Peter to Paul? Politicians and educators are rolling up their sleeves to negotiate spending plan

May 1, 2002

Oak Park and River Forest High School District 200 in suburban Chicago spends about $13,600 a year on each student — nearly twice the average per-pupil spending in Illinois. And under a proposal in Gov. George Ryan’s fiscal year 2003 budget — which would take money from 22 categorical grants and redistribute it — that one-school district would get $1.3 million more each year.

Hundreds of miles south in Clinton County, Germantown Elementary District 60 spends less than $5,000 on each student per year. Yet under Ryan’s plan — designed to boost the foundation level or base amount the state pays toward the education of each Illinois student — that one-school district would lose about $47,000 a year, according to preliminary figures from the State Board of Education. Superintendent and Principal John Raymer says he’d have to fire two teachers or go without new textbooks for a few years.

“I think that’s kind of crazy,” he says. “We’ve been pitting schools against each other for years. Really, this is just more of that.” But Ryan, facing a deficit, wants to cut state spending across the board. 

He has proposed to lawmakers a $52.8 billion budget for the fiscal year beginning July 1. Under that plan, he would spend $6.1 billion on elementary and secondary schools, down from $6.2 billion in estimated spending for the current fiscal year. And the governor has proposed taking about $411 million in grant money that is now used to fund such programs as early childhood and bilingual education and redistributing it equally among students, upping the per-pupil spending foundation level and allowing schools to use the money as they please.

Through the existing grant program, some education money is earmarked in Springfield before it ever gets to schools. Ryan’s plan would remove some of those earmarks, which is a good plan in theory, says Ross Hodel, director of the Center for the study of Education Policy at Illinois State University in Normal. But, he says, “The bottom line is, if you’re not adding money to the entire budget, it’s very difficult” to pass any program. 

The only way to meaningfully improve the way the state funds schools is to spend more money, say some school finance experts. “You cannot shuffle money,” says Robert Leininger, former state schools superintendent and chair of the state’s Education Funding Advisory Board. “You cannot rob Peter to pay Paul.” 

Figures from the State Board of Education produced weeks after Ryan announced his proposal showed Chicago and other Cook County schools would lose, as well as downstate schools. The only region that would stand to gain are the majority of districts in the predominantly affluent collar counties surrounding Chicago. 

While the foundation level would jump from $4,560 to almost $5,000 per student, Illinois schools would get $40 million to $50 million less — and money that will have to be used to make up a shortage in the Teachers’ Retirement System pushes the loss up to $165 million, according to the Bureau of the Budget. 

“You never want there to be any losers, but the reality is, everyone’s a loser this year,” says Hazel Loucks, Ryan’s deputy governor for education. “It’s just that there are so few dollars, and somebody had to come up with a solution.” 

Loucks notes that Ryan’s solution gives schools spending flexibility and saves $28 million in bureaucratic costs. Schools can use the general state aid money to continue funding the grant programs they consider most necessary.

“Local control is what they’re always hollering about,” she says. “And this would give them more local control.”

The Illinois Education Association supports the plan for precisely that reason. “What we see is an opportunity for educators and not bureaucrats to make a decision how local money is spent,” media relations director Charles McBarron says. 

But some educators argue that, instead of flexibility, loss of targeted grant dollars would simply tie their hands. Many of the grant programs are still mandated, they say, even without funding. The governor’s office, though, contends that if the plan passes, bills repealing the grant requirements also will be passed. 

“This is the first step in a long process of negotiations and counter proposals,” says Colleen Atterbury, the Bureau of the Budget’s division chief for education. If local districts have less to spend, they should have more power to decide how to spend it, she says. 

Schools that lose money overall, though, might be forced to drop the grant programs in favor of funding basic costs. “School districts are not going to go and implement those programs on their own. It’s just not going to happen,” says Rep. Julie Curry, a Democrat from Mt. Zion who opposes the proposal.

In fact, the loss of specific grant funding for some programs drew such vocal criticism that Ryan responded in March by saying he now wants to preserve grant funding in three areas: early childhood, agricultural career and technical education.

The early childhood education program, for instance, aims to give a boost to more than 55,000 pre-schoolers who have shown signs they would struggle in school.

The realization that some critical programs may not be implemented without specific dollars attached is one reason Ryan decided to save the three grants, Loucks says. 

As lawmakers wrangle with next year’s budget, no one knows what parts — if any — of Ryan’s education proposal will remain intact. But the three grants Ryan decided to take off the chopping block total about $240 million — more than half of the original amount he intended cutting from categorical grants. 

And that will require some recalculation. Every $100 added to the foundation level costs the state about $135 million to $140 million, says Bill Hinrichs, state board senior policy adviser. So removing the trio of grants from the table would probably knock the proposed $5,000 foundation level down by $150, Hinrichs says, putting it at $4,850. But if cuts are made elsewhere, the foundation level could stay at $5,000, as Ryan initially proposed.

All parties agree the end product will not be what Ryan initially proposed. As a result, educators are rolling up their sleeves and negotiating. “We are picking and choosing line items right now. We know we can’t fund everything this year — it’s impossible,” says Ben Schwarm, director of governmental relations for the Illinois Association of School Boards. “Will it be exactly what the House has out there? No. Will it be exactly what the governor said? No. But I think it’s going to be a hybrid of all of those.”

The House Education Appropriations Committee, which Rep. Curry chairs, has a counter proposal that keeps most of the major grants, including early childhood and bilingual education, in place and raises the foundation level by $120. 

To increase the state’s share of the cost of educating its students and shrink the spending gap among districts was a goal of Ryan’s predecessor. Former Gov. Jim Edgar created a plan that raised the foundation level for three consecutive years. That plan took the level to $4,425 in the 2000-2001 school year before expiring. Ryan boosted it further, bringing it to the current level of $4,560. 

This fall, the Education Funding Advisory Board plans to release a proposal, which Leininger says would dramatically alter the way schools are funded and would raise taxes. He concedes the proposal is unlikely to be politically feasible. 

The challenge, as always, will be to strike a balance between the districts that win and the districts that lose. That balance is absent from Ryan’s proposal to boost the foundation level through the elimination of grants, critics say.

The plan is “a serious, serious hit to our schools” because it makes schools enemies and doesn’t put students’ interests first, says Donna Baiocchi, director of Education, Research, Development, a group that represents Cook, Lake and DuPage counties. Though Lake is one of the xollar counties that would gain money under the plan, she says, “It shouldn’t be about community versus community.”

But the reality of limited funding remains and is something that the leaders of the less well-healed school districts can understand.

“Something is going to have to give,” Raymer says. “We don’t like it, but we understand it.”


Kristy Eckert is a graduate student in the Public Affairs Reporting Program at the University of Illinois at Springfield.

Illinois Issues, May 2002