The cuts keep coming: More damning data on the state of NC public school funding

A recent lead editorial in Raleigh’s News & Observer editorial “NC GOP leaders ignore recession cuts when touting funding increases” makes several good points concerning the state’s declining commitment to funding public schools. As the editorial mentions, legislative leaders’ claims that they have increased spending on public schools are “at once true and deceptive” since they compare today’s spending to the temporary budget reductions implemented in the throes of a historically bad recession.

A deeper look at the data, however, shows the decline in support for public schools is even greater than indicated by the editorial. Along nearly every measure, North Carolina’s public schools have fewer resources today even when compared to the last budget passed under a Democratic-controlled General Assembly. While it is true that the nominal budget for public schools has increased slightly from its nadir in FY 2010-11, North Carolina’s public schools themselves have not benefited from higher resource levels since the change in General Assembly majority. The nominal budget figure has increased due to growing student headcount, moderate pay raises for teachers, and the rising costs of the state’s health and retirement programs. These increases, however, mask diminishing resource levels for North Carolina’s public schools.

School districts in North Carolina receive their state funding via various “allotments” of funding.  These allotments fall into two categories: “position allotments,” whereby the state guarantees to pay the salary and benefits of whoever is hired by the school district based on the appropriate salary schedule, and “dollar allotments,” which provide school districts cash from which to fund certain operations.

On a per student basis, all three state position allotments have been reduced since the change in General Assembly control. As compared to FY 2010-11:

• The per-student number of state-allotted teacher positions has fallen 2.6%.
• The per-student number of state-allotted instructional support positions (nurses, counselors, librarians, etc.) is down 8.6%.
• The per-student number of state-allotted principals and assistant principals is down 8.8%[1] .

The story is just about as grim when looking at the dollar allotments. Of the ten largest dollar allotments, six have been cut since FY 10-11 when adjusted for inflation and student headcount:

• State funding for teacher assistants has been cut by 38.5%.
• State funding for classroom supplies and materials has been cut by 38.4%.
• State funding for central office support has been cut by 25.5%.
• State funding for low wealth counties has been cut by 16.3%.
• State funding for students with limited English proficiency has been cut by 11.4%.
• State funding for transportation of students has been cut by 3.6%.

A seventh allotment for janitors, clerical workers, and substitute teachers has also been reduced (by 18.6%) if you take into account federal stimulus funding that allowed North Carolina to pay these workers from federal funds on a temporary basis in FY 2010-11.[2]

Of the three dollar allotments that have increased since FY 2010-11, school districts are not necessarily benefiting from greater resources.

Funding for children with disabilities and at-risk students have only increased due to increasing student headcounts or labor costs in those categories. The General Assembly has failed to take any actions to direct additional resources to these students. The third category that has increased since FY 2010-11, textbooks, remains woefully inadequate at nearly 40% below pre-recession levels.

Additionally, the General Assembly has failed to restore certain funding streams, such as state funding for professional development and mentors for beginning teachers. Both of these state allotments had been eliminated on a temporary basis in FY 2010-11, but were subsequently eliminated permanently.

Instead of focusing on genuinely increasing school resources from recession-era levels, the General Assembly has prioritized employee salaries and benefits.

North Carolina’s teacher salaries remain among the least-competitive in the country. A recent analysis from the Economic Policy Institute measured each state’s teacher salaries against the salaries of other college graduates in the state. According to their figures, North Carolina ranked 49^th for teacher wage competitiveness, with only Arizona offering less competitive teacher salaries.

The other factor driving up public school budgets – employee benefits – has gotten more expensive without becoming more generous to employees. Approximately $660 million of current-year funding for schools reflects inflationary increases in the cost of retirement and health care benefits since FY 2010-11. The State Health Plan has actually gotten less generous, with workers assuming a greater share of their healthcare costs since the recession. While the General Assembly deserves credit for continuing to fund retirement obligations, increased spending on the state retirement plan doesn’t help a district buy textbooks or chalk. In fact, increased salary and benefit costs erode school districts’ purchasing power from federal and local sources, which are not adjusted to reflect increases in labor costs.

No matter how you slice it, public school resources have been reduced in recent years, even if you accept the depths of a recession as a valid point of comparison. Recent budgets have steadily chipped away at school district resources, belying the claim that today’s leadership has committed to education. A commitment to education can be measured by the resources provided, and by nearly every measure North Carolina is falling short.

Kris Nordstrom is an Education Policy and Finance Consultant who works with the North Carolina Justice Center’s Education and Law Project.

[1] Figure for principals and assistant principals based on FY 15-16 position allotment, as data is unavailable for FY 16-17.

[2] All changes based on FY 16-17 enacted budget, which does not include distributions to allotments from reserves for salaries and benefits.  Percentage changes will be reduced slightly upon certification of budget, but will not change the underlying story of reduced resource levels for these allotments.