For 2011-12, we know the added federal revenue has dried up, and after several years of using federal dollars to fund the state SEEK formula, Kentucky is struggling to resume full responsibility for SEEK and unable to replace the other federal resources. Estimating from Budget of the Commonwealth figures, the federal decline this year is likely to be more than $600 and the state increase closer to $60 per pupil after inflation.
Core point of this post: when we say that revenue per pupil grew slightly through last year, counting the temporary federal increases that are now gone, that means we know that the trend for this year and beyond will be decline unless state leaders step up in the current legislative session. We also know those funding losses will pose a grave danger to Kentucky's bold commitment to ensure that all students graduate from high school with the knowledge and skills they need to succeed in higher education and in the job markets of the future.
Here's a closer look at those trends for 2007-08 to 2010-11.
State funding per pupil, adjusted for inflation, declined an average of $726 from 2007-08 to 2010-11.
Local funding per pupil, adjusted for inflation, declined an average of $13 over the same years.
Federal funding per pupil, adjusted for inflation, grew an average of $615 over those years. That growth, of course, was not enough to replace the buying power of the shrinking local and state dollars.
Other revenue, adjusted for inflation, grew an average of $187 per pupil. Averages for other revenue need to be treated with care, because most districts receive very little from other sources, and a few receive quite a lot.
Combining those four categories, Kentucky schools received a total revenue increase of $63 per pupil after inflation from 2007-08 through 2010-11.
Again, looking to the current year and the future, we know our schools are now working with a federal decline and a state increase that is nowhere near enough to make up those losses. We also have reason to worry about local funding. The newest report on state revenue says that July to December state property tax collections in 2011 dropped more than 9% from the 2010 level. If local tax receipts show a similar trend, the results could be disastrous. It's too early to know that will happen, but definitely time to be very concerned that it might.
The core point here is important enough to repeat: when we say that revenue per pupil grew slightly through last year, counting the temporary federal increases that are now gone, that means we know that the trend for this year and beyond will be decline unless state leaders step up in the current legislative session. We also know those funding losses will pose a grave danger to Kentucky's bold commitment to ensure that all students graduate from high school with the knowledge and skills they need to succeed in higher education and in the job markets of the future.
Source notes: the main data for this analysis comes from Annual Financial Receipts and Expenditure reports per district, available here, with 2010-11 using the unaudited reports now available. Per pupil figures were calculated using December 1 preschool counts (from June 2010 and August 2011 Kentucky Board of Education briefing materials) plus K-12 average daily attendance plus growth (from SEEK files), and inflation adjustments were developed with this inflation calculator to reflect changes in what districts can buy with the money they receive.
I think these adjustments are wrong. If one wants to look at trends over time, the dollars should be, for example, on the 2007-2008 metric. That is, adjusted to earlier times.
ReplyDeleteI am not sure what is being compared here. It seems to be what would the funding have been if one knew what inflation would be.
Skip, It's a straight-up adjustment to 2011 dollars, done using a tool created by the agency that calculates the consumer price index.
ReplyDeleteI've certainly seen graphs that adjust all years to the earliest year displayed, but it is also common to use the most recent year available as I have done. For example, the Economist graph at http://www.economist.com/blogs/dailychart/2011/09/us-household-income used 2010 dollars for a chart published part way through 2011.
Adjusting to the most recent year is also helpful to current day decision-makers: it's the best way of understanding the buying power that has been lost and the adjustment that would be needed to restore it.
It is not clear to me how the Economist did that graph. The discussion suggests that it is earlier dollars rather that 2010 dollars, despite the label.
ReplyDeleteAny formula can be used differently. I think you should do the other calculation. You will get different results and then you can decide how you want to interpret your data.
Skip,
ReplyDeleteOn the Economist article, please do take a look at www.census.gov/hhes/www/income/data/historical/household/ and to table H-8, which is not inflation adjusted. It shows $49,995 as the US median income for 2010. That is the figure the Economist cites in the article and is consistent with graph. If you then review the figures for other years, I think you will become confident that the graph does indeed show adjustments to 2010 dollars.
My method for this work is a common approach, probably the dominant approach, to inflation adjustments in policy discussions of dollar figures. You can also find it in regular use in the New York Times and the Wall Street Journal. In addition to being a sound and respected method, it is also the method that produces numbers that are easiest to use for considering the implications of funding decisions for the immediate future.
If you'd like to do an alternate adjustment and publish it, I'll be happy to share the original numbers to assist your work.