Faulty Funding Support for school districts still skewed by odd formulas

Monterey public school | Photo by Joe Livernois

| EDUCATION

By Susan Landry

The Carmel Unified School District is spending twice as much per student as its neighboring disrict on the Monterey Peninsula, but officials from both districts say they’re underfunded. And some believe a proposed initiative that may soon end up on California’s ballot could bring some balance in per-student spending across district lines.

PK Diffenbaugh, superintendent of the Monterey Peninsula Unified School District, said he thinks Schools and Communities First, an initiative which would close commercial property tax loopholes and lift sagging school funding, could ease the financial crunch his district is facing.

Proponents say the initiative would generate over $12 billion each year for California’s public schools and communities by making wealthy corporations and investors pay their “fair share” in property taxes. If it qualifies, Schools and Communities First will be on the November ballot.

Monterey County’s unequal school funding drew national attention last year following EdBuild’s 2019 ‘Dismissed’ report. In that report, the Carmel and Pacific Grove unified school districts — both with 38 percent non-white students — were spotlighted as big spenders, where per-pupil expenditures are about $24,183 per year and $18,843 per year, respectively. By contrast, neighboring Monterey Peninsula Unified School District, which has a student population that is 80 percent non-white, receives about $12,029 dollars per student, according to the report.

“Although Carmel Unified does have a higher than average per pupil spending amount, it still suffers from underfunding,” said Barb Dill-Varga, superintendent of Carmel Unified School District. “The problems posed by California’s dismal school funding levels are compounded by the high level of student need and our extremely high cost of living.”

Diffenbaugh said that in addition to its own underfunding, being surrounded by higher-spending schools creates added challenges for his district. “When you’re competing for teachers, school staff or principals, they have a larger budget to pay people more, so it creates an uneven playing field,” he said.

As for why these differences exist in the first place, largely it comes down to California’s school funding model.

MPUSD and most other districts in Monterey County get the majority of their funding from the state, and that money is allocated based on the Local Control Funding Formula (LCFF). Under the LCFF, schools receive “base” funding amounts calculated by their average daily attendance. Districts then receive additional funding based on how many “high need” students attend their schools, meaning English language learners, low-income students or students in foster care.

To add to its financial woes, MPUSD is also facing declining enrollment. Since funding is based on attendance, districts lose money when enrollment drops, something that MPUSD has faced since the closure of Fort Ord and has not abated. MPUSD is currently considering shutting down several schools as enrollment drops are projected to continue. District projections place lost revenue at $12.5 million between 2016 and 2026.

While much lower than its neighbors, MPUSD’s spending is in line with the state average, which — after a $2.7 billion statewide increase from last year — is budgeted at $11,993 per pupil for the 2019-2020 fiscal year, according to the California Department of Education.

Despite increases of about 23 percent since the Great Recession, California’s per pupil spending remains below the national average. When adjusting for the high cost of living, this gap extends even further.

On the other hand, Carmel and Pacific Grove Unified receive very little state funding. They are what’s known as “basic aid” districts, meaning they are funded primarily by local property tax revenue, which exceeds the amount they’d otherwise receive under the LCFF model.

While basic aid districts are associated with higher spending, they are subject to a different set of challenges.

“Property tax revenue is very uncertain and subject to dramatic changes,” said Dill-Varga. Additionally, unlike the LCFF model, basic aid districts don’t receive more funding when more students enroll. “This results in a situation where enrollment growth can adversely affect our finances and the level of programs we are able to offer,” said Dill-Varga. According to information from Ed-Data, enrollment within Carmel Unified is currently the same as the district had in 2013, after a peak in 2016.

Currently, average home prices in Carmel and Pacific Grove exceed $1 million, according to estimates from Redfin.

In Pacific Grove, increases in property tax revenue allowed for about a 6 percent increase in school district funding every year since 2016, according to assistant superintendent Song Chin-Bendib.

Still, Chin-Bendib noted that increases in funding are effectively canceled out by things like rising pension costs and staff raises. “Those costs have gone up exponentially over the last several years,” she said.

To help close the gap, Pacific Grove also relies on local PTAs, which fundraise for things like field trips and school supplies. “The PTAs are very, very crucial to every school district and especially to our school district. They help a lot,” said Chin-Bendib.

