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DESE and the state board of education would have you believe that the pandemic has led Missouri families to simply keep their kids at home—just like the parents who are working remotely. That, they say, is the culprit. Incorrect. I have been making this point routinely over the past year. Missouri, as a state, has declining enrollment. Actually, K-12 enrollment is declining at the national level as well.

If you look at the following graph of the number of Missouri public school kindergartners each year, you can see that, after growing for a decade or so, enrollment peaked in 2013. Since then, pandemics notwithstanding, cohorts have been getting smaller and smaller. That peak is now in high school. Within a few years, the number of our high school graduates will begin a steady decline.

Missouri kindergarten enrollment: 2002–2022

If we take the position that this is a temporary problem and we manipulate the formula to make sure that overall funding stays the same (DESE actually asked for a $100M increase), we will be misappropriating taxpayer dollars. We need to fund the schools and students we have, not the schools and students we used to have.

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The lioness mom in me is concerned. I haven’t heard anything about professional development over the summer preparing teachers to effectively teach virtually on a new online platform. I don’t know if the teachers will bring the same level of care and passion when teaching virtually. And I don’t know how my kids will handle full-time virtual learning.

I also can’t ignore that, to the school, my children represent funding; there is an incentive for the district to keep them enrolled in our school. The district provided no information about the proven virtual alternatives available via the Missouri Course Access and Virtual School Program (MOCAP). If I wanted to enroll in something like K12.com, which was “designed as an alternative to traditional ‘brick and mortar’ education for public school students from kindergarten to 12th grade,” I would need my school district’s permission and would have needed to start the process weeks ago. Many schools are just now announcing their plans for fall 2020, which leaves parents with little time to react and explore alternatives. On July 29 we learned the district will now be going all virtual for at least the first nine weeks.

I am very concerned about my kids falling further behind typical grade-level expectations and forever playing catch up if I simply go with the flow. I realize that teaching my kids is no small task, and as their parent I am responsible for ensuring they get what they need. For my fourth-grade son, we plan to join a few families with fourth graders and create a micro-school. The district’s virtual learning program will be facilitated by one of the moms and we will include some other programming. For my sixth-grade daughter, we are going to do both virtual education with our school district and hire a tutor. If and when in-person learning is possible at our school, she will return to the in-classroom format, which we believe is best for her learning needs.

The pandemic has highlighted the need for parents to direct the education of their children and take responsibility to ensure they have every opportunity to academically thrive. Many will figure out a way to make something work this year because most parents are tireless when it comes to figuring out what’s best for their children. But it didn’t need to be this difficult. I don’t think parents will forget—or forgive—what they had to endure this year because of the failings of the education establishment in Missouri.

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The fact that Missouri has not fully funded the formula has been a rallying cry for more education spending. Indeed, educators across the state have claimed that we are “underfunding public education.” This new budget proposal has me wondering what will happen to those calls for increased spending when the state finally does fully fund the formula. Will they die down, or will they persist? To answer this question, it is important to define “underfunding” public education. Below, I explain three ways to think about education spending.

Constitutional Obligations

State constitutions vary in what they require in terms of education spending. Some state constitutions say very little. Others call education a “paramount duty” of the state. In Missouri, the constitution explicitly requires the state to spend 25 percent of state revenue on public education, which the state regularly does. The Missouri Supreme Court has upheld the funding system as recently as 2009.

Formula Obligations

The legislature is responsible for creating a formula to fund public schools. Missouri uses a foundation formula, which calculates exactly how much the state should spend on each student in the state. The Show-Me Institute recently released an updated version of my paper, “A Primer on Missouri’s Foundation Formula for K-12 Public Education,” which explains exactly how schools are funded by the state.

In creating the formula, the state creates what may be seen as another form of obligation—a stated obligation of adequacy. This obligation may be separate from a constitutional requirement, but it nevertheless creates an expectation among public school officials. They expect lawmakers to fully fund the formula they created. As we have seen failure to do so creates a useful talking point for advocates of higher education spending—we are underfunding the formula.

Now, it seems that argument may disappear.

Moral Obligations

What happens when Missouri fulfills its constitutional and formula obligations to fully fund public education? This will take some of the wind out of the sails of advocates for higher education spending, but it certainly will not end calls to increase funding. The truth is that individuals have their own views on education. These views may or may not be informed by research, but ultimately they flow from our own personal values, beliefs, and morals. I call this the moral obligation to fund schools. The level of this obligation is not universal; rather, it varies from individual to individual.

I applaud the legislature’s effort to fully satisfy both constitutional and formula obligations in funding Missouri’s schools. Nevertheless, we should anticipate continued calls for increased spending. Those calls, however, will be easier for lawmakers to address when they can point to a fully funded formula. 

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It’s hard to read a story about education in Missouri without seeing that public schools are “underfunded.” What they are really saying is the legislature is not fully funding the formula that determines how much each school is supposed to receive—the Foundation Formula. Some suggest the shortfall comes from the economic downturn of a few years ago. Others say taxes aren’t high enough to generate sufficient revenue to fully fund the formula. Both theories imply something is wrong with the dog—either he’s too sluggish, or we aren’t feeding him enough.

