Kansas House panel eases off plan to delay school aid funds

? Public schools would have to wait before getting some of the increased aid they were promised last year, and some of that increased aid could actually be cut under bills being considered in the Kansas Legislature.

In fact, the Lawrence school district stands to lose $1.3 million this year under one bill being considered in the Senate. If that were carried forward into future years, it would effectively negate the property tax increase that voters in the district approved this week in a mail ballot election.

Those moves are part of legislative efforts to balance the current fiscal year’s budget in the face of a projected $279 million revenue shortfall, a shortfall that could get worse if, as many now suspect will happen, January revenues come in below expectations.

But the moves also reflect frustration that many Republicans feel because the cost of the funding increases approved last year turned out to be higher than expected.

“It’s proving we have such a convoluted formula that even the Department of Education can’t understand it, that they would be so incorrect in their projections,” said Rep. Ron Highland, R-Wamego, who chairs the House Education Committee.

Last year, the Kansas Supreme Court ordered the Legislature to fully fund what are called “equalization formulas” that subsidize capital outlay and local option budgets for less wealthy districts. Those are school district funds that would otherwise come only from local property taxes.

That was expected to cost about $126 million, based on the school budgets that were in place at the time. But when school districts set their new budgets in August, many more of them raised their budgets to take advantage of the new aid available, which drove the cost higher than the estimates.

On Wednesday, Gov. Sam Brownback’s administration proposed an emergency stop-gap bill it said lawmakers need to pass quickly to prevent a cash-flow problem in February that could force the state to delay payments to school districts and Medicaid health care providers.

Brownback’s plan called for delaying payment of about $45 million in capital outlay aid to school districts until June 15, two weeks before the end of the fiscal year. But on Thursday, the House Appropriations Committee voted to amend that provision, agreeing to pay about $25 million, while delaying the rest until June 15.

That would have only a small impact on the Lawrence district, which receives about $320,000 in capital outlay aid. But a bill coming up for a hearing in a Senate committee next week would take a much bigger bite out of Lawrence’s budget.

That bill would change the way LOB equalization aid is distributed. Currently the formula bases eligibility for that aid on the district’s per-pupil property valuation.

Under that formula, the tiny school district of Satanta in western Kansas — in an area rich with oil and gas wells, but very few students — is considered one of the wealthiest districts in the state, on a per-pupil basis. But the Blue Valley school district in Johnson County, often thought to be one of the wealthiest areas of the state, actually qualifies for equalization aid.

“Nobody in their right minds defines Blue Valley as poor,” said Sen. Ty Masterson, R-Andover, who chairs the Senate Ways and Means Committee.

Masterson is pushing a bill to change the LOB equalization formula to base it on each district’s total valuation, regardless of size, which would immediately cut aid for many of the state’s largest school districts.

“But there’s some collateral damage in the process,” said Senate Democratic Leader Anthony Hensley of Topeka. “You have poor school districts, inner-city school districts, that are going to take a hit as well.”

According to figures from the Department of Education, the bill would reduce LOB equalization aid overall by $39 million. Lawrence would lose $1.3 million under that plan, or 22 percent of its aid. Wichita, the state’s largest district, would lose nearly $4 million, or 6 percent of its aid. And Blue Valley would lose all of the $3.3 million in equalization aid it receives.

The Ways and Means Committee postponed a hearing that had been scheduled for Thursday on that bill. The hearing is now set for Feb. 2.


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