On May 18, David Stokes joined The McGraw Show on KTRS to break down the end of Missouri’s legislative session. They discussed the passing of a gas tax increase, ESAs, some TIF reform for flood plain development, requiring online stores to collect taxes, the thought of expanding PACE loans in St. Louis County, and more.
The Good, the Bad, and the Ugly
Big shock—now that the Missouri legislature has finally created a program to give school choice to students from low-income families and students with disabilities, the misinformation campaign against the program has begun. Case in point: The Kansas City Star editorial board has fired a first shot at the Empowerment Scholarship Account program, and it has gone wide. Let’s talk about the good, the bad, and the ugly of this editorial.
The good: The editorial board acknowledges that parents want the best education for their children and this program may allow them to offset private school tuition, tutoring, or other educational therapies. They also acknowledge that the Kansas City Public Schools and the Hickman Mills district have struggled with low performance for years.
The bad: The editorial is incorrect in so many places. It quotes a claim that this program will drain $75 million from the education budget. In fact, the program is capped at $25 million and it is paid for through tax credits from general revenue, not education funding. It claims that every student who leaves KCPS or Hickman Mills for the program will take approximately $10,000 in state education funding with them. First, the state education funding formula provides $6,400 per student. But here is the real kicker: as a result of legislative negotiations, students who leave their public school to take a scholarship in this program will continue to be counted in the enrollment of their public school district for five years. That’s right, the district will receive state funding for those students for five years after they leave. And then strangely, editorial claims that this program will at once dismantle public education while raising concerns over a lack of available private school seats and the inability of parents to cover costs beyond the scholarships. How can both of these dire predictions be accurate?
The ugly: Here’s the crux of the editorial board’s argument and what really makes my blood boil. The board claims that we can’t let students leave low-performing districts because they take money with them. A quote from the Hickman Mills superintendent: “It is a direct attack on our student enrollment and the funding we receive from the state.” The scholarships that will be “doled out” are really just diverting “dollars away from the system.”
Imagine you’re a single parent, struggling to make ends meet. You have a child with a disability who is making little to no progress catching up to their peers and you worry every day about your child’s future. A scholarship-granting organization now exists that will allow you to apply for a scholarship for your child. You can look for a private school that specializes in your child’s disability. But your own superintendent wants to close the gate and lock it because your child represents thousands of dollars in state funding. You’re supposed to prioritize the finances of the public school district over your child’s well being.
Make no mistake, the drumbeat against allowing low-income parents or parents of children with disabilities to use public money anywhere other than their assigned public school is about to get louder. The threat just got real. The unfairness and hypocrisy of holding them hostage for their state funding astounds me.
How Much Does Your Local Public School Spend?
It comes as a surprise to most people who don’t follow education policy closely that we have never really known how much an individual public school spends per student. Historically, school spending has been reported at the district level, and the best we have been able to do is average that figure across all of the schools and students in the district.
As part of the Every Student Succeeds Act, passed by Congress in 2015, districts are now required to report spending at the school level. Unfortunately, those data can be hard to find, and aren’t available in an easy-to-access, user-friendly way. That is, until now.
Project Nickel has created a searchable database of school-level spending. You simply type the name of your local public school into the search bar, and you can find out how much it spends.
What you find might surprise you. Border Star Elementary, a beloved Kansas City public school, spends $21,982 per student per year. Sumner High in St. Louis spends $17,580. I could go on, but I recommend checking it out yourself.
To answer the question that will inevitably arise: The primary reason that different schools, even within the same district, spend different amounts of money is teachers. More senior teachers make more money than more junior teachers, so schools with higher concentrations of veteran teachers will spend more per student, on average. It is worth thinking about why some schools seem to collect large numbers of veteran teachers while others do not, but perhaps that is a topic for another day.
WATCH: The Case for a Conservative Economic Agenda with Ramesh Ponnuru
Conservatives have traditionally favored freeing markets and shrinking government. But new political and economic trends are leading many conservatives to question these old commitments. On May 12, 2021, in partnership with the National Review Institute, we hosted Ramesh Ponnuru, who made the case for a new conservative economic agenda.
