Today, Gov. Phil Bredesen is asking Tennessee legislators to calculate how public schools are funded in a new way. In doing so, he has taken into account political winds that could ease the proposal's passage.
At a speech before a joint session of the Tennessee Senate and House of Representatives, Bredesen is asking that four significant changes be made to the state's Basic Education Program, or BEP.
Unveiling the plan to media at an embargoed Wednesday press conference, Bredesen repeatedly credited Republican State Sen. Jamie Woodson (Knoxville) with being a driving force towards the development of the BEP changes. Woodson, chair of the Senate Education Committee, is crucial to any hope the plan would have in passing.
Bredesen also gave due to State Sen. Randy McNally (R-Oak Ridge), State Rep. Craig Fitzhugh (D-Ripley) and State Rep. Les Winningham (D-Huntsville) for their parts in the development of the package.
The recommended changes are;
1. Change the way a county's ability to contribute toward the cost of education is measured. Currently, a county's ability to pay for education is determined by a complex statistical regression equation that attempts to calculate a county's revenue.
Under the new plan, a county's ability to pay for education would be based upon measuring two factors: assessable property and sales tax.
2. Eliminate the "Cost Differential Factor," or CDF. The CDF is a mechanism that inflates salary dollars for certain school systems. It attempts to calculate wage competitiveness in a local workforce and is based upon 90+ industry subgroupings. Only 17 school systems benefit from the CDF.
If the new plan is enacted and the CDF is eliminated, funds that have gone into the CDF will be redirected to increasing state's share of teacher salaries.
3. Increase state's share of instructional funding from 65 percent to 75 percent. Funding of teacher salaries represents the largest share of al BEP dollars. The state currently pays 65 percent of a teachers salary with the remaining 35 percent provided by local government.
While the state would assume a larger share of paying teacher salaries, the rules would be intended to keep counties and cities from merely using the new money to replace local dollars. The current "Maintenance of Effort" statute, requiring local systems to keep up their current funding levels as outside funding increases, would still apply.
4. Increase unit cost for teacher pay. According to Bredesen, the current unit cost figures for teachers are not reflective of "real-world costs" and allow for greater disparity in teacher pay among school systems, placing a higher burden on local governments to fund teacher positions not covered by the BEP.
With increased unit costs moved to a higher target, Bredesen said that his plan would more accurately reflect those "real-world costs." The goal would be to migrate teacher salaries from a $36,700 average to $40,000.
To pay for this plan, Bredesen says that he would use a portion of the 40-cent-per-pack cigarette tax hike that he has proposed along with increased revenues that the state expects to receive in the next year as well.
In a speech to the joint session this morning, Bredesen told the crowd that when the state funding board meets next week, revenue could dramatically exceed previous estimates. The possible range had been somewhere between $100 and $300 million, with most hoping for a figure around $140 million. Now, according to Bredesen, it is likely that their revenue estimate will fall in the upper end of that range.
Should Bredesen's 40-cent increase be lowered by the legislature, this plan could be funded at a more modest level, and the state could work towards full funding in a future budget. That scenario, however, is obviously not on the administration's wish list.
What is interesting about the proposal is not only that it significantly changes how education is funded in Tennessee, but also its timing.
An address by a governor to a joint session of the legislature happens every year. By law, the governor must give a "state of the state" address. Bredesen has already addressed a joint session of the legislature this year. Typically, any other address by a governor to a joint session is anticipated well in advance due to looming issues that have been in the public eye.
The speech being made by Bredesen today was only arranged on Monday. Bredesen had to receive "invitations" from both Speaker Jimmy Naifeh (D-Covington) and Lt. Gov. Ron Ramsey (R-Blountville). In other words, no one other than a select few saw this one coming.
While the BEP is something that every local government official in the state is acutely aware of, and is of paramount concern due to how many lives it touches, this issue hasn't been in the public eye as the cigarette tax has.
By moving his plan out this late in the legislative session, Bredesen has effectively limited how much time interest groups that might oppose the plan will have to mobilize against it. According to team Bredesen, circumstance has more to do with the timing of this proposal than opportunity. Even if that is true, the timing bodes well for its passage.
Probably the most critical element of the success of the plan is the inclusion of key Senate Republicans like Woodson and McNally in its development.
While Woodson and McNally have not signed off in support of complete funding of the entire plan, they appeared with Bredesen at his embargoed press meeting and stated that they were in agreement on the goals of the proposal. This "endorsement" gives them room to maneuver on the cigarette tax without having to go with Bredesen's 40-cent increase and still support the BEP changes.
Additionally, with the State Senate under the operational control of Republicans, Bredesen had to have some GOP "architects" to give the plan a "bipartisan" stamp for it to have any hope of passage.
What could be the most interesting argument that will develop out of this proposal is how it affects property taxes in a few counties.
With the abolition of the CDF and putting a county's property tax rates into the BEP equation, counties like Williamson and Sevier (Gatlinburg) that have relatively low property tax rates may have to raise their property taxes in the future in order to "keep up." While this wouldn't happen overnight, the possibility is distinct.
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