Future of Educational Finance

Grand Canyon University: EDA-535

October 1, 2014

Gary Marx stated “identifying, monitoring and considering the implications of trends is one of the most basic processes for creating the future” (Stevenson, 2010 p. 1). The world of education is forever changing at a pace that gets more rapid as the years go on. The decisions made in the past have laid the foundation of education today, as will recent changes affect the future. Programs such as choice schooling and No Child Left Behind will impact school funding. Rulings such as the Lemon Test and separation of church and state will impact decisions that can potentially result in litigation and court rulings dictating educational decisions. In his work regarding educational trends, Kenneth Stevenson (2010) stated, “a continuing recession, escalating political polarization, rising racial/ethnic tensions, a growing national debt, and a widening divide between the haves and the have nots portend a future fraught with unprecedented challenges to and clashes over the form and substance of public education in America” (p.1).

Analysis of the Lemon Test
The Lemon Test was created by Chief Justice Warren Berger as a result of the court case Lemon v. Kurtzman (1971) and is based on the principles stated in Everson v. Board of Education. The case of Lemon v. Kurtzman (1971) centered on Rhode Island’s Salary Supplement Act. This act approved a salary supplement of up to fifteen percent for teachers who taught secular subjects in private religious schools or non-public elementary schools. The courts determined that approximately twenty-five percent of Rhode Island’s students attended non-public schools. Furthermore, ninety-five percent of the parochial schools were Roman Catholic. Pennsylvania offered a similar program that reimbursed non-public schools for expenses related to secular education and required schools to account for the expenses separately. Approximately twenty percent of Pennsylvania’s children attended non-public schools and ninety-six percent of the schools had a religious affiliation. The high courts looked at its own precedents and determined that, in order for a law to be in compliance with the Establishment clause it, “must have a secular legislative purpose; second, its principal or primary effect must be one that neither advances nor inhibits religion; finally, the statute must not foster "an excessive government entanglement with religion" (Barnes, 2010, p. 2-3). The Lemon test was created to, “determine when a law has the effect of establishing religion” (The Basics, 2014, p. 3). The court applied the Lemon test to the Pennsylvania and Rhode Island supplemental funding programs and deemed that the programs in both states were unconstitutional (The Lemon Test, 2009). Both programs met the first requirement of the Lemon test as they had a secular purpose. However, the court determined that it was unclear if the programs met the second set of criteria as “while the aid was intended for secular use, it was not entirely secular in effect” (The Lemon Test, 2009, p. 1). The court decided that it did not need to establish if the programs met the second part of the Lemon test as they failed to meet the third criterion as both programs “excessively entangling state administrators with the operations of parochial schools” (The Lemon Test, 2009, p. 1). The Lemon test has
“become an extremely influential legal doctrine, governing not only cases involving government funding of religious institutions but also cases in which the government promoted religious messages. Over the years, however, many justices have criticized the test because the court has often applied it to require a strict separation between church and state” (The Lemon Test, 2009, p. 1).
The test has been the foundation for many of the court’s ruling regarding the establishment clause since 1971.

