INFORMATIONAL MEETING

 

TAPE 17-18, A-B

 

HOUSE REVENUE COMMITTEE

JANUARY 27, 2003   8:30 AM   STATE CAPITOL BUILDING

 

Members Present:                        Representative Lane Shetterly, Chair

                                                Representative Wayne Scott, Vice Chair

                                                Representative Joanne Verger, Vice Chair

                                                Representative Phil Barnhart

                                                Representative Vicki Berger

                                                Representative Pat Farr

                                                Representative Elaine Hopson

                                                Representative Max Williams

 

Members Excused:                      Representative Mark Hass

 

Invited Testimony                     John Topagna, ECONorthwest

                                                John Marshall, Oregon School Boards Association

 

Staff Present:                            Paul Warner, Legislative Revenue Office

                                                Kathy Tooley, Committee Assistant

 

TAPE 17, SIDE A

 

004

Chair Shetterly

Calls meeting to order at 8:35 a.m.

 

 

012

John Marshall

Oregon School Boards Association retained the services of ECONorthwest, an economic consulting firm to prepare a study on school district spending. ECONorthwest was charged with three areas of review:

 

·         Look at national studies that compare Oregon school district spending with other states, to understand why numbers are different.

·         Look at Oregon School District spending since Measure 5 passed and answer the question, where has the money gone?

·         Look at 16 sample school districts, selected based on geographic diversity, size of school district and districts that fared differently under Measure 5 and the equalization that followed.

 

038

John Topagna

Presented program, beginning with “Comprehensive Analysis of K-12 Education Finance in Oregon”, ECONorthwest, (Exhibit 1).

 

Originated from April 2002 Oregonian article, which reported spending per student in Oregon was higher than the national average in 2001 according to the National Center on Education Statistics.  Spending in Oregon was said to be higher than California, Washington, and Idaho, and looking back 10 years the same conclusion was reached.  However, reports at the time were that school funding had not kept pace with inflation and that there was a school funding crisis due to underfunding.  Provided Committee with points of discussion when listening to testimony regarding per student expenditures.

 

052

Topagna

Gave the Committee an overview on spending per student in Oregon, how is it calculated and how is it changed?  (Page 2-1, Exhibit 1).  Explained to the Committee that there are multiple measures to define spending, as well as multiple measures for defining students.  The conclusion is that people mix and match those figures without defining information that is being given, which is why there are different answers.  There are three major definitions most frequently reported:

·       Amount of money generated through the formula.

·       Total amount that keeps the schools running on a day-to-day basis.

·       Total expenditures which include operations expenditures plus capital outlays to maintain buildings.

 

Questions and discussion interspersed regarding definition of enrollment.

 

370

Topagna

Urged Committee as policy makers, when hearing testimony, to understand what the system of measurement is, and has it been consistent over time?

 

 

TAPE 18, SIDE A

 

022

 

 

 

 

 

 

 

 

 

 

 

120

 

 

Topagna

 

 

 

 

 

 

 

 

 

 

 

Topagna

Question, Has spending kept pace with inflation?  Four different measures of inflation:

·         Consumer Price Index for Urban Consumers, increase of 30% over decade.

·         US Bureau of Labor Statistics calculates a CPI for Portland-Salem area, shows an increase of 36% over decade.

·         What has happened to average wages per job of other laborers in Oregon, increased 54.4%.

·         Final statistic developed by US Bureau of Labor Statistics is, what is the growth in private school elementary and high school tuition and fees, 88.4%.

 

Another example is that per student spending measures can be defined in a number of ways and levels of growth depending upon definition used.

 

Questions and discussion interspersed.

 

178

Topagna

Addressed the second question, “How does Oregon’s per student spending compare to that of other states”. Can you compare and how do you and what are the caveats? (Page 2-7, Exhibit 1).

 

Questions and discussion interspersed.

 

 

TAPE 17, SIDE B

 

042

Marshall

Advised the Committee on reporting background, Oregon mandated to school districts a uniform chart of accounts.  The Department of Education has ensured objects and functions are uniform. Comparison of district vs. district is more consistent than national level.

 

Questions and discussion interspersed.

 

029

Topagna

Addressed final aspect of study regarding 16 district case studies, ranging in size, urban and rural, strong and weak local revenue bases pre and post Measure 5.  (Page 4-1, Exhibit 1).

 

Questions and discussion interspersed.

 

293

Topagna

Overall conclusions of the study:

·         Single statewide spending estimates will miss important complexities – equalization process, and changes in spending on regular vs. special instruction.

·         Oregon’s spending per student trended toward the U.S. average, but remained above trend in 2000-2001.

·         Oregon’s spending per student on employee benefits is above the national average and levels in neighboring states.

·         Oregon shows higher spending on purchased services and other support services.

 

Questions and discussion interspersed.

 

351

Marshall

Performed a survey of counterparts in other states asking, “What is the mandatory contribution that school districts in your state make toward employee retirement?  Oregon at 12.3%, was higher than every state with the exception of Michigan and Ohio.  Employer contributions in many states are made at the state level rather than as school district expenditures.

 

Questions and discussion interspersed.

 

 

TAPE 18, SIDE B

 

 

074

Marshall

Hoped the Committee, as it discusses the distribution formula, will use information from the Department of Education. The department has made a significant investment in the data base initiative project and provide information by school and school district on a variety of spending

 

095

Chair Shetterly

Meeting adjourned at 10:01 a.m.

 

 

 

 

 

 

Tape Log Submitted by,

 

 

 

Kathy Tooley, Committee Assistant Reviewed by Kim Taylor James

 

Exhibit Summary:

1. Topagna, Comprehensive Analysis of K-12 Education Finance in Oregon, 58 pages.