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Nov 20

In Ohio, a bevy of levies

Published Thursday, November 20, 2008 8:15 AM by Andy Benson

At the annual conference and trade show put on by the Ohio School Boards Association in Columbus last week, everyone seemed to be talking about school levies.

Some of the urban schools were cheered by passage of their levies, no doubt fueled by the heavy turnout for the presidential race. Other schools were lamenting levy failures, which meant back home they had to face budget cuts, delayed spending on needed maintenance or materials, and difficult decisions on when to go back on the ballot. More on election results.

Not if they go back on the ballot, but when.

As you no doubt know, Ohio has the distinction of having more levies than any other state. That's because Ohio school districts are prevented by state law (House Bill 920) from collecting the additional revenue that could come from higher valuations of property every year. More on HB 920. This barrier makes it difficult for school districts to just keep up with inflation without going back to the ballot again with more levies.

Ironically, the property value growth in school districts could be partially credited to the performance and reputation of the schools, as many communities tout their schools as a reason to buy property there.

No other governmental entity in Ohio faces this problem, and very few if any states have this problem. The state had 237 school levies on the ballot just this month.

The state law, House Bill 920, was passed in 1976 during a feverish debate about how to protect property owners from higher taxes that were resulting from rapid growth in property values. That inflationary time has not been repeated since, but the state law, later imbedded in the Ohio Constitution, is still in place and creating havoc for schools.

Consider that Ohio school districts have placed nearly 10,000 school levies on the ballot since the law was passed in 1976. That's about 16 levies for every school district over the past 32 years, or a levy on the ballot every other year during that time. Consider the time, resources and energy for school districts in keeping up with that pace, and the fatigue and confusion for voters who must think that the schools are insatiable in their appetite for tax revenue.

For some, the revenue is just to keep even. Batavia, for instance, got to be on the local news in Cincinnati this week, not for its academic progress or sports team victory or band concert, but because its 9.8 mill bond levy failed in August. More on Batavia. That leaves it without enough money to improve the poor condition of its buildings.

We'll talk more about the growing conversation that one way to fix Ohio school funding is to allow school districts to keep more of their local revenue so they can deliver the results that are expected of them.

Comments

Paul Lambert said:

I believe there are at least a couple of things going on here that merit additional conversation:

First is that the valuation of real estate - and I'm talking real valuation, as in what a buyer is willing to pay for a piece of property - does not change with inflation. The proof is obvious: in the last decade, home prices have shot up explosively while inflation has remained low.

We may well be on the verge of seeing the opposite take place: home prices decline while inflation skyrockets.

The second fallacy in your line of thinking is coupling the rapid rise of school <strong>costs</strong> compared to inflation. They're not. Nearly 90% of the operating cost for any school district is the salaries and benefits of its employees. Thanks to strong teacher's unions and weak school boards, it's not unusual for a school district to be paying annual increases of 7% or more to the majority of its employees. This rate of increase is, and has been, well above whatever measures of inflation one might choose to apply.

On top of that, public school teachers enjoy excellent health coverage at minimal contribution, and are members of one of the largest defined-benefit retirement systems in the country at a time when few private industry workers have any pension at all.

It's interesting that you bring up criticism of HB920 right now, because it turns out that HB920 has a protective nature in times of decreasing home values, in that it prevents tax revenue from declining when home values go down, as is currently the case. If it were not for HB920, many districts would be facing situations of declining revenue in additional to rising costs.

Here's the real truth: the reason many school districts have such a tough time passing levies is that they are horrible communicators. Most citizens have little understanding of how school funding works in Ohio. One would think that one's school district, which employs hundreds if not thousands of folks who are college-trained in the art of decomposing knowledge into lesson plans to be delivered to children, should be able to effectively explain school funding to the people of their communities.

But I can't say I know of any school district that undertakes this mission effectively. One would think that a school district - the very institution which most draws people to move to a community - would have the advantage of an electorate heavily biased toward supporting the schools. Instead, most school districts win and lose by tiny margins. That tells you how bad they are at building relationship with their customers - the citizens of the district.

And they're that bad because they operate from the same perspective as your writing: that schools deserve whatever money they say they need and anyone who disagrees must be stupid.

For the past couple of years, I have made it my mission to educate the members of our community about the true dynamics behind the school funding dialog. Please help me lift the fog - not add to it.

November 20, 2008 3:21 PM
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Benson

About the Author

Andy Benson has served as an expert commentator and consultant on school funding cases in Ohio. He is currently director of policy for KnowledgeWorks Foundation, where he leads the education philanthropy's efforts to increase learning opportunities in the state and improve the education system. The foundation spearheads the School Funding Matters initiative and has provided support for improvements in high schools, increased adult workforce training opportunities, creation of P-16 collaboratives, and the encouragement of community engagement in the state.

A decade ago, he was founding president of the New Ohio Institute, a statewide public policy think tank that conducted in-depth studies on education, statewide polls and publications that served as a resource to advocates and policymakers across the state. He holds master's degrees from Harvard University and Ohio State University and a bachelor's degree from Ohio University.

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