The "choice"
The idea of vouchers for education was first introduced in early 1950 in a move to privatize education. In that same year, as a result of Brown v. Board of Education, the southern states put the first voucher program into action as a way to “enable white students of all income levels to attend the segregation academies and continue receiving a publicly-funded, all white education” (Save our Schools NJ, 2014). In 1989, Wisconsin’s more modern voucher programs, focused on poor children of all races. (Save our Schools NJ, 2014). Regardless of the nature of the voucher program, the impact is the same- taxpayer funds being diverted from public school funding.
In 2002, the Supreme Court ruling of the case of Zelman V. Simmons-Harris stated that it was not a violation of the Establishment Clause to provide scholarships for some students to attend private or parochial schools. This ruling had a subsequent impact on the development of S1872, also known as the Opportunity Scholarship Act. This act allowed for vouchers to go to private or religious schools. Changes from S1872 resulted in an almost $1 billion dollar revenue loss for school funding by the end of its fifth year (NJEA, 2011). In addition to the government revenue lost, a 100% tax credit is given to companies who donate to these funds thus losing additional revenue. The children given these scholarship vouchers are children from targeted failing school areas, which then result in that already failing district to lose additional weighted funding for those children.
“Shifting a handful of students from a public school into private schools will not decrease what the public school must pay for teachers and facilities, but funding for those costs will decrease as students leave” (NCSL, 2014). A study by the American Federation of Teachers in 2011 looked at the revenue lost in several states as a result of money being diverted to voucher programs. In most cases, these programs obtained funding by either increasing taxes or by reducing state aid to local school districts. Both the Milwaukee Parental Choice Program and the Cleveland Scholarship and Tutoring Program did just that. The Milwaukee program, in 2009, cost taxpayers roughly $130 million and the Cleveland program reduced Disadvantaged Pupil Impact Aid to the Cleveland public schools by $11,901,887 in 2007 (American Federation of Teachers, 2011).
One of the most significant issues with voucher programs is the fact that they do not have the same monitoring and regulations as public schools in order to obtain funding. “Perhaps the biggest critique of market-based reforms, such as school choice and performance based accountability is that they will further exacerbate inequalities in education” (Fusarelli and Young, 2011, p. 92). Not all program funding is distributed in the programs based on poverty. Parents of special education students are not guaranteed special education services. In addition, many programs are not monitored for the way they appropriate money. When a review of the Arizona tax credit programs was conducted, it was discovered that “almost two-thirds of all voucher organizations kept more funds for overhead than allowed under state law” (AFT, 2011, p. 7). Per student revenue that local districts lose to these programs is not guaranteed to be 100% applied to the students attending the private school.
In 2011, the U.S. Department of Education had a budget cut of $5 billion. (The Education Trust, n.d.). In 2013-2014, over 35 states are providing less funding per students, more than 10% in fourteen of them. (Leachman & Mai, 2014). With decreasing numbers such as these, voucher programs only continue to threaten to take limited funding away from local districts. Continued funding cuts will have an impact on the economic future of our country. As stated by Brimley et al. "the more education provided, the more wealth developed; the more wealth created, the more funds available for investment; the more investment undertaken, the more wealth available for investment in physical and human capital: (Brimley et al., 2012, p. 3).
The impact of No Child Left Behind (NCLB)
The No Child Left Behind Act of 2001 (NCLB) is the largest federal funding program in the history of the United States. No Child Left Behind is a, “reauthorization of the Elementary and Secondary Education Act (ESEA), which originated in 1965 as part of the War on Poverty” (Braden and Schroeder, n.d., p. 1). While NCLB provides additional funding from the federal government it also imposes mandates that states must follow. The supplementary funding provided under the No Child Left Behind Act is not necessarily enough for states to meet the standards required by the act. The main focus of NCLB is Title I funding which the federal government allocates to states to help provide an education to economically disadvantaged students. No Child Left Behind includes eight other forms of Title funding such as school safety, teacher quality, assessments, and American Indian education (Braden and Schroeder, n.d., p. 1). Title I funds are the most important part of No Child Left Behind as the majority of the funds are earmarked for Title I purposes and Title I funding holds states accountable for student achievement as evidenced on state assessments.
The move towards holding states accountable for student achievement began prior to the No Child Left Behind Act of 2001. Most states included accountability in their education reform acts during the 1990s (Ladd, 2001). By the year 2001, the same year as NCLB, more than forty states published a school report card, more than half had some type of school achievement rating, and numerous states offered assistance or sanctions to schools with low student performance (Meyer, Orlofsky, Skinner, & Spicer, 2002). In January of 2002, No Child Left Behind was signed into law and for the first time in history the federal government was involved in, “setting broad parameters, implementation timelines, and sanctions for state accountability systems” (Duncombe, Lukemeyer, &Yinger, 2006, p. 1). States began to implement NCLB in 2002 during a time of financial difficulties. This created concerns based on the cost involved in funding a program of its magnitude as well as questions regarding the extent to which the NCLB program was funded. Most estimates concerning the cost of implementing the program were far from accurate. This prompted states, such as Connecticut and Utah, to pass legislation which allowed them to either ignore the parts of NCLB that required funding from the state or sue the federal government for a lack of funding (Duncombe et al., 2006).
