March 1, 2012

OFF THE FLOOR: Corbett adds pension money to K-12 total, to combat critics of his cuts.

By Peter L. DeCoursey
Bureau Chief
Reprinted With Permission

HARRISBURG (Feb. 28) - First, Gov. Tom Corbett tried to limit his discussions of overall state education funding to the basic education subsidy for K-12 schools, since he supplied more state money for that item than previous budgets did.

But education groups kept noting that he cut lots of other things that the state used to provide along with the subsidy: $429 million that Corbett did not supply last year for tutoring, charter school reimbursements and block grants were the primary items.

And reporters got him to admit that in fact, he was providing less state funding for K-12 schools when you counted those.

Same debate occurred this year: He said the subsidy block grant, into which he combined the subsidy, state payments for Social Security for teachers, transportation and other items, was up.

But he approved a budget deal for this year that gave districts $100 million –approved in June but backdated to the then-ending budget year - to spend on block grants in this school/budget year. This year’s budget didn’t have that amount, so the school districts and lawmakers who got it for them to spend this year, call that a cut.

The governor and his minions say it wasn’t in the current budget as a line item, so it isn’t a cut. By their reasoning, they cut the whole block grant, so they really cut $529 million in state funding this year. The problem with that of course, is it got approved as part of this year’s budget negotiation and got spent by school districts this year.

So the administration was losing the “you cut state funding for education” argument.

Then the administration woke up last week and realized the opportunity they had, since their opponents on the issue kept talking about total state funding for education.

This budget includes $319 million in pension contributions for educators to make up for the fact that the state spent the last 8 or so years under-funding its pensions and those of school employees.

So if you add that $319 million to the total of state funding for education, the total amount the administration proposes to spend on K-12 education goes up sharply, by about 5 percent, almost all of it in the pension increase.

But that is all mandated money, all of which has to go to pay pension costs. It cannot go to any other expense. It essentially is part of a catch-up effort to make up for past under-funding and does not allow the district to spend any more than it did the year before.

The same is true of state funding for Social Security taxes paid by school districts. Districts can control those in the long-term by ratcheting back on pay-raises and other goodies during contract talks. But between contracts, those are mandated costs. So while Gov. Corbett likes to say he gave districts flexibility to move money around, by putting most of their funding into a block grant, parts of that block grant are mandated.

In fact, many educators fear that when Social Security and transportation costs go up, the Corbett budget, which held their subsidies flat and took away the last $100 million of block grants, will leave them only one kind of flexibility: the chance to take education monies and spend them on transportation or Social Security costs.

Education Secretary Ron Tomalis and Corbett say this will teach the school boards to be tougher in contract talks, and more rigorous in managing expenditures. They are out to teach districts not to assume the state will pay its share of the higher costs of ever-rising teacher contracts.

But the governor is right that this budget’s biggest increase of any kind is for pension costs owed to current and past school employees. Which, again, is partly driven by the contracts the boards give out and partly driven by the fact that so many teachers get great evaluations, stay forever and get really good pensions. The state Legislature’s big pension hike for teachers, state employees and themselves in 2001 didn’t help, either.

State law also changed in 2010 so the state had to pay more, unless of course it simply ignored that law as it ignored its pension obligations throughout the Gov. Ed Rendell years.

Corbett deserves credit for following that law and paying those big pension hikes in his first two budgets.

But to portray that increase in teacher pensions, which Corbett by law had to make, as “Investing in Pennsylvania’s Students” as Corbett does on this state education department website, is a bit much.

For a guy who ran for governor saying school districts were over-funded and could and should do more with less money, Gov. Corbett sure does everything he can now to hide the fact that he is governing as he promised in his campaign.

Why? Here is a guy who was so blunt about his goals that state teachers unions gave millions of dollars to his Democratic opponent, Dan Onorato. Why is he trying to hide this clear policy goal now?

Corbett didn’t run as a guy who would plow money into public schools as Rendell did.
He said he would pull back on that and he has.

But it is about his only declared policy on which he shilly-shallies about what he did.


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