The state of the State

Roller coaster ride for state funding of education

By MICHAEL D. KLEMENS

After three years of tortured progress up the roller coaster of state funding, education spending crested in June, Last month it pitched over the precipice and hurtled downward. Expect lots of screaming this spring, but not from the exhilaration of the ride.

On February 9, Gov. James R. Thompson notified the State Board of Education and the Board of Higher Education that he would recommend increases in new spending authority of less than 3 percent for the year that begins July 1, fiscal year 1991. With inflation projected at 4 percent, Thompson's recommended funding would constitute a loss in purchasing power.

The descent was not unanticipated. Thompson and his aides have been sounding the warning since fall that 1991 would be a year of maintenance budgets. The state's budgetary balances that in fiscal 1990 permitted an unprecedented $1.4 billion in new general funds spending have been exhausted.

The governor broke the news in nearly identical letters to the State Board of Education and the Board of Higher Education: "Excellence in education has been my number one priority. I believe that the board's fiscal year 1991 budget recommendation is reasonable and appropriate in light of the program needs that exist . . . ." He continued, "In light of. . .financial constraints, my budget cannot provide an increase as large as the board recommends. To do so is not affordable.''

Thompson proposed $84 million in new general funds spending for elementary and secondary education. He recommended $43.7 million in new general funds spending for higher education. Thompson left it to the boards to allocate the total increases. He delayed a recommendation on pension funding, where adherence to a new state law requiring higher state contributions to pensions would add another $100 million to education spending.

For the State Board of Education the governor's $84 million contrasted with their request of $271.7 million (9.1 percent). Major components of the board's spending plan included a $180 million (or 8.7 percent) increase in general state aid a $37.2 million (8.7 percent) increase in funding for categorical special education programs and a $40.8 million (25.6 percent) increase in funding for various 1985 reform programs. The 1985 reform jewel, remedial programs for preschoolers, would get $30 million.

Similarly the $43.7 million in new funds that Thompson recommended for higher education is a far cry from the $165 million (10.2 percent) increase sought by the Board of Higher Education. The board had requested new funding of $16.2 million (a 9.2 percent increase) for the Illinois Student Assistance Commission's need-based Monetary Award Program, new money for community colleges of $15.2 million (6.7 percent) and 6 percent salary increases for public university faculty and staff.

Both higher and lower education vowed to push for more money. Richard D. Wagner, executive director of the Board of Higher Education, said Thompson's recommendations fell $45 million to $50 million short of what he considered a basic maintenance budget. Wagner said the board preferred to maintain its tuition freeze but would consider tuition in light of all budget needs. "We will continue to support the Board of Higher Education's fiscal year 1991 budget recommendations and will work with members of the General Assembly and the governor to achieve a greater state investment in education."

C. Robert Leininger, state superintendent of schools, termed the State Board of Education's original budget request a "no frills'' proposal. He promised to push for more money: "The State Board and Illinois' education community will work very hard with lawmakers during the appropriations process to give full priority to elementary and secondary education."

10/March 1990/Illinois Issues

Education's standing relative to other state spending will not be known until March 7, when Thompson proposes the bulk of his budget. Nor are his recomendations apt to be uncritically accepted. State lawmakers will take a crack at the Budget and could, if they chose, increase or reduce new money for schools and college campuses.

The case can be made that given last pear's dizzying ascent, 3 percent is not all that bad. Over the two years both lower and higher education spending would increase more than 10 percent annually. The real problem is the roller coaster syndrome. Take elementary and secondary education. In fiscal year 1986 — the year of education reform — state spending for public schools was up 13.3 percent over the previous year. In fiscal 1987 it was up 7.7 percent over 1986. In fiscal 1988 school spending dropped 4.5 percent. In fiscal 1989 spending rose 5.3 percent. In fiscal 1990 it soared 16.9 percent. That is two booms and one bust in five years, a pattern that was identical for higher education.

The roller coaster funding cycle is tied directly to the political cycle. It is no coincidence that the high points in funding came in 1986 and 1990, just before gubernatorial elections. Education and other tax eaters grab the money when they can politically. Last spring, when total slate new program spending could have been boosted $1 billion without an income tax increase, nobody said, "We don't need it." Instead, all saw the opportunity that Chicago's budget shortfall offered for a state tax hike and jumped aboard.

But it's hard to run programs on a roller coaster. When there is lots of money new programs are started, and teachers and professors get raises. On the downhill trip it is hard to find the money for the new programs and higher paid staff.

Taxpayers ride the roller coaster, too. Last year they got hit for three major tax increases (gasoline, income and cigarette) and several minor hikes. It will take a lot of convincing before they buy a ticket for another ride.

For fiscal year 1991 the roller coaster ride continues with a downward plunge. History says that the ride will bottom out, reverse and climb back up. Everybody would be better off going round in circles on a carousel. At least they could grab for the brass ring.

March 1990/Illinois Issues/11