Watch the full presentation here:
What Parents Want
The dust may be finally settling in public education, but not into a familiar pattern. EdChoice—a non-profit based in Indiana—has been conducting monthly polls of parents since last summer to see how they’re feeling about their children’s education. The latest round of responses (April 2021) indicate that parents are beginning to feel much better. Nearly two-thirds are now comfortable with their child returning to school—an 8 percent increase since March. And three-fourths of parents surveyed are planning on getting their child vaccinated against COVID-19.
By the start of the next school year, public education should finally be back to pre-COVID normal, right? Buses will be running and school buildings will be filled with students and teachers from 8 a.m. to 3 pm. Not so fast.
The most interesting (to me) takeaway from the April survey of parents is this. When asked “After (emphasis mine) the pandemic, if given the option, to what extent would you prefer schooling to be scheduled each week at home with a parent or tutor to provide the best education for your child?” just 47 percent of public school parents said they would prefer for their children to be educated “Completely outside the home.” Thirteen percent said “Completely at home.” The remaining parents want a combination of days in school and days at home—generally two of one and three of the other. Think about that—almost half of parents surveyed want a new normal.
Last spring, just about every parent with a school-age child was forced to try homeschooling. Clearly, many liked it and would like to continue. But the conundrum to me is what to do with the 4 out of 10 parents who want their kids home some of the time—say a couple of days a week. Should districts just ignore them? Should we assume that when that option goes away, those 20 million or so parents will just give in to reality?
Maybe it’s time to expand the definition of a public school. Could we have rotating in-person and at-home schedules? Could we let teachers form micro-schools with a few families from their school? Could we let the education hubs that have popped up to facilitate public education, like YMCA’s or Boys and Girls Clubs, get fast tracked as charter schools?
One thing I know for sure: The Missouri Department of Elementary and Secondary Education (DESE) is going to distribute state education funding to school districts based on the average daily attendance in their buildings a year or two ago. DESE is essentially going to pretend that it’s 2019 and every school-age child will be in a building full time. Reconsidering the definition of a public school would be a better way to have money follow children to the environment of their choice.
How to Put Missouri on a Faster Path to Recovery
Hoping to prepare for a busy summer of reopening, several restaurants last week in St. Louis’s Central West End held a job fair in hopes of hiring over 100 workers. Only about a dozen prospective employees showed up. No isolated incident, this flop is emblematic of the disappointing jobs report last Friday, in which job creation nationwide came in over 70% below the heady expectations of Wall Street and other forecasters who were anticipating a blockbuster number that reflected the accelerating reopening of America. Against this backdrop, employers posted a record 8.1 million job openings in the latest data from March, and a record 44% of small businesses in the National Federation of Independent Businesses April survey reported openings they could not fill. Although childcare and schooling disruptions remain ongoing concerns, especially troubling is President Biden’s extension of enhanced unemployment benefits into the fall that are paying nearly half of jobless workers more to remain unemployed than they used to receive on the job and another fifth of workers more than 80% of their previous wages while saving them on commuting and other work expenses. Recognizing that Missouri need not wait for Washington, DC, to correct its mistakes, Governor Parson wisely announced that Missouri would be ending the unemployment benefit enhancements to encourage work and enable small businesses to hire. This action removes a significant headwind to recovery.
As things currently stand, the American Rescue Plan promises jobless workers $300 per week on top of the usual wage replacement rate of just under 50% all the way into September. For most of the workers who are receiving nearly the same or more to remain jobless, it is understandable that they might be reluctant to accept a pay cut just to go back to work. For small businesses struggling to reopen, these unemployment benefits represent anywhere from a short-term headache to an existential threat. Many of them operate on small profit margins and cannot afford to compete with the artificial compensation offered by a federal government with a nearly endless capacity to borrow. Tacitly acknowledging the role of unemployment benefits in the lackluster jobs numbers, President Biden is now exhorting workers that “if you’re receiving unemployment benefits and you’re offered a suitable job, you can’t refuse that job and just keep getting unemployment benefits.” He has also directed the Department of Labor to work with states to reinstate job search requirements, which in their current form are mostly window dressing that cannot effectively monitor or induce search effort. Instead of trying to fill the leaky bucket caused by bad policy, the federal government ought to plug the hole and stop erecting hurdles to small business hiring and reopening.
