In the past year, much has been made about Missouri’s teacher salaries. According to the National Education Association, Missouri ranks 50 out of 51 states (including Washington, D.C.) in starting teacher salaries. I have shown that we cannot put too much stock in that ranking, as it undervalues Missouri’s true starting teacher salary by putting disproportionate weight on small, low-paying school districts. For this post, let’s set that aside and for the sake of argument assume that Missouri needs to increase teacher salaries. If so, who should pay for it?
The policy conversation around this question typically assumes a state solution. Read the newspapers or listen to testimony before the state legislature and you will hear a clear narrative—it is the state’s responsibility to raise salaries. This ignores the fact that local school districts set the starting salary. Assuming the state is responsible also ignores the important role of local school districts in raising funds for schools.
The Missouri funding formula is a complex partnership of state and local effort. When the Department of Elementary and Secondary Education (DESE) determines how much aid each school will receive, the state calculates how much money the district can raise locally. In doing so, the state assumes a tax rate, or performance levy, of $3.43 per $100 of assessed valuation.
Yet more than 30% of all school districts in Missouri do not even tax themselves at the rate DESE assumes in funding formula calculations. In 2022, 162 school districts taxed themselves at rates lower than $3.43.
School property tax rates are set locally. Changes to tax rates are proposed by local boards of education and local taxpayers vote on those changes. Though Missouri allows for tax rates to vary among school districts, the state has instituted a required minimum rate of $2.75 per $100 of assessed valuation.
In 2022, 55 school districts taxed themselves at the state minimum rate. On average, these districts raised just 38.4% of their funding from local sources.
Missouri could go a long way in raising teacher salaries if these low-tax school districts would simply tax themselves at the state’s assumed performance levy. That, of course, has rarely been mentioned in serious policy conversations.
