

Check’s In The Mail

That said, there’s no need to look for a check from state government anytime soon. The lawsuits filed by the rural school alliance took just over a decade to be resolved. The new BEP 2.0 funding law set out a formula that was supposed to address some funding needs, and it did result in several millions of new funds for local schools.

However, even with that additional funding, Memphis and Shelby County schools are falling short of adequate funding. We’ve written before about the additional taxes that Memphis and Shelby County taxpayers pay for education as a result of the bulge in school-age children in our community. When compared to the other 50 largest metros, this bulge is about 20% more than other regions.

The tax implication of that bulge is about $200 million a year in school funding alone, but based on Commissioner Ritz’s research, it’s exacerbated by the $30 million in state funding that never finds its way to our community.

Calculated Opinion

To reach his conclusions, Mr. Ritz calculated school funding for two fiscal years, 2005 and 2006, and found that in both years, state funding for local schools was less than the state average despite our large percentage of at-risk students and special needs students. For example, state funding of all public schools in Tennessee in 2006 amounted to $3,318 per Average Daily Membership (ADM) while local school systems received $3,118 per ADM.

State funding is based on a calculation that includes a county’s property taxes and its sales taxes, and while some state reports suggest that Shelby County has one of the state’s highest fiscal capacities, Commissioner Ritz’s report points out that it’s just not true.

Total property assessment per ADM student in Tennessee is $124,375. For Memphis and Shelby County, it is $107,433. That compares to $221,382 in Nashville/Davidson County.

The Obvious

The sales tax statistics tell a similar story. The sales taxes for Tennessee per ADM were $8,868, but for our community, it is $6,992. For Nashville, that amount is $15,940.

As a result of these comparisons, Commissioner Ritz’s resolution said that it is obvious that Shelby County’s taxpayer wealth (property tax) is less when compared to Tennessee and its taxpayer disposable income (sales tax) is lower when compared to all of Tennessee.

According to the county resolution, some suggested claims for the outside counsel to consider are requiring state funding to never be less than local funding for schools or less than the average state ADM, requiring repayment of the cumulative underpayment amounts, considering damages for the state’s past unfair funding, requiring payments to Shelby County that could be used to pay down its bonded indebtedness, and requiring the state to fairly calculate payments in the future.

Keeping Attention

All in all, this funding issue – while attracting significantly less interest than City Council school funding cuts – deserves greater understanding by the public and firm support from both school systems.

After all, if Commissioner Ritz is right, the school districts would get more funding, because state law doesn’t allow county government to reduce its level of funding no matter how much it might get from Tennessee.

Anyone who knows him can say one thing for sure: there’s no chance that Commissioner Ritz’s persistence will flag.