Mon., Jon. 16, 1961 The News-Review, Roseburg, Ore. 11
State's Strained Tax Structure Won't Stand Needed Increase For Operation Of Schools
Tht last rricl in a ttritt of
iix about finding! and rtcom
mtndationi of tha Lagiilativt In
tarim Committao on Education
it davotad to financing. It in
cludat oxplanation of tha propoi.
ad "equaliiad flat grant" formu
la, which calli for uta of 12'i
par cant of O&C timbar salts ra
ctipts at offiatt to statt aid.
This proposal hat provad to ba
tha tinglo mott controvartial it
ua among rtcommtndations, par
ticularly In Douglat County which
would lost about half a million
dollart in ttata aid if tha plan
war adoptad.
By WILMA MORRISON
Lagillativo Consultant
Intarim Committao on Education
Increasing educational costs that
are as inevitable as the Oregon
children already born, and a prop
erty tax structure that is al
ready strained, make it imperative
not only that the state's contribu
tion to schools increase a mini
mum $42 million in the next six
years, but that the proportion of
costs borne by the state Basic
School Support Fund be made a
constant one.
This is the reasoning underlying
recommendations for changes in
stale school finance as described in
the report of the Legislative In
terim Committee on Education.
The most difficult job handed the
interim committee by the 1939 Leg
islature was to bring to the 1961
session a "long-range policy of fi
nancing public education. . .denn
ing state and local responsibilities
and suggesting specific revenue
and distribution programs." The
committee's legislative proposals
on finance deal with two entirely
separate parts of the state school
support program.
The first part is the basic fund
itself, the total amount that I he
Legislature appropriates to public
schools from state general fund
receips. The second part is the
distribution formula, the method
and purposes involved in distribu
ting the fund among local districts.
These two processes have always
been separate, yet their contusion
is the commonest block to public
understanding of how Oregon's
schools are financed.
"The basic fund has become the
single most influential financial
factor outside of property taxes,
governing the quality of Oregon's
public schools", the committee re
port says. "It has been a variable
factor." Proposed legislation is:
(1) that the annual amount of the
fund be increased until it approxi
mates 50 per cent of the statewide
-
I
I
j
k
1
The Viewing' s Fine
On Channel 9
total of district operational budg
ets; (21 that this percentage goal
be nlten into the law with the
(amount of the appropriation each
vear based on a percentage of ac
.....I -.1 I t- ..r .... ......
i ludi siuuui iusis ui uie seiuuu pre
ceding year.
i The legislation is more than a
i recommendation for an increase in
j appropriation, the report says. It
defines a general policy of state
local school finance where there
I has been no policy definition. Pres
ent method of arriving at the
j amount of the basic fund is not
based on any percentage of school
costs. It is an arbitrary, and con
fusing, statistical device (current
ly S105 per census child) not di
rectly related to anything since all
children 4 to 19 years do not at
tend public schools, and S10S has
nothing to do with the amount any
district gels from basic.
When the basic fund was set tip
rin 1947, it was on the basis of S0
.. . I. ..,.. ,.a;A in
if! ii-iisu num. Ik laiseii
1950 to $80, and in 1957 to $105
per census child.. The trouble is
that school costs have gone up
faster than the increases in the
fund so that the proportion of costs
carried by the state has fallen
from 41 per cent to about 36 per
cent.
The proposal is that the near 50
er cent goal be readied in steps,
leeinnine with an increase to ap
proximately 42 per cent or about
$62 million next year, and. reach
ing 50 per cent or around $95 mil
lion in 1965-66. The projected $62
million next year would be an in
crease of $7.7 million over the
1960-61 appropriation.
enrollment and other cost fac
tors reported by the interim com
mittee point to a steady climb in
the total school budget (including
capital outlay to which the state
does not contribute) to $233-243 mil
lion in 1966-67. This, the report
says, is conservative since the es
timated increase of 36.000 children
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by 1964-65 is based on Oregon chil
dren already born and allows nolh
iiK for inmigralion.
Orpffnn hue kpnt itc erhiuilc rl.
pendenl on property taxes lo a
greater extent than is the case na
I initially or in neighboring states.