While NCLB involves many federal education programs, the act’s requirements in regards to school improvement, accountability, and testing are a priority. No Child Left Behind required states to test students in grades three through eight yearly in math and reading. Students in grades ten through twelve must be tested once. In addition students must be tested in science once in grades three through five, six through eight, and tenth-twelfth. In addition, states, school districts and individual schools are to “publicly report test results in the aggregate and for specific student subgroups, including low-income students, students with disabilities, English language learners, and major racial and ethnic groups” (New America Foundation, 2014).
Another requirement of NCLB is that all teachers must be highly qualified. Teachers must pass a licensure exam and be certified by the state they teach in. Teachers who teach a specific subject area must demonstrate their subject knowledge by passing the subject knowledge portion of the licensure exam. NCLB specifies that states develop a plan “to ensure that low-income and minority students are not taught by teachers who are not highly qualified at higher rates than are non-minority and low-income students” (New America Foundation, 2014). In addition, NCLB give parents and guardians the right to know the qualification of their child’s teacher and if their child is receiving instruction from a paraprofessional and if so the qualifications of that individual. NCLB requires that school district’s notify parents in writing if their child will receive instruction from a teacher who is not highly qualified for longer than four weeks (New America Foundation, 2014).
No Child Left Behind stated that all school districts in the United States were to guarantee that each child enrolled in their district would score proficient in the state’s reading and math assessments by 2014. Each state was given the freedom to define what grade level proficiency meant in regards to their state standards. NCLB required that schools make “adequate yearly progress” (AYP) towards achieving their goal. Proficiency rates increased yearly up to 2014 and individual states were allowed to choose their rate of increase. In order for a state to make AYP they must meet their goal for student achievement in reading and math every year (New America Foundation, 2014).
Forty-three states, Washington D.C., Puerto Rico, a group of California school districts as well as the Bureau of Indian Education applied for waivers exempting them from being required to meet their targets and other requirements of NCLB from the Department of Education. In September of 2011, President Obama and Arne Duncan, Secretary of Education, announced that the Obama administration, “would allow states to request flexibility in meeting some of the requirements under NCLB in the absence of the law’s reauthorization” (New America Foundation, 2014). For a state to qualify to receive flexibility through a waiver, the state needs to show they have adopted or will implement reforms to their, “academic standards, student assessments, and accountability systems for schools and educators” (New America Foundation, 2014).
According to No Child Left Behind schools that do not make AYP for two consecutive years will be identified for school improvement, and will have to create a school improvement plan (SIP), and apply a minimum of ten percent of their federal Title I funds to professional development. Schools that do not make AYP for a third year will be under corrective action, and will be required to apply interventions to improve school performance, “ from a list specified in the legislation” (New America Foundation, 2014). If a school fails to make AYP for a fourth year they will be, “identified for restructuring which requires more significant interventions” (New America Foundation, 2014). If a school fails to make AYP for a fifth year, “they must implement a restructuring plan that includes reconstituting school staff and/or leadership, changing the school’s governance arrangement, converting the school to a charter, turning it over to a private management company, or some other major change” (New America Foundation, 2014). Specific school districts that have a high percentage of schools that fail to make average yearly progress for multiple years could be, “identified for school improvement, corrective action, and restructuring” (New America Foundation, 2014).
The Future of Church-State Relations
As religion continues to hold influence on the American culture the U.S. judicial system remains the authority for interpreting the constitutionality of matters of religion. The separation of church and state comes as a result of America not having an established religion for all of the residents to follow; the people were given freedom of religion. According to Thomas Jefferson, God is acknowledged as the creator of mankind and government is not a divine organization therefore it is the responsibility of the citizens to oversee the institution of government. In 1791 the government discontinued support or promotion of any religion. The decisions made so long ago continue to greatly impact organizations such as schools today. In the classroom teachers are held accountable to the state that they will remain neutral on the subject of religion while on school grounds (The Boisi Center, n.d.). Cases such as Committee for Public Education and Religious Liberty v Nyquist (1973) and Mueller v Allen (1983) have kept the courts busy on the subject of funding religion in the educational system (Pew Research Center, 2008). The Free Exercise Clause permits students to practice their faith privately on campus as long as it does not cause disruptions to the academic day and students are not being persuaded to follow his/her beliefs. School vouchers and tax credits that were distributed from 1983-2002 were considered constitutional under the Establishment Clause as they approved a parent’s choice to have their child attend a religious school. The courts