Who Is to Blame for Underfunded Schools?

Education funding is an ever present issue in state budgets and Missouri is no exception. My colleagues have written about school funding and funding formulas for a while. But a new story from the St. Louis Post-Dispatch makes it clear that one significant cause of underfunding is the cities themselves. From the piece:

In a little-noticed update to a report tallying the amount of forgone revenue due to the development subsidies, the city now says the value of those incentives was $29.6 million in the fiscal year that ended June 30….

The school district relies far more heavily on property taxes, collecting about 61 cents on each tax dollar paid. That means the district, which has little to no say over whether property taxes are abated on real estate projects, missed out on about $18 million in revenue last year.

The Kansas City Public School District (KCPS) has estimated that it loses about $26 million each year, but an exact number should be available once the city of Kansas City issues its own report based on the same updated national accounting standards. Meanwhile, KCPS is considering a general obligation bond or levy increase to make up for those lost funds.

Meanwhile, infighting among schools over money could harm students’ prospects. The St. Louis Public School District  is suing to get $42 million that officials believe was given erroneously to charter schools as part of the city’s desegregation plan. If the district is successful in their suit, many charter schools will be adversely affected, which could lead to less choice for St. Louis parents and fewer high quality schools for St. Louis children.

Bad economic development policies such a tax-increment financing (TIF) lead to underfunding of basic services such as education and public—which in turn leads to education infighting, more borrowing, or higher taxes for the rest of us. None of that is good.

If We’re Going to Administer Standardized Tests, Let’s Make Them Useful

In 1988, kids enjoyed their video games on an 8-bit Nintendo, people listened to music on cassettes, and the World Wide Web did not yet exist. Things have changed a lot in the past 30 years. Indeed, the rapid development of technology has improved almost every aspect of our lives. Yet, something strange has happened in Missouri when it comes to educational assessment. Despite three decades of unprecedented growth in technology and our understanding of testing, the standardized tests we administer today are worse than they were in 1988. That’s right. After 30 years and millions of dollars in research and development (maybe billions if you include what has been spent nationwide), our tests tell us less than they used to.

Missouri’s first statewide movement toward test-based accountability came in 1985, when lawmakers passed the Excellence in Education Act. Yet in 1988, Missouri still did not have standards or testing as we know them today. Instead, schools used the California Achievement Test, a standardized testing package sold by the McGraw-Hill publishing company. It is a norm-referenced aptitude test.

After students took the test, a report like the one below would be sent home. It told parents a lot about how their child performed. Parents could see their child’s Grade Level Equivalent, which indicated whether students were on track. They could also see how their child stacked up to other kids locally and around the nation with percentile ranks. Moreover, the report indicated specific strengths and weaknesses for each student. In other words, the tests actually told you something. Unfortunately, that’s not the case today.

1988 test result printout

Fast forward to today. Missouri has developed standards for each grade, and students are tested every year in grades 3 through 8 and in various high school subjects. The state has spent considerable time and resources to develop a comprehensive accountability system built on standardized tests. Take a look at the report below and see what we have accomplished in the past three decades.

2017 test result printout

This report from a year ago gives parents little to no useful information. In fact, there are only two important pieces of information on the entire page: the scale score and the level of proficiency. The former is useless, and the latter is inadequate. The scale score, as presented here, has no meaning. What is a 539? What’s the lowest score possible? What’s the highest, the average, etc.? We can make no sense of 539 because we are given no context. We can see whether our children are “below basic,” “basic,” “proficient,” or “advanced,” but even this doesn’t help us much because we are not told any specific information about our child. Take a look at the section that explains what “proficient” means. If offers broad generalizations, whereas the 1988 exam offered student-specific suggestions.

Keep in mind, parents still have to wait roughly four months to receive these results. Even if the results weren’t useless, they’d almost be obsolete by the time they arrived.

How is it possible that we have come so far and not gotten anywhere?

It’s time for a change, and Missouri school leaders know it. St. Louis Public Radio has reported that more than 40 superintendents have formed the Missouri Assessment Partnership in an effort to improve these tests.  They want to do so because the tests are used for school accountability, but we also need changes to make these tests provide useful information to parents.

Standardized testing can serve a useful purpose, but not if we can’t make any sense of the results.

Don’t Complicate Prevailing Wage Repeal

For the last year or so, momentum has built behind the idea of reform to the state’s prevailing wage law. Between the prevailing wage’s negative impact on public construction costs and its unrepresentative calculation of market wages for professions in Missouri, reform is overdue. The simplest solution to the problem would be a simple repeal of the law. Twenty-two states don’t have prevailing wage laws. Missouri should join them.

It is disconcerting, then, that a minor bevy of similarly complicated prevailing wage “reforms” keep creeping out of the shadows. One would peg wages to county wage averages; another would lightly tinker with wage reporting requirements. Sometimes the prevailing wage would attach. Sometimes it wouldn’t. And so on.

Just stop.

