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School Funding & EdChoice Presentation - Q & A Round 5
Feb. 20, 2020 -- The District is compiling and sharing answers to the approximately 80 questions submitted ahead of and directly after the January 9 public presentation on school funding. Ten questions and answers are provided here, and more will be addressed periodically in the coming days.
Have you taken a look at what is happening to property values on the high end homes in Cleveland Heights in 2019? Sale information shows that the market values in homes above $400k has dropped between $100-250k over the past 10-15 years in a low interest rate environment where values are increasing elsewhere. Isn’t this very bad for our community. Have you considered what will happen to home values in CH-UH if we force through these additional property tax increases? Have you considered what will happen to CH-UH when the next recession hits. Will people be able to pay these astronomical property taxes?
The District continues to be concerned with the property tax burden of our residents, which is why we have been heavily involved in the Cupp/Patterson proposal to change the way public schools are funded in Ohio. The current funding system is unconstitutional due to overreliance on property taxes.
How are vouchers accounted for in the District's Comprehensive Annual Report? There does not appear to be a line item for payment of vouchers. That report also suggests that the district has a total revenue of $136 million (page 33), which for 5,000 students amounts to approximately $26,000 per student. That does not match the per-student expenditures cited by the state of Ohio of $14,404 per student or $22,722 per student. Why are those numbers different? What is being included/excluded in those various reports?
The CAFR is on a GAAP basis of accounting. All ODE reports (District Profile Report, District Report Card) and the five-year forecast are on a cash basis of accounting, so there would be significant differences.
Can we have an outside evaluation done of our spending including evaluation of our union contracts so the public can see the best use of our tax dollars to benefit students while being fair to staff and the community?
All of our union contracts are available for view on the district website, here. Comparisons to surrounding districts are done during bargaining.

What are the plans to dispose of the properties at Wiley and Millikin?
The District is in the process of reviewing all properties as part of the Phase 2 Master Facilities Plan.
What state laws are most problematic, should be reformed, and how to more equitably fund public schools?
The funding formula for EdChoice.
Will there be an opportunity for follow up dialogue to the answer to these questions? 
On February 27 and March 5, there will be school funding conversations held at Monticello Middle School and Noble Elementary, respectively. District leaders will be available prior to the presentation and after the presentation for one-on-one discussions. More details about the events can be found here.
How many students does the state provide aid for compared to how many are enrolled in CHUH schools?

Why does only the state deduction for vouchers appear to be increasing on the five year forecasts for the last several years but there is not a corresponding increase shown in state revenue to the district?

Is it true that when CHUH enrollment has decreased while the state budget is fixed our district has been funded for more students than are actually enrolled?

Why does the superintendents letter to families on December 10 indicate an actual loss last year of $4.2m due to ed choice vouchers if that amount is only the deduction in aid.. Isn’t there also an addition to aid specifically for vouchers that offsets this deduction?

Answer to all 4 of the above questions:

State funding for schools is complex and confusing. It changes with every biennial budget. In an effort to keep things simple and explain the concept of EdChoice (how the program takes more money from districts than it funds) we used our formula state share in our example. However, we have been asked numerous questions about the exact amount of state money received for EdChoice students. The answer is complicated.

The state begins their funding formula with a base amount for each student, currently at $6,020 (this amount changes slightly by year). It adjusts that amount based on a district’s ability to raise funds locally, calculating a state share percentage. The most recent state share for our district is 36%, which means if the formula is adhered to we would receive $6,020 x .36, or $2,167, for each student. This is the number used for illustrative purposes in examples and answers previously provided.
There are also a myriad of other components and factors to the state funding formula to come up with a total state funding amount. What is important to note is that primarily based on enrollment trends, districts can be on a guarantee (floor for a total of state funding received), be true formula (receiving funding for all students), or on a cap (ceiling on state funding that can be received).
2017 was the last year the district was on the “formula” for state foundation funding, which essentially means we received our state share for all students – both students taking EdChoice vouchers and our own students. We received $934,075 for the 476 EdChoice students, and had $2,256,017 deducted for EdChoice students, for a net loss of $1,321,941.
In 2018, the EdChoice enrollment increase drove the district onto a “cap”, meaning we only received 89% of state funding for all students. We received $1,544.362 for the 680 EdChoice students but lost $2,067,279 in state funding due to the cap, which is a net loss of $512,916.98. We then had $3,232,403 deducted for EdChoice, for a total net loss of $3,745,320.

In 2019, we remained on the “cap” due to increasing EdChoice enrollment, and we continued to receive only 89% of state funding for all students. We received $2,024,512 for the 883 EdChoice students but lost $2,149,906 in state funding due to the cap, which is a net loss of $125,393. We then had $4,187,249 deducted for EdChoice, for a total net loss of $4,312,643.

In 2020, state funding was frozen for two years at the 2019 level. Even though EdChoice vouchers increased to 1416, we received the same funding, which was the net $125,393 loss for EdChoice students. We then had $7,092,141 deducted, for a total net loss of $7,217,535.

In 2021 with frozen state funding we expect the same $7,217,535 loss plus an additional $500,000 deduction for new vouchers, for a total loss of $7,717,535.

This is why we brought districts together in November in Columbus to build a coalition to advocate for change. This is why we’ve met with legislators, lobbied through our state professional organizations, and testified in Columbus. This is not sustainable. We are advocating that the state fund vouchers directly and end the deduction from public schools, and we encourage our residents to do the same.