MMA urges Joint Committee on Education to make substantial changes to school finance law

The Honorable Alice Hanlon Peisch, House Chair
The Honorable Jason M. Lewis, Senate Chair
Joint Committee on Education
State House, Boston

Dear Representative Peisch, Senator Lewis, and Distinguished Members of the Committee:

On behalf of cities and towns in all parts of the Commonwealth, the Massachusetts Municipal Association is writing to support legislation that would re-set and bring new vigor to the Commonwealth’s landmark school finance law that was adopted in 1993, more than 25 years ago.

The practice of public education has changed substantially over the past quarter century, while the basic building blocks of how we fund our schools has not been updated. The MMA was privileged to participate in the important work of the Foundation Budget Review Commission, and we support full implementation of the recommendations. We also support other changes to school finance law related to how we fund charter schools, ensure adequate minimum aid increases each year, and provide support for rural schools. In order to be successful, comprehensive modernization of our K-12 school finance system must incorporate all of these factors – implementing the FBRC recommendations, fixing the flawed charter school finance system, providing appropriate minimum aid, and addressing rural school challenges.

There are 17 bills before the Committee for public hearing today, and all offer serious proposals for updating school finance law. These include Governor Baker’s recommendation (H. 70); the comprehensive House bill (H. 576) filed by Rep. Tucker and many colleagues; the PROMISE Act bills (S. 238 and H. 586) filed by Sen. Chang-Diaz, Reps. Vega and Keefe and many colleagues; a small-town schools bill (S. 292) filed by Sen. Gobi; and important funding equity bills (S. 308 and S. 310) filed by the Sen. Lewis. There are other significant bills that will have a public hearing in the coming weeks, including the MMA’s charter school finance proposal (H. 418) filed by Reps. Cabral and Brodeur. We applaud your Committee, House and Senate leadership, all legislative sponsors and co-sponsors, and the Governor for advancing proposals to strengthen the Commonwealth’s education partnership with cities, towns and school districts.

The MMA’s testimony will focus on basic principles that we hope will inform the Committee as the school finance reform bill and the fiscal 2020 budget act are debated and enacted.

REFORMING AND INCREASING PUBLIC SCHOOL FUNDING
We strongly support substantial reform of the state’s decades-old school finance law, to update and increase Chapter 70 funding consistent with the recommendations of the Foundation Budget Review Commission. In addition, any school reform measure must rework how charter schools are financed to reduce the fiscal damage done to the local public school systems that have lost students to local or regional charters.

We acknowledge the Governor’s initiatives in H. 1 and H. 70, but ask that the Legislature enhance and improve these recommendations. For example, we are very pleased that the House bill (H. 576) and other proposals would use a much shorter time frame to implement important FBRC recommendations, rather than the 7-year approach by the Administration. This shorter phase-in is desperately needed. Also, we commend the authors of the PROMISE Act (H. 586 and S. 238) for developing an impressive framework to simultaneously implement the FBRC recommendations and address the fiscal damage caused by the flawed charter school finance system – these are interlocked issues and combining them is essential. For this reason, we suggest using the PROMISE Act as a starting place to build from.

Implementing Consensus Foundation Budget Review Commission (FBRC) Reforms
We support updating the Chapter 70 foundation budget factors consistent with the FBRC’s well- known recommendations. This includes accurate and realistic factors for special education and health benefits for active and retired school employees. It also includes enhanced and reworked increments for low-income and English Language Learner (ELL) students. We urge the Committee to support the fullest and fastest possible implementation of these formula reforms. We also support the proposal in the Governor’s recommendation to enhance the guidance and psychological services factor to reflect new best practices related to school safety and climate and social and emotional health. This is a helpful enhancement to the FBRC’s work.

Ending the Damage Caused by the Flawed Charter Finance System
We call for a school finance circuit breaker to mitigate the harm done to local public schools by the state’s method of funding charter schools. The charter school finance proposal in H. 70 is inadequate and would do little to help local schools. H. 586 and S. 238 include a thoughtful “district student aid floor” that would better integrate Chapter 70 and charter school finance and lessen the damage done by the current method. At today’s hearing you will hear many stories of the harm caused by the current system. Even if the existing charter school reimbursement formula is fully funded in the future, scores of cities, towns and school districts would continue to struggle to fund their regular (non-charter) public schools. Rising charter school assessments are forcing local public schools to cut programs and services to make up the difference. Because the vast majority of K-12 students attend regular public schools in these communities, this means that the existing charter funding system has a directly negative impact on the vast majority of schoolchildren. Of the cities and towns with the largest diversions, many have been deemed by the state to have underperforming schools. These include many the state’s poorest and most financially distressed cities and towns. The current system has the unfortunate effect of harming the most vulnerable and challenged school districts, communities and students. No update of the Chapter 70 framework will be workable or complete without correcting the major flaws in charter school finance.

Ensuring Adequate Minimum Aid to Leave No Community Behind
Even with the partial implementation of many of the FBRC’s recommendations in the Governor’s budget submission for fiscal 2020, 57% of our school districts – 183 cities, towns and regions ranging from smaller towns in western Massachusetts to our capital city of Boston – would only receive minimum aid, set at a woefully inadequate level of just $20 per student. 53% percent of all districts (168) would receive Chapter 70 increases of less than 1%. Under this scenario, all of these districts would be forced to cut existing school programs or further diminish municipal services. We ask that annual minimum aid increases be at least $100 per student to avoid the damage that would hit so many schools across the state. Because there is no perfect one-size-fits-all formula to address all of the dynamics in 351 diverse cities and towns, minimum aid is essential to ensure that no community is left behind. None of the major reform bills includes a commitment to adequate minimum aid increases each year, and we ask that you add this necessary element to the Committee’s legislation.

Addressing Rural School Fiscal Challenges
School finance is complex and multi-layered, with disparate impacts across different types of districts and in different parts of the Commonwealth. Even with the above reforms and policies, many smaller rural school districts would be left behind. That is why any meaningful school finance reform plan must also include provisions to assist rural school districts. H. 70 contains no fiscal relief for regional schools struggling with declining enrollment, even though further consolidation or other fiscal efficiencies are simply not feasible in these areas. We ask that the Committee support adding a rural school factor in the foundation budget to address this issue.

Summary
School finance reform is long overdue and must address needs in all districts. We urge the House and Senate to support and enhance the various bills before you today to truly update this vital part of the state-local partnership that is of fundamental importance to the quality of life in our communities and the long-term health of the Massachusetts economy. In order to be successful, comprehensive modernization of our K-12 school finance system will require timely implementation of the FBRC recommendations, fixing the flawed charter school finance system, providing appropriate minimum aid, and addressing rural school challenges.

Please contact us at any time if you have any questions or need additional information by having your office reach out to me or MMA Legislative Director John Robertson at 617-426-7272 ext. 122, or jrobertson@mma.org at any time.

Thank you again for your distinguished record of support, dedication and commitment to the cities, towns, and public schools of Massachusetts.

Sincerely,

Geoffrey C. Beckwith
Executive Director & CEO