I understand the appeal of keeping the prevailing wage in place to construction interests, since it props up their pay. However, legislators should be supporting the interests of taxpayers and acting to steward taxpayer money, not conjuring new ways to rebrand a Rube Goldberg public construction wage system that frankly shouldn’t exist. To put it plainly, this is a question of taxpayer interests versus special interests. Policymakers shouldn’t complicate an issue that, in the end, is that simple.

Hoosier State Helps Home-Sharing

Indiana Governor Eric Holcomb has been sent legislation forbidding local governments from banning Airbnb and other short-term rental companies (STRs). Previously, cities in Indiana had, according to The Indianapolis Star, “prohibited people from renting out space that wasn’t their primary residence on a short-term rental platform.” Missouri would be wise to follow Indiana’s lead.

Cities across Missouri, including Kansas City and towns around St. Louis, have banned Airbnb outright in some areas. As we’ve written previously, this is an onerous and likely unconstitutional restriction on property rights. In 2017, home sharing advocates supported state legislation that would have pre-empted localities from imposing fees or prohibiting STRs outright, while permitting those subdivisions to impose “reasonable regulation” to “protect the public’s health and safety.” It may have been those undefined regulatory allowances that killed that bill, as supporters abandoned the effort at the end. A similar bill is being considered by the Missouri legislature this session.

The economic case for home sharing is compelling. Contrary to opponents’ fears, home sharing seems to increase home values in the surrounding area. However this has raised the concern that it increases rents as is displaces available housing units, although it hasn’t seemed to affect the hotel industry as much as hoteliers feared. As the industry matures, we will learn more about the consequences, intended or otherwise, of this new opportunity for homeowners.

Our guiding principle, however, must not be fear of change or of disruption, but protecting the economic freedom and individual liberty of Missourians. Protecting property rights against neighborhood NIMBYs remains a worthy endeavor.

Reform Missouri’s Mandatory Minimums

In the 80’s and 90’s, politicians from both parties wanted to be tough on crime. A favored tool was stripping judges of their discretion in favor of mandatory minimum sentences set by the legislature. Unsurprisingly, prison populations have gone up. But has the investment of public dollars been worth the return on public safety? The research tells us that it hasn’t.

Missouri leads the Midwest in incarceration rates, and we’re eighth highest in the nation. We just recently lost to Kentucky our position of having the highest incarceration rate for women. If we do nothing to slow the flood of new inmates, Missouri will need to spend about $485 million in the next five years to build and operate two new prisons. For comparison’s sake, the entire budget of the state Department of Corrections is $725 million in 2018. (It was $580 million in 2006.)

According to the Missouri Department of Corrections’ 2016 Profile of Institutional and Supervised Offender Population, 41 percent of inmates are incarcerated for nonviolent and/or drug-related crimes. These two offender groups, incidentally, are the fastest-growing populations since 2011. Missourians could save hundreds of millions of dollars if courts had the flexibility to sentence these offenders to treatment programs or probationary periods prior to locking them up—while still retaining the ability to protect us from violent or habitual offenders.

Furthermore, research indicates that large sentences are not as effective a deterrent as swift capture and conviction. And large sentences are expensive, and not just in terms of the public dollars used to house and feed inmates. They also impose a significant cost on families and make it harder for ex-offenders to re-enter the workforce and become productive members of society.

The good news is that there is a better way.

Other states, such as Texas, have found ways to increase public safety and reduce recidivism while reducing public spending on prisons. Reducing mandatory minimum sentencing in certain circumstances is a part of that public policy strategy. Let’s return to judges the discretion they need to separate violent offenders from those who pose less of a threat. To do nothing will put greater pressure on public coffers while offering no respite from crime.

Summer Internships

Summer Intern

The Show-Me Institute is pleased to offer internship opportunities for Summer 2018.

  • Internships are open to current undergraduate and graduate students, as well as recent graduates.
  • Internships last approximately ten weeks. The exact starting and ending dates are flexible, but we anticipate that each internship will run from June 4 until August 17.
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  • Interns will assist staff members with a variety of tasks. These may include researching public policy topics, organizing events, and writing and editing op-eds, newsletters, studies, and other documents. Some administrative and clerical tasks also will be required.
  • Policy internships as well as communications and development internships are available.
  • A Show-Me Institute internship is an excellent opportunity to improve your research and writing skills. Each intern will produce regular blog posts and an op-ed on a public policy topic of interest to him or her. Each intern will receive feedback and assistance from SMI staff members throughout the process.
  • Internships are located in either our St. Louis or Kansas City office.
  • Interns will be paid on an hourly basis.

Those wishing to be considered for an internship should submit the enclosed application and the requested supporting materials. The deadline for applications is Friday, April 27, 2018. However, we will begin conducting interviews as applications are received. Applicants can expect a decision in mid to late May.

About the Show-Me Institute

Founded in 2005, the Show-Me Institute is a non-partisan, non-profit public policy research organization. The mission of the Institute is advancing liberty with responsibility by promoting market solutions for Missouri public policy. For more information:

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An Opportunity for Responsible Criminal Justice Reform

Earlier this year, I wrote about the need for broader criminal justice reform in order to avoid spending nearly half a billion dollars on two new prisons over the next five years. Legislation has been introduced that would adopt the recommendations from the Justice Reinvestment Task Force that could help Missouri avoid taking on this large expense.

