Florida Education Funding: Holding the Purse Strings

taxes-646512_1280Does Florida short change its students?  Where does the education funding come from and where does it go?  Answers to such questions require some ‘tax literacy’.  Florida is one of seven states with no income tax.  As a percentage of personal income, Florida has the fourth lowest tax rate in the country.  Corporate taxes currently are 2.9% of Florida’s revenue.  Yet, Florida is not a poor state; some areas are quite wealthy.
Now there is a legislative proposal to eliminate property taxes.  What are the implications of such an idea?  Clearly, sales taxes would have to go up.  The question prompted me to put together Florida’s funding stream for education.  I asked some questions:
  • How much of its budget does Florida allocate for education?
  • How does Florida’s education funding compare to other states?
  • How much of the education budget is funded from states sales tax, the lottery, local property taxes and the federal government?
  • How much is diverted from the education budget by corporate tax rebates for private school scholarships?
  • How much money is diverted from school districts to charter schools?
The answers to these questions explain a lot.  We can understand the power of the federal purse when we oppose federal mandates on testing and accountability programs.  We can understand public school districts’ concerns about the attempts to privatize the educational system.  We can evaluate the impact of proposals to reduce taxes.  Most of all, we can examine our state’s priorities.

FLORIDA’S BUDGET.  The 2014-15 Florida state budget of $48,135 billion is based primarily on a 6% sales tax.  Federal funds add $25,416 billion.  Medicaid expansion takes about one third of the budget, and education is about nineteen percent ($19.7 billion total was allocated for education in 2015).  Less than half of the education budget, comes from state sales taxes.
  • Forty seven percent of education funding was from local property taxes; 40.1% from state sales tax, lottery, and unclaimed property (State School Trust Fund) and 12.7% from federal sources.
  • Per pupil funding is not back to 2007 levels.  In 2007, it was $7,126 and in 2015, it was $7, 105 not adjusted for inflation.  There were 140,000 more students in 2015 than in 2007.
  • In 2013, Florida ranked 19th in the amount of income per person but 48th in per student state revenue for public schools.

LOTTERY ALLOCATION OF FUNDS.  The legislative intent  for the lotteryis to support improvement in education but is not to substitute for existing resources.   Twenty eight percent of the total lottery revenue ($1.5 billion) was transferred to Education Enhancement Trust Fund.  It is divided among higher education, Bright Futures and K12 education.  The percentage of the  (Lottery) Allocation  for education was: 50% to districts; 31% colleges and universities; 15.3% Bright Futures; 3.4% other financial aid.

Of all the $1.5 billion in funds transferred from the lottery, only about sixteen percent is actually allotted for K12 instruction.  K12 in 2014 was awarded $871,843,513; half of that amount goes to pay off bonds for facilities and work force education.  The remaining $420 million is designated for hiring teachers to meet class size requirements, school recognition programs, and a contribution to per student funding (FEFP).  Thus, of the $1.5 billion in lottery funds for education, about one fourth might reach the classroom by reducing class size and increasing per pupil funding.

  • $155,882,941  Debt service and bond programs
  • $152,836,215   Class size and facilities bond program
  • $ 82,412,304   Workforce education
  • $103,776,356   Class size reduction operations (11.9%)
  • $242,352,820  FEFP allocation (28%)
  • $134,582,877    School Recognition and district lottery (15%)

SCHOOL CHOICE.  Florida places a low priority on public school funding.  What money there is (or could be) is divided among public, charter and private schools. Evidence is lacking to show that school choice improves student achievement.   The cap for Florida Tax Credit scholarships for 2016 is $559,082,031.  These scholarships  are funded by corporate tax rebates donated to private schools.  Yes, they are 80 percent of the cost for public schools, but they result in under enrolled public and private schools that must operate inefficiently and too often ineffectively.

Charter school enrollment is over 251,000 students.  In theory, these students should also reduce the cost of public education, but the charter industry lobbies hard for increased facility funding for their privately owned buildings.  Thus, any savings would be eliminated, and the public would lose the buildings.  Add in the number of under enrolled public and charter schools, and any arguments for cost efficiency are lost.  Many in the charter industry, moreover, thrive by reducing teacher salaries and benefits, thus reducing teacher retention at a time the state is growing.  Again, the proliferation of charter schools does not improve student achievement, and lax oversight has resulted in the closure of over 300 schools due to fiscal mismanagement and poor test results.

FEDERAL FUNDING in 2014 was nearly two billion dollars ($1,806,215,753) for the Elementary and Secondary Education Act (ESEA) No Child Left Behind (Title 1, 6, and 10 programs for low income students and students with disabilities) and Race to the Top programs (teacher improvement and special education have the largest amounts).  Failure of states to implement No Child Left Behind/Race to the Top testing and accountability policies can result in withholding federal funds.

EVALUATING PRIORITIES.  How can we evaluate Florida’s funding priority for education?  If we compare the percentage the state budget allocated to education, Florida is the lowest among similar states i.e.  California:  54%, Texas: 27.4%, New York: 23%, and Florida:  19.7%.   Using a more sophisticated approach that accounts for funding distribution (support for districts relative to poverty) and effort  (funding relative to state GDP),  funding coverage (percent in public vs. private school), and level (per pupil funding), we can begin to see patterns in how states allocate education funding.

PER PUPIL FUNDING LEVEL Rank:      Florida 43,   California 42,  Texas 39,  New York 2

FAIRNESS Grade:                                   Florida B,    California A,     Texas F,   New York  F

STATE EFFORT Grade:                          Florida F,    California F,     Texas C,  New York  A

PUBLIC SCHOOL COVERAGE Rank:    Florida 43,  California 34,  Texas 20,  New York   45

The National Report Card reports these ratings as indicators of fairness.  They help explain the degree to which states provide equal educational opportunity for all students, and in particular for low income students in areas of concentrated poverty.  Interpreting such numbers must always be done with the understanding that no analysis can make total accurate representations within and across states.  The measures used, however, show clear patterns.  Florida, for example, ranks near the bottom on all measures except fairness.  Florida has a funding formula that accounts for differences in poverty across school districts.  New York spends a lot of money on education, more than most, but the money is not evenly distributed.












Posted in California, Charter Schools, Florida, Funding, New York, No Child Left Behind, Public Education, Tax credit scholarships, Texas.

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