20200311 Ed Funding Agreement

With the agreement announced Wednesday afternoon between pro-education groups -- especially Utah’s main teacher union -- and GOP state bosses, 2020 could be the best year for public school funding ever.

And with guarantees built into the Constitution and statutes, annual growth in the number of students and inflation coming into the school system will be funded each and every general legislative session.

“We always put education No. 1,” said Gov. Gary Herbert. The new compromise will ensure that from now on, he added.

GOP Senate leaders told reporters earlier in the day that with an increase to 6 percent for the Weighted Pupil Unit, the main per-student funding formula, the state will be increasing all monies for public schools this year to 9.7 percent.

And that doesn’t include setting up a $75 million special “rainy day” fund, perhaps more properly titled a slush fund, that schools can dip into in case estimated income tax revenue doesn’t come in this year -- or in future years.

All or part of that $75 million will be held in trust, and won’t go to schools unless needed. And, it is hoped, additional monies will go into that slush fund each year, as revenues allow.

20200311 Ed Funding Handout 01

20200311 Ed Funding Handout 02

That $75 million slush fund was earlier reported to be $100 million, so part of the $34 million it takes in ongoing money to go from 5 percent WPU increase this year (already given in the budget) to 6 percent WPU increase comes in that $25 million reduction.

The 9.7 percent increase in funding for public schools starting next fiscal year, said GOP legislative leaders, is amounts to $331 million that state economists estimate will come in new income tax revenue for fiscal 2020-2021, a budget that starts July 1.

“This is one of the most significant funding years” for public schools, said Senate President Stuart Adams, R-Layton.

Part of the deal with the Utah Education Association, which represents 18,000-plus classroom teachers, are guarantees of future funding for student growth and inflation inside the 41 separate school districts, among other perks, like $200,000 going into a “scholarship” fund to pay teachers who improve their classroom skills.

An internal modification will place public education spending into the current, constitutionally-protected Uniform School Fund, which will ensure no public school appropriations can be touched in years ahead -- a change that may sound small but has large fiscal impacts for schools down the road.

In return for the additional monies, the UEA agreed not to actively fight, as an association, changes Herbert and Republican legislators want made to the Utah Constitution’s current earmarking of all individual and corporate income taxes going to higher and public K-12 education.

Programs for the disabled and children will be added to that earmark -- allowing upwards of $400 million to $500 million in income taxes going into those programs every year in the future.

GOP leaders said the amendment will pass the Legislature now, but if language needs to be “adjusted,” Herbert will call a special session later this year in time for the ballot amendment to be altered.

That solves a real revenue distribution problem for legislative budgeters -- too little money in the sales-tax-fueled General Fund and too much income tax revenue in the Education Fund.

The main reason for last year’s failed tax reform package was that revenue distribution problem -- when GOP lawmakers and Herbert attempted to impose the state’s whole sales tax back on to grocery store food. A gas tax hike was also part of that package, repealed the second day of the 2020 Legislature after a voter revolt.

The constitutional amendment must pass both legislative houses by two-thirds -- which will happen Wednesday or Thursday --  and then go on the November ballot.

A big stick to convince most voters to approve Wednesday’s deal is that all these new funding sources/guarantees for public schools WON’T happen unless the amendment passes in November.

And with the UEA agreeing NOT to oppose the amendment, one of the largest potential anti-amendment forces is removed. Some individual teachers, or smaller pro-education groups, may oppose the change, but now with all formal pro-education groups, and Our Schools Now-type business groups, in favor, passage is likely.

A lot of folks worked on the compromise, GOP leaders said, but it likely wouldn’t have happened without House Majority Whip Mike Schultz, R-Hooper, and Senate Assistant Majority Whip Ann Millner, R-Ogden, who worked doggedly for the compromise, along with Herbert, who reportedly stepped in this week to bring the UEA and legislators together for the final push.

Heidi Matthews, president of the UEA, said the compromise “stabilizes and secures” education funding year after year, and especially in the face of economic downturns, that will come.

She praised Schultz by name, saying he “created a space” where all the pro-education groups could come together with GOP legislative leaders.

“This is a strong, strong, step forward” for public schools in Utah, she said.