One major component of these reforms would be to increase the number of community treatment centers for substance abuse and mental health. Currently, 35 percent of admissions are for in-prison treatment because no alternative exists in the offenders’ community. Unfortunately, the task force found that Missouri’s in-prison treatment programs are ineffective, thus wasting taxpayers’ dollars. Establishing more community-based treatment programs could produce much better outcomes and be a better use of the state’s resources.

The proposed legislation would also assist law enforcement in combatting violent crime, increase access to victim compensation, and adopt better practices throughout the Department of Corrections to reduce recidivism. Given that Missouri’s prisons are already over capacity, pursuing these reforms would be a step in the right direction.

Why Can’t They All Be Like Winfield?

One question that drives our municipal checkbook project is: What is the cost of transparency? Because Missouri’s sunshine law allows cities to charge for the time it takes to fulfill requests, it is not uncommon that producing public records will come with a price tag attached. When we sent sunshine requests for expenditure records, cities had the discretion to either charge nothing for these records, or—like the City of Battlefield—quote a price of over $35,000.

One argument we have heard from skeptics of checkbook transparency is that small cities like Battlefield (population 5,590) cannot afford to provide spending records at a low cost. Certainly, different cities have various staffing levels and challenges, but responses like Battlefield’s should raise concerns. And while we do not expect small cites to have the same resources as the City of Saint Louis, several cities provided us their expenditure records free or at very little cost, and some of those cities are smaller than Battlefield.

Consider the example of Winfield (population 1,404), which stands out not only because it shared its expenditure records free of charge, but also because of its commitment to transparency. When I spoke with the mayor, he said that while he loved our Municipal Checkbook database, his city could not afford to host its checkbook on its own website.

But after I told him we planned to put the city’s records in our database, he said that he would provide a link to our website so citizens could see how Winfield is spending its money. And if you check out Winfield’s website today, you’ll see that link. He also said the city was in the process of updating its transparency portal on the city website—not bad for a city of fewer than 1,500 people.

Cities, no matter their size, should provide easy access to information about how they’re spending our money, and modern accounting software used by most cities allows for quick generation of accurate reports. In Winfield’s case, the city saw in the Checkbook Project a tool to increase its own transparency. I applaud its commitment to promoting a culture of municipal accountability and good governance.

Charter Schools 101: Why Would We Need Charters in Suburban, Rural, or “Good” Districts?

In addition to fielding questions about what a charter school is, and whether charters are private or public schools, I’m often asked: Aren’t charter schools intended for failing urban districts serving low-income students of color? They do serve those communities well, but let’s talk about who else they serve.

While it’s true that over half of all charter schools are in urban districts, in the 2015–16 school year there were nearly 1,800 suburban charter schools and over 1,200 in small towns and rural communities.

It turns out that curriculum really matters to middle-income parents, and many gravitate to charter schools because they offer educational models that aren’t available in traditional public schools. Some of these models are more rigorous, some are more open and creative, and some offer unique programs. There are hundreds of examples of outstanding suburban and rural charter schools, but I’ll offer just a few to ponder.

Take the BASIS charter schools: In the 2017 US News rankings of the top 10 public high schools, nine were charter schools and five of these were BASIS charter schools. BASIS currently operates 20 charter schools in Arizona, Texas, and Washington, DC. Most of them are suburban, and they serve populations that reflect their communities. Like all charter schools, BASIS schools don’t have admissions tests—students are admitted by lottery. But once they’re in, it’s not easy. In this preschool through grade 12 program, students take biology, chemistry, and physics before they start high school and all high school students are expected to pass at least 6 AP exams. The key to success in BASIS schools is having highly professional teachers who are subject matter experts. Teachers are given considerable autonomy in their classrooms, but all of them, even kindergarten math teachers, must have a college degree in the subject they teach.

Or, what about the NYOS (Not Your Ordinary School) charter school in Austin, Texas? This school was founded twenty years ago and offers smaller class sizes, year-round school and “looping” (in which a student stays with the same teachers for several years). NYOS serves 950 students in grades K through 12, but they have 3,000 more students on a waiting list for a spot.

But many small towns are taking advantage of charter schools also. Graysville, Indiana opened Rural Community Academy in 2004 when their local school was slated to close. Since then, the school has grown to 150 students and some credit it with reinvigorating the community, saving the post office, and bringing several new businesses to the area.

Rural charters aren’t always opened to save a school, though. The Upper Carmen Public Charter School in Idaho was founded in 2005 “to complement the existing public school system by providing an alternative learning environment to enable more students from Lemhi County to be successful.” This school serves no more than 90 students and emphasizes personalized learning that allows students to progress at their own pace, rather than be grouped by age. Upper Carmen Charter School has consistently ranked among the top ten percent of schools in Idaho.

Asking if there are any good charter schools outside of major cities is like asking if there are any good restaurants outside of major cities. Of course there are. Teachers, parents, and community leaders with great ideas for educating kids are everywhere. Charter schools aren’t a perfect fit for every student, but they’re a great fit for the students they serve.

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