Finding Revenue for Schools:

Case Studies

Lawrence O. Picus
USC Rossier School of Education
NCSL Education Finance Fellowship
March 2, 2019

Lawrence O. Picus
Outline
⚫ Who am I?
⚫ How can we find more revenue for
education?
⚫ Four Case Studies
• Arkansas
• North Dakota
• Wyoming
• Washington
2
My Background
⚫ Richard T. Cooper and
Mary Catherine Cooper
Chair in Public School
Administration
⚫ Professor of Education
Finance and Policy
⚫ Associate Dean for
Research and Faculty
Affairs
⚫ Co-developer of the
Evidence Based model of
school finance adequacy

Lawrence O. Picus
Finding Revenue for Education
⚫ First question is “how much do we
need?”
⚫ Reallocation of existing resources
⚫ Timing of increase in education
resources
⚫ More efficient taxation policies
⚫ Ways to find additional revenues for
schools
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How Much Do We Need?
⚫ School Finance Adequacy
⚫ Need to identify specific resources
and models
⚫ Need a better understanding of how
money links to student outcomes
⚫ Integrated Social Services

Lawrence O. Picus
Reallocation of Existing Resources
⚫ A way to improve schools without
raising taxes
⚫ Requires changing the way public
officials think about program costs
⚫ Schools are – in my view – the ideal
place to do this

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Timing
⚫ No need to reach new levels of
funding in one year
• Arkansas and Wyoming did
• Maryland took several years following
Thornton Commission recommendations
⚫ New resources should be focused on
most cost effective options

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More Efficient Tax Policy

RATE x BASE = YIELD

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Characteristics of a Fair Tax System
⚫ Broad tax base – low rates
⚫ Three leg stool (property, sales and
income taxes)
⚫ Each state is different

Lawrence O. Picus
Sources of Revenue

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How Do We Get Support
for Increased Revenues?
⚫ Focus on student needs
⚫ Ensure equitable access to revenue
sources

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Lawrence O. Picus
Case Studies
Arkansas
⚫ Court ruled inadequate funding of
schools
⚫ Adequacy study called for $847
million in new funding
⚫ Raised sales tax by 7/8 of a cent
⚫ Follow-up on use of resources and
recalibration of the model

Lawrence O. Picus
North Dakota
⚫ Agreement to stay litigation
⚫ Equity commission – Revenue
increase of over 10% ($90.5 million)
⚫ Adequacy study and dramatic
increase in state resources
⚫ Additional state revenues and
considerable property tax relief

Lawrence O. Picus
Wyoming
⚫ Court ruling
⚫ Three rounds of adequacy studies
⚫ Increased funding from $750 million
in 2000-01 to $1.6 billion in 2013-14
⚫ Regular recalibration of the funding
model

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Washington
⚫ Basic Education funding
⚫ Washington Learns
⚫ Years of studies and court
proceedings
⚫ Finally have something of an
agreement

Lawrence O. Picus