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Oregon Department of Education (ODE)

State School Fund

Ways & Means Education Sub-Committee

March 24, 2003

Pat Burk,Deputy Superintendent

Brian Reeder,Analyst, School Finance

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Agenda

State School Fund

State Education Goals

How School Districts Spend their Money

How our Schools Perform

What Outcomes can be Expected

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To Meet Oregon’s Education Goals

And ODE’s Prioritized Mission

“…shall provide by law for the establishment of a uniform, and

general system of Common schools…” Article VIII, Section

3, Oregon Constitution

“…the best educated citizens in the nation and the world.”

“Access to a Quality Education must be provided for all of

Oregon’s youth…” ORS 329.035

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Teaching: 540,000 Students

Employing: 35,000 Teachers & Assistants 18,600 Support Staff District Administrators and Support Staff 2,600 Principals and Assistants 1,600 School Support Staff (Clerical, etc) 3,600 Counselors 1,200 Librarians 600 Student Support Staff 1,200 Other (Maintenance, custodial, etc.) 8,400

TOTAL Support Staff 18,600

Operating: 1,250 Schools

198 School Districts

21 Education Service Districts

K-12 Dollars Pay For:

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Oregon’s K-12 System

High academic standards with clear expectations for student performance

A system of statewide assessments aligned with the standards

Use of data to drive school improvement and accountability

Assessments at grades 3, 5, 8, and 10

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State Standards and Assessments

Oregon Report Card

Database Initiative provides detailed information

on how schools spend resources

Fiscal Audits

Federal ‘No Child Left Behind Act’

Oregon’s Accountability Tools

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State School Funding 1991 -- 2005

State and Local Revenue

$0.0

$2.0

$4.0

$6.0

$8.0

1991-93 1993-95 1995-97 1997-99 1999-01 2001-03 2003-05

Bill

ion

s

State

Local

$5.0 $5.1 $5.3

$5.9$6.5

$6.8$7.3

$1.9

$3.1

$2.6

$2.5

$3.5

$1.8

$4.2

$1.7

$4.5

$2.0

$4.7

$2.1

$5.0

$2.3

As of Special Session 6

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Revenue Trends

Why?

- Decrease in local revenues

- Inflation (Personnel, Salaries, Benefits)

- Increases in student enrollment

State School Fund Revenues have increasedbut real Revenues Per Student have declined

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Funding Per Student

Inflation-Adjusted Oregon K-12 School FundingState Formula Allocation per ADMr

in Year 2002-03 Dollars

$6,525$6,676

$6,157 $6,185$6,021

$5,886$6,128 $6,079

$6,303 $6,332$6,451

$6,126$6,264

$6,033

$6,778

$0

$1,000

$2,000

$3,000

$4,000

$5,000

$6,000

$7,000

$8,000

1990-91 1991-92 1992-93 1993-94 1994-95 1995-96 1996-97 1997-98 1998-99 1999-00 2000-01 2001-02 2002-03 2003-04 2004-05

Year

Ye

ar

20

00

-01

Do

llars

2002-03 amount includes $378 per ADMr for Accrual

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Funding Per Student

Inflation-Adjusted Oregon K-12 School FundingState Formula Allocation per ADMw

in Year 2002-03 Dollars

$5,651 $5,744

$5,235 $5,221$5,079

$4,945$5,096 $5,028

$5,182 $5,187 $5,261

$4,988 $5,065

$4,854

$5,874

$0

$1,000

$2,000

$3,000

$4,000

$5,000

$6,000

$7,000

1990-91 1991-92 1992-93 1993-94 1994-95 1995-96 1996-97 1997-98 1998-99 1999-00 2000-01 2001-02 2002-03 2003-04 2004-05

Year

Ye

ar

20

00

-01

Do

lla

rs

2002-03 amount includes $309 per ADMr for Accrual

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School District Cost Increases

Major Cost Drivers:

PERS and Health Care Cost Increases

Declining Enrollment in Some Districts

Changes in Student Demographics

Special Education Enrollment

English Language Learners

Maintaining and operating aging school buildings

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198 School Districts 2002-03

Rapid Growth10%

Declining65%

Stable25%

School Districts by Change in Enrollment

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Demographic Changes

Growth in Student Enrollments1992-93 to 2001-02

286%

29%

8%0%

50%

100%

150%

200%

250%

300%

350%

ESL Special Ed ADMr

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Spending per Student*– 2000-01

“Instruction” (NCES Category)

Direct Classroom Spending for:

Teachers and Instructional Assistants 52.4%

Classroom Supplies and Textbooks 3.1%

Professional and technical services 3.0%(typically teachers or assistants hired to deliver specific

instructional programs)

Other – Fees and tuition .7%

TOTAL (just below national average) 59.2%

* Per Secretary of State K-12 Audit

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Spending per Student*– 2000-01

“Support Services” (NCES Category)