Here is another explanation: Fully funding the formula is difficult because the funding formula continues stepping on the gas.

The Foundation Formula is designed to continually increase. How much schools should receive from the state is determined by something called the “state adequacy target.” The target is recalculated bi-annually and, by law, can never go down.

Now, follow me here for a minute. The target is based on how much Missouri’s successful school districts spend per pupil. Setting aside whether that is a good idea in and of itself, let’s imagine the legislature appropriates an extra $400 million dollars to the funding formula. What would happen to spending in these districts? It would go up, of course. Subsequently, when the state adequacy target is recalculated the target would go up again. . . and so on.

We already see this happening. From the 2015-16 school year to the 2016-17 school year, the state adequacy target will increase $230 per student. The goal of fully funding public schools just went up another $203 million.

Despite the continually growing requirements of the formula, the state does not adjust “local effort”—the amount the state expects districts to raise locally. Right now, the Department of Elementary and Secondary Education uses assessed property values that are over a decade old. Property values, and taxes, have gone up in the meantime. Yet, the formula doesn’t capture these changes.

Try as they might, lawmakers will have a tough time ever fully funding the system, because the very act of increasing funding leads to the requirement of another increase in the formula amount for the next year. Just like Fido, they’ll always be looking into an exhaust pipe.

This isn’t to say that Missouri should or should not spend more on K-12 education. Rather, these illustrations demonstrate the need to restructure the formula so it is more dynamic and attuned to the changing demographics of school districts. 

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Shuls explained that we shouldn’t view our public school system as underfunded. Rather, we should view the system as set up poorly. He suggested reforming Missouri’s K-12 foundation formula:

We can make the formula far more rational. We can stop paying districts to educate students who no longer live within their boundaries. We can stop pegging funding targets to the wealthiest districts. We can stop holding local effort constant by using current assessments. And, if we’re going to have a system that allocates state aid fairly, we must.

The number of solutions he proposed was the most persuasive aspect of his examination of the funding “problem.”

He concluded, “It’s time to stop asking why we are underfunding our formula and start asking how we might design a better school funding system.”

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Right now, there are 191 districts with 350 or fewer students enrolled. These districts get less than half of their funding from local sources, 46 percent on average. The rest comes from state (44 percent) and federal (10 percent) sources. The smallest district in the state, Gorin R-III, for example, has just 19 students enrolled. The district raises just 38 percent of operating expenditures locally, while 54 percent comes from the state. Then there is Plainview R-VIII, enrollment 81. With the low tax rate of just $2.9123 per $100 of assessed valuation, Plainview raises just 28 percent of the operating funds locally, while 63 percent comes from the state. In all, 141 of the small districts receive less than half of their funding for operating expenses from local sources.

These districts are able to exist because of generous state support. Specifically, the state legislature sets aside $15 million for school districts with fewer than 350 students. This is in addition to the funding that comes through the state’s foundation formula for K-12 public schools.

In my last post, I discussed House Bill 1292 and asked if school consolidation was an issue of local control. I received a couple of comments that said it was. Maybe they are right. Maybe it should be a local decision to join with a neighboring district. Whether these small districts should receive additional state funding, however, is not an issue of local control. It is an issue that all taxpayers and all state policymakers should have a say in.

Should school districts be too small to fail? That is, do small school districts deserve extra financial support because they may close if they do not receive extra funding?

I am completely sympathetic to arguments of local control. However, I’m concerned too many claim local control only when it suits them. It certainly seems contradictory to claim sovereignty, while going hat in hand to state taxpayers for additional funds.

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For 16 years, the awards have given thousands of Arizona students more choices. This case study highlights research demonstrating that the scholarships give families across the state, including low-income families, access to private schools.

Read the full case study: 

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“The district makes money whether we enroll one student or 160,” Prescott said. “K12, Inc. charges a fee for each course. It might be $400 a semester. For a student who takes six classes for both semesters, that’s $4,800 a year. We count that student as full time and we get $7,000 from the state, which nets the district about $2,000 per student.”

I wonder whether the St. Louis Public Schools’ Virtual School, which also contracts with K12, is equally lucrative. I would guess not, because SLPS requires students to meet with a district teacher in person at regular intervals. Those meetings could bring up staff costs.

Given that districts can earn a profit from teaching students online, why don’t more of them form virtual schools? I can suggest a couple of explanations. Most districts probably don’t know much about online courses or what they could gain by enrolling students in them. Until recently, distance learning was the domain of old-fashioned correspondence schools, online charter schools, and state-level virtual schools. Traditional districts weren’t involved. Districts are used to a system in which they get revenue based on how many students are sitting in classrooms. The concept of earning more by sending students to a different environment goes against their experience.

It could also be that some districts view virtual schools as an admission of failure. If students choose virtual instruction over in-class learning, maybe that means that the brick-and-mortar component of the district wasn’t so great all along. I don’t think that’s an accurate analysis, because no single educational method is right for everyone. But I can see how districts might reach that conclusion in a school system of few choices.

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