SEEK has become less adequate, less equitable

The SEEK formula (explained in yesterday's post) is designed to be Kentucky's main approach to providing both adequate funding and equitable funding, but its most important features have been losing strength over time. Here are four major concerns: 

1. THE BASE GUARANTEE HAS NOT KEPT UP WITH THE COST OF LIVING
From 2012 to 2017, the guarantee rose by $100 per pupil, from $3,881 to $3,981. To keep up with inflation, the guarantee would have needed to increase by another $171, to $4,152. 

2. THE BASE GUARANTEE RELIES MORE AND MORE ON LOCAL CONTRIBUTIONS
The 2012 to 1017 $100 increase was paid for by a $147 per pupil increase in local funding and a $47 decrease in state funding per pupil. The local share went up because property assessments grew by an average of $49,000 per pupil, and the local share is based on the 30¢ per $100 of taxable property. 

3. TRANSPORTATION ADD-ON FUNDING IS FAR BELOW THE STATE’S OWN ESTIMATE OF TRANSPORTATION COSTS
By law, the SEEK formula should fund full transportation costs calculated using a statewide formula. For 2017, the formula called for transportation funding of nearly $353 million, but the state budget provided only $214.8 million. That failure to fully fund the formula meant that districts have received an average of $230 less per pupil than legally required. 

4. LOCAL TIER 2 REVENUE IS AN INCREASING (AND INCREASINGLY UNEQUAL) PART OF TOTAL SEEK FUNDING
Revenue above the Tier 1 maximum counts as Tier 2 revenue, and it does not receive any state equalization. The absence of equalization matters quite a bit. As noted earlier, a 20¢ unequalized tax rate will produce:

• $600 added revenue for a district with $300,000 in property per pupil
• $1,000 added revenue in a district with $500,000 in property per pupil
• $1,400 added revenue in a district with $700,000 in property per pupil

In Tier 2, districts with lower wealth brings in less revenue to use in serving their students, even when they set tax rates just like those in districts with more taxable property.

In 2017, 171 of Kentucky’s 173 school districts set rates above their Tier 1 maximum. 148 districts went further above the Tier 1 maximum than they had gone in 2012, meaning they made a greater effort to obtain Tier 2 dollars. On average, districts increased their rates by 5.8¢, and that increase generated an average of $306 in local funding per student—but the lack of equalization meant that students in some districts received far more and others far less than that average amount.

These erosions of Kentucky's SEEK investments are making it harder to implement and sustain the bold strategies our students and our state need.