Includes:Special Education Services, Counselors, Health 6.0%

Libraries, Curriculum & Instruction Improvement 4.6%

School Level Administration (Principals & Support Staff) 6.4%

District Level Administration 1.7%

Business Services (Human Resources, Technology, etc) 5.7%

Building Maintenance and Operations 8.6%

Transportation 4.2%

TOTAL 37.2%

* Per Secretary of State K-12 Audit

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“Non-Instruction” (NCES Category)

Includes:

Food Services 3.3%School stores, enterprises .3%TOTAL 3.6%

* Per Secretary of State K-12 Audit

Spending per Student*– 2000-01

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A Decade of Progress

1992-2002

The focus on high standards is paying off -

Strong progress on state assessments

Declining dropout rates

High SAT and ACT scores

High percentage of college-bound students

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We Have Made Significant Progress

Percent of Students Meeting State Benchmarks1995-96 and 2001-02

0% 10% 20% 30% 40% 50% 60% 70% 80% 90%

3rd Grade Reading

3rd Grade Math

5th Grade Reading

5th Grade Math

8th Grade Reading

8th Grade Math

10th Grade Reading

10th Grade Math

1995-962001-02

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Additional Quality Education Indicators

1995-96 and 2001-02

Dropout Rate

SAT Math

SAT Verbal

ACT

% College Bound

1995-962001-02

47.1%

46.6%

23.6%

22.5%

523

526

521

526

7.2%

4.9%

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But we have not yet met our goals

Many students are not reaching the high standards necessary for them to succeed in the 21st century

Significant Achievement Gaps exist in performance of Hispanic and African American students and students in poverty

Student dropout rates are still too high

Paperwork takes time away from teaching

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2001-03 Budget

State School Fund Reductions from Close of Session(Millions of Dollars)

Cuts thru 5th Special Session* $ 149.7

December Reductions 46.2

Measure 28 failure 95.0

MUPL Shortfall** 8.3

TOTAL State Reductions $ 299.2 -5.7%*Includes Special Session 5 reduction of $132 Million plus common school fund adjustment of $17.7 Million. Does not include $211 Million accrual adjustment.

**Medicare Upper Payment Limit (MUPL) Revenue Shortfall is an estimate from DAS

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2002-03 State School Fund

Reductions in Funding per Student

Close of Session Estimate $ 5,502 per ADMw

Current Estimate $ 4,988

Reduction $ 514 -9.3%

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2003-05 Budget

State School Fund – in millions

Without Cuts* GBB CutState Funding 6,010 5,050 960

Local Revenues 2,269 2,269 0

Total $8,279 $7,319 $ 960

* Based on expected level of spending in 2001-03 before cuts made

necessary by revenue shortfalls.

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2003-05 Governor’s Balanced Budget

• Proposed 2004-05 SSF amt per ADMw is 17.4% below 1990-91, inflation adjusted

• 1990-91 $ 5,874 per ADMw

• 2004-05 $ 4,854 per ADMw

Based on 2003 dollars

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Quality Education Commission

Student Performance Expectations Using Best Practices and Full Funding

90% of all students would reach reading and

math benchmarks in this decade

Elementary by 2005

Middle School by 2008

High School by 2012

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Governor’s Assumptions

No cost of living or step increases for teachers—saves $257 million No salary increases for school-level administrative staff—saves $15 million No wage increases for school-level classified staff—saves $23 million No increase for district-level administration and services—saves $34 million No increase in health insurance or other benefits costs—saves $144 million No increase in costs for supplies and services—saves $86 million

Total Savings = $559 million

Add-back to maintain school days = $100 million

Net Savings = $459 million

2003-05 Governor’s Budget - $5.05 Billion

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2003-05 Governor’s Budget - $5.05 Billion

Example of Program Impacts

Reduce central administration and business services by 15%

Reduce school-level administration by 15%

Eliminate:

- 1.0 elementary specialists per school—total of 750 statewide

- 2.0 middle school teachers per school—total of 520 statewide

- 4.5 high school teachers per school—total of 770 statewide

Increase:

- Average middle school class size from 23 to 25 students

- Average high school class size from 24 to 27 students

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Cuts Beyond Governor’s Assumed Savings of $459 million

Reduce central administration and business services by 10%

Reduce school-level administration by 10%

Eliminate:

- 1.0 elementary specialists per school—total of 750 statewide

- 2.0 middle school teachers per school—total of 520 statewide

- 4.0 high school teachers per school—total of 685 statewide

Increase:

- Average middle school class size from 23 to 25 students

- Average high school class size from 24 to 26 students

2003-05 Alternative Budget - $4.66 Billion

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Cuts Beyond Governor’s Assumed Savings of $459 million

Reduce central administration and business services by 10%

Reduce school-level administration by 10%

Eliminate:

- 1.0 elementary specialists per school—total of 750 statewide

- 2.0 middle school teachers per school—total of 520 statewide

- 5.0 high school teachers per school—total of 850 statewide

Increase:

- Average middle school class size from 23 to 25 students

- Average high school class size from 24 to 27 students

2003-05 Alternative Budget - $4.64 Billion

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Questions and Discussion

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