In Missouri, the economy sports what sounds like a healthy 4.2% unemployment rate, but here, too, many Missourians have exited the labor force, and there are over 114,000 fewer people working relative to back in February 2020. Missouri’s recently announced termination of enhanced unemployment benefits is one positive step toward addressing this jobs shortfall and returning its economy to pre-pandemic strength.
The latest on a Gas Tax Increase and are Tourists “Free Riders”?
On May 13, David Stokes joined The Gary Nolan Show to discuss a gas tax increase that is headed to the Governor’s desk and a trend in Missouri local government – taxing outsiders.
Read David’s piece in the Springfield News-Leader and the Columbia Daily Tribune
Listen to more of The Gary Nolan Show
Excellent: Legislature Passes Bill Holding Local Governments Accountable
Congratulations to Rep. John Wiemann and others for passing House Bill 271, a now greatly expanded bill whose original language, carried by Rep. Wiemann, addressed a reform near and dear to my heart—local transparency. For the last few years, the Institute has been an active proponent of making state and local government checkbooks open to the public, and we’ve seen some progress with the creation of a great site that advances these ends in the Missouri State Treasurer’s office. House Bill 271 establishes a similar program in the Office of Administration, which takes us one step closer to the mandatory checkbook reporting we’ve long advocated. If local governments can take your money from you and spend it, they must report it, and if they can’t, well, that’s a problem. The bill moves us closer to fixing that problem.
The omnibus bill touches on other local government issues of interest to us, notably the manner and circumstances under which local governments can take away rights of association and commerce via pandemic “health orders” and lockdowns. Living in Chiefs Kingdom doesn’t make you Kansas City’s peasant, and the bill’s eminently reasonable restrictions on local governments’ ability to take draconian actions against Missouri residents were overdue. As with local checkbook transparency, the state has an obligation to ensure that local governments, which exist as a managerial convenience, are accountable for acts done in the state’s name. On health orders in particular, local governments far exceeded in the last year what the state should ever tolerate. Congratulations to Sen. Bob Onder for successfully attaching this limiting language to the bill and to Sen. Andrew Koenig, Rep. Jim Murphy, and others for adding fuel to the fire throughout the process.
House Bill 271 now moves on to the governor, who is expected to sign it. Congratulations to the legislators and advocates who achieved these objectives.
How Are We Recovering (Part 2)
As discussed in my previous post, our economy seems to be recovering quickly relative to other recessions, but employers are reporting increased hiring difficulties. This may be due to the changes in unemployment insurance (UI) and the effects on the labor market (the supply and demand of workers).
Generally, UI affects the labor market by changing job search behavior. UI decreases the gap in pay between working and not working. It creates an incentive for unemployed workers to take more time in their job searches, resulting in fewer job applications and longer jobless spells. On the other side of the labor market, the UI benefits that make it easier for workers to put off job searches and be more selective also make it more difficult and costly for businesses to hire, which reduces the incentive to post job openings. Ultimately, UI can damage both sides of the labor market.
Providing money to help someone between jobs isn’t inherently a bad thing, especially during difficult economic times. In fact, one justification for having an unemployment insurance system at all is that the added time spent searching for a job leads to the possibility of a higher-quality job fit, which has stabilizing effects on consumer spending. However, excessive generosity or duration of UI benefits can hamper the economic recovery following a recession.
Researchers have cited the extensions of unemployment benefits as playing a role in the slowest job recovery on record—the aftermath of the Great Recession—and other jobless recoveries. Similarly, eventual cuts to UI benefits after periods of extensions have led to large influxes of workers and decreases in unemployment levels.
All this research on the relationship between UI and the labor market makes me question whether our UI policy during this economic downturn has been optimal. The recent extension of unemployment benefits with the $300 weekly supplement may threaten to impede the pace of our current recovery as UI has in the past. Governor Parson has even decided to end Missouri’s participation in the federal pandemic unemployment benefits beginning on June 12th, saying that it’s time to get people back to work. The complicated topic of UI and our current recovery with be discussed in the next blog in this series.
