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I_SFinance_2017A 11/09/2017 09:07:09 AM Committee Summary

Final

STAFF SUMMARY OF MEETING



LEGISLATIVE INTERIM COMMITTEE ON SCHOOL FINANCE

Date: 11/09/2017
ATTENDANCE
Time: 09:07 AM to
Buckner
X
Gardner
X
Place: LSB B
Hamner
X
Leonard
X
This Meeting was called to order by
Lundeen
X
Representative Garnett
Merrifield
X
Sonnenberg
X
This Report was prepared by
Zenzinger
X
Josh Abram
Hill
E
Garnett
X
X = Present, E = Excused, A = Absent, * = Present after roll call, R = Remote Participation
Bills Addressed: Action Taken:
Opening Remarks from Committee Members

Framing Remarks from Consultants

Federal Resources

LUNCH

Committee Discussion: Subcommittees / Field Trips / Other

Concluding Thoughts
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09:10 AM -- Opening Remarks from Committee Members



09:10 AM



Members of the committee made their opening remarks.



09:13 AM -- Framing Remarks from Consultants



Rich Cedar, Chris Cross, and Mike Goetz (collectively Cross & Jofftus or C&J) addressed the committee. (Attachment A)




Attachment A.pdfAttachment A.pdf



C&J challenged committee members to consider what problem they are trying to solve, and asked that today's discussion focus on allocation, with more detail about financing reserved for later meetings; C&J presented the mechanics of the Colorado school finance system with a quick comparison of how other states approach their model. Members asked some clarifying questions.



09:32 AM



C&J provided an overview and discussion of enrollment count/ and district specific factors in the budget. C&J explained that Colorado uses a proxy for identifying at-risk students in the formula (a conversation about at risk will occur at a future date) and discussed the way Colorado adjusts the base per pupil funding with district specific factors and the budget stabilization factor. C&J made quick reference to categorical program funding in the Total Program amount. C&J discussed other funded education programs outside the formula. C&J will present more in depth on these other education programs at a later meeting to discuss how these might be modified, rolled together, or be part of the future formula.. The committee members discussed the idea of identifying a comprehensive list of other education funded programs, and were interested in details about the number, type, size, funding amount, allocations, student participation, etc of these other programs.




09:50 AM



Discussion moved to Funded Pupil Count and the way that Colorado identifies student enrollment for purposes of calculating school finance. C&J discussed other possible ways of counting students, and the pros and cons of using these count methods including counts by: Grade Level, Average Daily Membership (ADM) and Average Daily Attendance. The committee discussed the rolling averages used to adjust enrollment count for declining enrollment districts, and comparisons of averaging with the single student count date led to a question about how averaging and hold harmless create a cost to the system; members asked if C&J can estimate that increased cost. This needs to be part of future discussion once the data is brought out.




10:10 AM



Discussion moved to counting kids by grade level; i.e., where different grades get different count values. In Colorado, Kindergarten is counted at .58.




10:20 AM



Discussion turned to adjustments made to the formula from district specific factors such as personnel cost differences; also discussed were the different indexes that can be used to make this determination. For example: Comparable Wage Index or Hedonic Wage Index. Colorado uses a cost of living study but there are other indexes. C&J described how these adjustments are used to change the base amount in a foundation formula. Intent is to understand that $1 buys different amounts of things in different parts of the state. Other factors may adjust for size and economy of scale. Hedonic Wage Index tries to capture wage differences based on the amenities offered by a certain geographic areas and the lack of amenities in others. This can account for differing average wages across the state. Colorado does adjust for personnel costs, but not for non personnel cost. Some states use separate indexes for supplies and materials or for utilities in addition to the personnel cost (i.e. wages, etc.).




Chair asked staff to distribute the ADM study from 2011 to committee members.



C&J discussed other district adjustments around economies of scale such as measuring minimum resources as is done in Montana or Wyoming. Colorado factors always increase the funding for districts based on size; i.e. there is no factor that equals 1, always equals 1+ (greater than one and therefore always increases the funding; every district gets an increase, not just the small ones that might need the adjustment to cover fixed costs).





11:09 AM -- Federal Resources



Chris Cross of C&J presented on Federal Program Funding and federal involvement with public education in Colorado. The discussion revolved around the people and issues that historically shaped the federal role in education since WWII. Primarily, federal involvement was less about education issues and more about national security, race and religion, poverty, transportation, but not specifically as a result of federal education policy; that occurred later with things like NCLB. Many of the programs that initiate from the federal government are a result of perceived failures of states to address certain social or national interest issues.



11:30 AM



Members of the committee asked questions of the consultants and discussed the issue of federal mandates (and funding or lack thereof) was discussed. Also discussed was federal funding involvement, specifically related to IDEA, where the federal law requires state actions but federal funding doesn't fully cover cost. In some cases, federal mandates changed into federal incentive programs (e.g., Race to the Top) which had dynamic impacts across education systems; maybe more than the federal mandates have. Committee had several questions and dialogued with consultants on federal funding issues; C&J gave a breakdown of the federal dollars in Colorado, about $700 million and about 8% of total school funding. This is spread across ESSA, IDEA, and PerkinsIV



11:50 AM



Committee continued with some discussion of the historical origins of federal dollars in education.





11:55 AM -- LUNCH



The committee did not recess for lunch





11:59 AM -- Committee Discussion: Subcommittees / Field Trips / Other



Stakeholder Engagement:




Rep Garnett discussed finding time on 12/13 and 12/14 to have "office hours" in which members of the committee and the consultants be available to engage stakeholders around school finance issues. The committee dialogued about this approach. Committee discussed possibly collecting stakeholder feedback from the interim committee website, if possible. Stakeholder have been reaching out directly to vendors and committee might prefer to have involvement in those conversations via a stakeholder engagement on the 13th and 14th, if available. Rep Buckner asked vendors to offer their perspective on how to best engage stakeholders in this process.



12:22 PM



Rep Garnett pledged to work with staff and members to set up a process to take in some of this outside feedback and engage stakeholders. The committee then moved to a discussion of subcommittee work. Rep Hamner suggested that state share / local share and related issues should be a subcommittee topic. Other members acknowledged this is the "elephant in the room"; That issue should be added to the agenda for the next meeting on Dec 15 and should be the first agenda item up on that hearing's agenda. Rep Leonard suggested a spending/expenditures/ cost-benefit might be another good subcommittee topic. He is interested in spending patterns specifically and would like to get at Cost Accounting at the district level. Rep Garnett suggested a subcommittee on taxation issues and constitutional issues. Rep Lundeen suggested a discussion on the marginal utility of the last dollar spent as a result of the increased responsibilities added to public schooling; i.e; Are we prioritizing the money spent intelligently to maximize the utility of that last dollar spent. Are state and federal mandates limiting the





marginal utility of that last dollar? Sen Zenzinger suggested a committee focused on equity. Rep Garnett pledged to work with the excused members to get their ideas about other subcommittee topice and how to best manage the mechanics of creating and convening these sub-groups.



12:38 PM



C&J suggested another subcommittee might want to address governance and accountability issues, which place the discussion of school finance into the larger context of school policy such that the finance act might better support or at least be rationally linked to this larger context.



12:47 PM



Committee discussed making more overt the values behind the current act and being specific about how Education has changed/ Are the values inherent in the existing act still the right ones/ valid, etc. That could be a subcommittee in itself;

Next meeting agenda items will include the statutory requirements of 1340 but added a conversation on state share and local share issues;





12:57 PM -- Concluding Thoughts



Adjourn