Billions Served

On Wednesday, a legislative conference committee re-wrote a budget proposal for the 2010 K-12 School Aid Fund in such a way that it would reduce the foundation allowance by $218 per student. If enacted, this will yield a total School Aid Fund savings of $346.4 million. The idea of cutting this much from the school budget was swiftly criticized by the governor's budget director, Bob Emerson, who predicted "mass layoffs" because under this proposal the "School Aid Fund isn't adequately funded."

This is a harsh and scary prediction. In the current Lansing environment, a Democratic House Speaker and Republican Senate Majority Leader are each talking as if they will join together and send the Democratic governor several budgets with more cost containment than she wants. One could easily read Mr. Emerson's words as a deliberate effort to foil the budget plans of the legislative leaders.

But that's a subjective reading. To get an objective take on what's going on, you need to get a handle on what is "adequate" funding for K-12 schools. One way to do that is to consider the most recent rankings of education cost inputs from the American Legislative Exchange Council, using data from the U.S. Department of Education.

According to ALEC, the average teacher salary in the United States for 2006-2007 was $46,593. Michigan has the 4th highest paid teachers on the list, with an average salary of $58,482. By comparison, the state of Washington is ranked 22nd and is representative of a state that was paying teachers closer to the national average: $46,326. 

So, if Michigan pays $12,156 more than Washington for each of its teachers, it stands to reason that if we had made the policy choice to hire our teachers just at Washington's rather typical wage rates, we'd get a savings of something like that $12,156 for each one, every year.

ALEC reports that Michigan had 109,946 public school teachers during 2006-2007. What if Michigan had decided to pay all those teachers at the Washington rate for that year?

Run the math: $12,156 annual extra pay per teacher, multiplied by 109,946 Michigan teachers = $1.34 billion more spent by Michigan taxpayers just that one year for essentially the exact same public service. The proposed reduction of $346.4 million being bandied about by the Legislature right now is roughly one-fourth of that. 

Rather modest by comparison, no?

A few more ways to look at this:

1. TOTAL school aid state spending for FY 2007 was just under $12.7 billion. So just paying each of our teachers about $12k more than an average spending state like Washington accounts for more than 10 percent of our school aid spending.

2. The House Fiscal Agency reports 1.68 million public school students in FY 2007. Divide the $1.34 billion by 1.68 million kids and you get a $798 per pupil "surcharge" against Michigan taxpayers simply because of a policy decision by our school districts to pay so much more per teacher than an average spending state like Washington. 

3. Using Washington might be a conservative estimate of what is possible. Try all the math above with states like Texas ($41,744 annually per teacher) and Florida ($43,302) that pay less than the national average.

There seems to be a plausible case to be made that funding for public schools in Michigan has been more than "adequate."

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