Three recommendations I've been giving
I recently found out about the Advancement Project’s campaign against school closures. It was so exciting to come across their well-designed and helpful materials for communities fighting against districts trying to close their schools. I’ve been recommending people get in touch with them for legal and technical support for such campaigns since I spoke with a couple lawyers doing that work.
In our call, they asked me what I think about the current crisis and I found myself listing, in a way that I haven’t in other places, what I recommend that groups demand when fighting closure. When you’re trying to keep schools open you might have to present some kind of alternative to the school district when they say “but how do we save money?” or something of the sort.
No matter what happens this week with the presidential election, these policies will likely be viable paths for thinking about school district crises.
Of course, districts are the ones in charge of figuring this out, but they tend to have a more neoliberal and ruling-class aligned way of thinking about these issues, since they have to respond to property owners, taxpayers, the chamber of commerce, elected officials representing the regional ruling class, etc. They have they fiscal narrative, we have to create ours. As I’ve said in the past, even if district leaders are very nice people who want to do what’s best for children, there are structural forces of racial capitalism (manifesting through property values, catchment boundaries, class size, credit ratings, capital programs, etc) that try to get them to toe a line that doesn’t actually serve children. This is one way capitalism undermines its own social reproduction, as Sue Ferguson might say.
So movements, unions, and communities have to come up with other ideas to push back against this dominant structure force. It can be difficult to do this since school finance is so abstract and hard to understand. But we have to try anyway. And you can’t just talk about what’s wrong—the story of decreasing revenues, the history of giveaways to the rich—because we need actionable policies as well as critique.
So without further ado, here’s what I’ve been saying in my critical workups, phone calls with leaders, and other venues. I try to be realistic about these and characterized them in my call with the advancement project like this: one recommendation is creative but volatile, another recommendation is actionable but confusing, and the final recommendation is very concrete but hard to change.
Creative but volatile: politicize the discount rate
Readers will be familiar with this one, but it’s worth repeating. One big stress on districts right now are increased pension contributions. I’ve seen this in Chicago and Ann Arbor. The great financial crisis and the pandemic shutdowns have led to rough waters for governments and their revenue, and doubly rough waters for pensions, whose funds are invested in the markets, which have seen a lot of uncertainty and volatility. The combination of irregular returns and unstable contributions have left the pensions in a bad way, which means they need more money to stay above water.
But who decides where the water level is? Turns out that this kind of decision—how much employers and workers owe the pension—isn’t fixed in stone, but rather the result of a series of educated guesses made by consultants who do economic modeling, largely from an investors’ perspective. Pension managers, taking their cues from the consultants, settle on a discount rate to determine what the pension contributes should be.
But what if that discount rate weren’t just made for investors and returns pure and simple? Would the outcome be any different? What if we changed the discount rate to reflect our values now rather than an investors’, particularly given contemporary uncertainties?
This recommendation is creative since it finds new ground to politicize and create freedom where there might not have been before. But it’s volatile, since the discount rate is basically our sense of the future. Is it irresponsible to not pay as much now, but then pay later? What do we risk by messing with it? Still, I think it’s worth looking into.
Actionable but confusing: the Inflation Reduction Act
Another thing I tell people looking for proposals and demands that might help navigate choppy budget waters is to go the district office of capital programs and finance office and ask them if they’ve considered redoing their capital plans to take advantage of Inflation Reduction Act money. Specifically, the direct pay tax credit provides at least 30% reimbursement for green infrastructure technologies. Depending on your district, you could get up to twice that.
UnDauntedK12, which is taking an inside route on this strategy, has a neat map that’s tracking such IRA projects. Meanwhile, the organizer of organizers People’s Action has a Green New Deal for Schools campaign that’s taking an outside route and doing grassroots work on this front, which I’ve written about before.
This strategy is actionable because there are federal programs right now that school districts can apply to for those reimbursements, which will save money over the long term, and even the medium term since energy efficient technologies are, in fact, energy efficient, creating savings on energy use.
But this program is confusing. It’s hard to organize around, to communicate, to understand. Plus school district finance officials have their ways of doing things and it’s difficult to convince them to change, it’s confusing for them since it’s such a different arrangement. (Plus, if Republicans take power in the next federal election, the programs could be closed. It’s a risk.)
Concrete but hard to change
A final thing I recommend districts look at are the policies that prevent districts and municipalities from increasing their mill rates. Local governments still provide a significant portion of school funding and it’s the rates on which they tax their property values that determines how much they take in. But they can’t just increase taxes willy nilly, they sometimes need to get a referendum vote in the locality to increase this revenue.
Increasing mill rates is a big lift because higher taxes are a bummer to put it mildly, but this whole structure is hard to change. The same goes for state grant formulas weights. But I recommend getting into the weeds on the mill rates and state formulas, even if they’re hard to change, and demanding that they change.
Again, these things all have their drawbacks, but they loosen up the mind, inject some contingency into otherwise immutable-feeling budget situations. The chances of them working could be low. At the same time, we have to keep these in our pockets as we fight out there on the terrain to strengthen public education and make it more public.