Since PTAs are funded by donations, wealthy areas tend to benefit the most as parents can afford to offer larger donations.

Districts across Monterey County are dealing with rising education costs, most with even less available cash on hand.

“K-12 school funding has not substantially increased, on an inflation-adjusted basis, for more than a decade,” said Monterey County Superintendent of Schools Deneen Guss, who  oversees all 24 Monterey County districts. “California’s investment in public schools is out of alignment with its wealth, its ambitions, its demographics and the demands of a 21st-century education.”

In Monterey County specifically, Guss said the student population of English language learners is 36.2 percent—about 17 percent higher than the state average. About 74 percent of students are “socioeconomically disadvantaged,” and 10.3 percent of students are homeless.

“These students do not benefit from the resources available outside of the school environment that more socioeconomically advantaged students have access to, and this widens the gap between the two groups,” said Guss. These resources could mean anything from travel sports to private tutoring or SAT prep classes.

Despite formidable challenges, Diffenbaugh noted that MPUSD is making significant progress. When he started at the district six years ago, he said, “We had no full-time mental health support at any of our campuses.” Now, the district employs one at each middle and high school, and one per every two elementary schools.

The district’s suspension rate has also “dropped dramatically” in recent years, while the percentage of CSU and UC eligible students underwent a “tremendous increase,” he said.

While Diffenbaugh is proud of this progress, he said, “No one in our district is satisfied with where we are because we know that our kids deserve the very best and we have a long way to go to get there.”

“There’s so many different areas where we could do more if we had more,” he said.

The concept of equity 

“While many educators aspire to the ideal of equity, the practice of equity in public education remains a work in progress, and there is much work to do,” Guss said. “From hiring and funding priorities to disproportionate academic outcomes and responsive interventions, public education faces an equity challenge.”

While achieving equity in education means different things to different people, the concept in general is understood as a system which provides all students with the tools they need to be successful according to their own needs. Unlike an ‘equal’ system, which treats everyone the same, an equitable system recognizes that some students might require additional or different resources than their peers.

Guss said that if Monterey County hopes to combat the “two-tiered” public education system, educators and district leaders need to focus on addressing each student’s diverse cultural, emotional, physical and academic needs.

“A vision for equity starts at the top. All educators — whether superintendents, teachers, instructional coaches, or directors of curriculum — owe it to their students and communities to explore their assumptions, knowledge, and skills with a willingness to disrupt unequitable systems so that we truly support ALL students,” wrote Guss via email.

In addition to examining internal biases, Guss advocates for increases in LCFF base funding and increased support for things like arts, school counseling, field trips and smaller classes.

Diffenbaugh noted that while increased funding is essential, integration of schools and communities is also critical. Currently, more than half of the nations school children are in “racially concentrated districts,” which are either mostly white or mostly nonwhite, according to another EdBuild report. Nationally, majority nonwhite school districts receive $23 billion less in state and local funding than majority white districts.

“We need to focus on integrating not just our schools but also our communities. As long as you have a system where your school is funded based on the property taxes of where you live — and we have a tremendously segregated society — then you’re going to have tremendously segregated schools and unequal schools in terms of resources,” said Diffenbaugh.

Special education funding presents an added challenge. “In California, the average annual cost to educate a special education student is $18,622 per pupil,” Guss said. “This amount continues to grow as the number of students with severe cognitive and developmental disabilities rises.”

Currently, federal contributions cover less than 9 percent of this cost in California, despite Congress committing to fund 40 percent of added special education costs when it passed the Individuals With Disabilities Education Act (IDEA-1975), which mandates the way that special education functions in public schools.

Nationally, the number of students served under IDEA went up 25 percent in the last 20 years. To keep pace with rising costs, Guss said, “California needs Congress to appropriate substantial additional funding to IDEA.”

Addressing these issues and achieving equitable education for all students will require hard work and collaboration across districts and communities, said Guss. “Equity is our focus and our goal in Monterey County, but it takes a village.” Diffenbaugh agreed, adding that, “In order to make these changes, we need everyone to advocate for an equitable funding system.”

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