Currently property is carrying 67
per cent of school district costs
here, compared to 50.1 per cent for
the nation; 49 7 in California; and
28 8 in Washington.
"It is at best unrealistic and. at
worst, a threat to both schools and
other branches of local government
that depend on property," the In
terim Oommittee said, "to expect
that property taxes should carry a
major part of Oregon's inevitably
rising school budget.
"Adoption of a policy of slate-local
responsibility for school finance
and appropriation of state funds
. . . .is one thing; the allocation of
funds equitably and efficiently is
another," the report said. "Devel
opment of a distribution program
is the point at which the hard,
cold facts of educational finance
in Oregon must b faced."
Some of those facts that make
controversy inevitable are: The
great variation in ability to support
schools among districts and coun
ties; the present support sources
that have been adopted without re
gard to one another, and honest
differences about the goals stale
aid should accomplish. Finally, the
committee report said, the stakes
individual districts have as "re
ceivers of" or "contributors to"
the slate fund "makes it virtually
impossible to secure general ap
proval of a new program."
The new formula, which has be
come known as the "Equalized
Flat Grants Plan," represents a
change in the governing principle
of state-level school support.
The interim committee proposal
attempts to state a governing prin
ciple for Oregon's structure of
school finance. This principle is
the coordinating of state, county,
and rural district funds to a com
mon objective the guaranteeing
insofar as possible of a foundation
program for every boy and girl
in every district and with as uni-
form a tax effort throughout the '
stale as is administratively possi-'
ble.
The foundation program is based
on the amount spent per child.
per year, by a reasonably effi
cient, low cost, first class district.
Intent of the proposed formula
is: to guarantee that each district
shall have the foundation program
($273 multiplied by the number of
students) from a combination of
state basic funds, whatever non
property lax resources it has, such
as a share in receipts from O&C
lands and federal forest fees, and
the application of a uniform tax
millage. Stale funds would make
up the difference in the county
wide total of local school budgets,
after receipts from a uniform tax
levy, plus non-property resources
are counted in.
Equalization would be at the
county level with the counties re
ceiving the funds and dispersing
them to districts in flat grants.
Granting of O & C funds to
schools and inclusion of a portion
of these revenues in computing the
amount of equalization rid school
districts receive has been a con
tinuing controversy. Payments' to
18 Oregon counties from the O&C
source amounted to S14.7U0.O0O last
year. The committee proposal stip-1
ulates that 12U per cent of this in-!
lieu-of tax mnncv be paid to ;
schools and counted as local school
income in these counties.
Because it is unfeasible to make
extreme and abrupt changes in
the amount of state money now be
ing received by individual districts,
and because some districts have
unusual finance problems, several
qualifications have been imposed
on I n e proposed tormina.
The principle one is the provision !
that no district shall receive less
than 25 per cent of the per child
foundation program amount. This
provision is to compensate those
few counties whose local resources
are high enough that they would
receive no stale aid under the
equalized formula.
There would be a distressed dis
trict allowance, the report said,
from which extra money would be
paid lo districts whose total school
levy is 21 mills or more and whose
operating levy is 15 mills or over.
Allowance during the first two
years has also been made to help
those districts that would lose sub
stantial amounts of state funds un
der the formula.
Summarizing the inequities and
distortions that make the present
allocation of basic funds unsatis
factory, the report said the three
most obvious dtlicieiuies arc: ill
A good many districts have been
able to operate schools with no
local property tax; (21 in some
cases where distribution of state
equalization money results in a
fairly uniform levy in a county in
support of the foundation program,' The committee report includes (of tax and educational equaliza
the rural school district tux w hich two alternatives that werr consul, lion I has not been cay. nor is the
also equalizes taxes within the ered and rejected by the Coiiiinit- end result as simple or understand
county, then unbalances that levy; lee ;a!le as the committee would have
and (3) some districts are getting hi conclusion, the report says: liked it lo be. It is unfortunate,
extra basic funds for growth with-: "Development of a practical for- but equity and simplicity do nut
out regard to actual need. i inula to carry out this philosophy ' necessarily go together.-
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