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Final Education Budget – What you need to know

by Expect More Arizona

Education budget bills have passed through the Legislature and been signed by the Governor. This budget is by no means a complete, long-term solution, but it does put us on a strong path to raising teacher pay significantly over the next three years and fully restoring District and Charter Additional Assistance in five years, which are huge steps forward for education. Language in the budget indicates that it is the intent of the Governor and the Legislature that school districts increase the total percentage spent in the classroom and on student support and instructional support. Here is a summary of key budget details:

What’s in the budget?

  • Funding for teacher pay. The increases each year will be added to the base per pupil funding and therefore protected for the future and subject to annual inflation adjustments. The break down by school year is:
    • 2017/18 – 1%
    • 2018/19 – 9%
    • 2019/20 – 5%
    • 2020/21 – 5%
  • Full restoration of $352 million in district and charter additional assistance (DAA/CAA) over the next five years. Here’s the approximate breakdown:
    • $95 million – 2018
    • $159 million – 2019
    • $223 million – 2020
    • $288 million – 2021
    • $352 million – 2022
  • $8 million in one-time funding for state universities to fund resident students, $2.5 million in one-time funding for university “Freedom Schools”
  • $53 million for school building renewal and $88 million cash funding for five new school buildings
  • $3 million in state funding to leverage $7 million in federal funding for behavioral health specialists to enhance school safety
  • $1.8 million for Maricopa and Pima Joint Technical Education Districts to bring them to 100% funding

How much is the base per pupil funding increasing and will it be enough to cover a 9% teacher raise this year?

The increase in the base level funding for next school year includes a 1.8% increase for inflation (approximately $66.30 per pupil) and an additional increase of 5.7% ($210.50 per pupil) for increased teacher compensation. The state’s education funding formula is complicated, but when the $210.50 increase in the base level is multiplied by all of the components in the base funding formula it generates an additional $305 million for district and charter schools. State budget officials have determined that this will be enough funding to cover the 9% increase for next year.

What is the definition of “teacher” for purposes of allocating teacher pay raises?

The budget legislation does not define “teacher,” instead school district and charter governing boards will define who will receive raises. Each Local Education Agency (LEA) will likely have different definitions of who receives raises, which means that teachers may receive different raises. A May 9, 2018 webinar by ASBA, AASBO and ASA outlined three potential definitions of “teacher” that LEAs could use.

It is also important to note that the budget bills spell out a requirement for LEAs to report annually on their website the average salary of teachers employed for the previous and current year and the dollar and percent increase in the average teacher salary. In addition, the Arizona Department of Education will be required by November 30 of each year to do a report compiling average teacher pay for both districts and charters. (Note: Expect More Arizona will continue to report annually on where Arizona ranks nationally for median teacher pay adjusted for cost of living.)

Will classified and support staff receive raises?

Once again, language in the budget indicates that it is the intent of the Governor and the Legislature that school districts increase the total percentage spent in the classroom and on student support and instructional support. School districts and charter schools have the flexibility to use DAA/CAA funding for things such as increasing pay for classified and support staff, textbooks, curriculum, technology and school buses. Those decisions will be up to individual school districts and charter schools. More is needed, but this is a positive step forward.

How do I know that the Governor and future legislatures will follow through on these funding commitments?

This budget advance appropriates funding for both the teacher pay increases and district and charter additional assistance. This is not a 100 percent guarantee of future funding, but does make it substantially more difficult to undo.

Where did the additional money for education come from?

  • The bulk of the funding comes from projected increases in state revenue, however, the Governor did reduce those growth estimates slightly for the next three years. The Joint Legislative Budget Committee agrees with these estimates:
    • 4.3% growth in FY18
    • 4.4% growth in FY19
    • 4.5% growth in FY20
  • A portion of revenue from a new fee on every vehicle in Arizona (estimated to be $18-24/vehicle) and licensing taxes on alternative fuel vehicles will be moved to the state’s general fund
  • $18.4 million in general fund savings by removing the state subsidy to some districts related to property tax collections levied for desegregation funding
  • Numerous other one-time or multi-year fund transfers and state agency savings

How does this budget impact desegregation funding?

A 1980 voter-approved constitutional amendment caps primary property taxes at 1 percent of a home’s full cash value. The cost of desegregation programs was on the primary tax side, but this budget places the cost of desegregation programs into the secondary levy, the one for voter-approved measures — and the one that has no cap. State budget analysts have estimated how much property taxes will increase in eight districts affected by this decision. Homeowners in the following districts can expect to see their taxes rise by the following average amount per home.

School District Primary Tax Decrease Secondary Tax Increase Net Change
Tucson Unified $(101) $277 $176
Phoenix Elementary $(210) $226 $16
Roosevelt Elementary $(272) $300 $26
Cartwright Elementary $(126) $137 $11
Isaac Elementary $(90) $166 $76
Wilson Elementary $(88) $91 $3
Amphitheater Unified $(60) $60 $0
Maricopa Unified $0 $50 $50

 

What happens now?

We have a long way to go to meet the education funding needs of our state. Expect More Arizona is dedicated to our vision of ensuring every student – regardless of background, income, or zip code – receives an excellent education every step of the way. We promise to do our part to convene stakeholders from all sides to foster collaboration around shared solutions. Stay tuned for Vote 4 Education tools and resources!

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