accepted these practices because they did not show intent to persuade on the side of religion (The Boisi Center, n.d.). During this time all over the country courts were hearing cases to oppose the allowance of vouchers to religious organizations as they felt it went against the separation of church-state. In some states courts ruled that vouchers could only be used for parents that wanted to move their child to a higher performing public school so that private religious schools did not receive state education funds. Now and in the future the United States will continue to permit religious liberty to the people, the government will not be accountable nor will it dictate ones religious practices (The Boisi Center, n.d.). With the increased cases that continue to build against religion in schools and educational funding to religious private schools it is predicted that the future of church-state relations in educational funding will give more authority to the state education departments on the placement of funds. The state will seek more control of religious private schools, as the voucher program seems to be here to stay. The state is going to want more control of curriculum if they will be providing financial support (Pardini, 1999). Tax credit programs are also popular and seem to offer a compromise of church-state relations. Tax credits provide financial support to families that choose to place their child in private schools. As time progresses state government will advocate for an increase in charter schools, this will allow for state funds in the form of vouchers and tax credits to support schools that do not have a religious focus (Pardini, 1999). This battle will continue until a decision is made by the U.S. Supreme Court on the constitutionality of the Blaine Amendments. These amendments were established in 1875 to disallow states to financially support private schools that teach religion. At this time there are approximately thirty states that incorporate Blaine language in their constitution, which disrupts the success of vouchers being used by parents that wish to relocate their child to a higher performing and/or religious private school (DeForrest, 2003).
Future Trends in Court Decisions and Power over Educational Financing The courts have had a hand in education dating back to the creation of the United States Constitution. Although there was no specific mention in the Constitution as to who was responsible, who carried the power in terms of financing education, education was valued in the early days, and many early settlers used the Bible to teach the young to read. As time went on people challenged the use of teaching the Bible in Public Schools. People used the First Amendment of the United States Constitution to argue about the intermingling of church and state and the use of direct government support for parochial, and private schools (Brimley, Verstegen, & Garfield, 2012). The courts found themselves hearing cases of people challenging the use of government funds in schools other than public schools and, in the case of Pierce v. Society of Sisters (268 U.S. 510-1925), the courts ruled for using public funds for church-related schools. Because of this ruling financing public schools has seen some great changes, and will continue to see changes. This court ruling could potentially change the makeup and the system of education in the United States. States will implement more stringent guidelines as to what they expect from schools in regards to performance standards since they are the ones providing the funds. These guidelines are the result of schools continuing to fail to meet state requirements, running low on funds due decreased income from property taxes, or the need for states take over more schools or shut them down, To date there has not been a proven method that will solve the problems of educational financing. Politics have a large influence in financing education. This was evident during the Bush administration, when money went into funding Laura Bush’s library after other school programs were cut. For nearly forty years the constitutionality of the way schools are financed has been scrutinized. There have been one hundred thirty-nine lawsuits in forty-five states promoting finance reform after the ruling of Serrano v. Priest (Education Next, 2010). The states are required by their individual state constitutions to provide an adequate education to all students. Currently there is no solution to the challenges of financing public schools so that all individuals feel like they are being treated equally. The debates and challenges have been going on for decades and will continue for years to come. Responsibility is placed on the states to ensure that their State Constitution requirements are being met and to provide funding for local schools.

Conclusion As previously stated education as it is known today continues to change at a rapid rate and will continue to change forever as the world that we all reside in is ever changing. Technology has had a major influence on education, and the world in general. “If students are not being taught to use technology, and not being taught adequate math, science, and communication skills, the United States will continue to lose its superiority to other countries” (A Nation at Risk, 1983). In order for the United States to keep up with the competitive commerce, today’s students need to be pushed a little more to achieve more and not just be satisfied with mediocrity. There was a time when funding private and/or parochial schools was not even an issue, as it was clearly understood that government monies was allocated for public schools. As time went on, needs changed, be it individual needs such as students with disabilities, or families of low income. With these needs came reasons to challenge the norm. Attorneys were contracted, and the status quo was challenged. Nobody could have predicted the changes that would happen nor is it possible to predict the future from today. It is impossible to guess the future of financing education because no one knows what the needs will be in fifteen to twenty-five years from now. It is crucial that past rulings be thoroughly examined to assist with preparing for future financial direction, although that is not the magic solution.

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