Equalization grants: Are poor systems driving Pintos while Gwinnett cruises in a Lamborghini?

Catlady, a longtime poster to this blog, has been asking the AJC to look at the strange calculus of Georgia school equalization grants through which Gwinnett out earns many poor Georgia counties.

The equalization grant program forces wealthier school districts to share money with lower wealth districts. While similar grants have been controversial in other parts of the country,  the program has not roused widespread opposition here.

I am happy to report that AJC reporters James Salzer and Nancy Badertscher examined this year’s $436 million grant program and found some odd stuff.

Among their points: Somehow, Cobb and DeKalb don’t qualify for equalization grants, but Gwinnett and Henry do.

As Quitman County’s school chief Allen Fort said about the formula:  “What we have is a Ford Pinto. What Fulton and Cobb have are a Cadillac and Ferrari. What Gwinnett has is a Lamborghini. When their Lamborghini has a flat tire, they get an equalization grant. When our Pinto has a flat, we get nothing.”

One of the systems the AJC reporters highlight is Calhoun County, which they describe as “a two-school system of about 600 students from a no-stoplight town 80 miles south of Columbus. Vast fields of peanuts, cotton and corn spread out across much of Calhoun County. The population is slightly less than 6,700, about one-fifth of which resides in the local state prison. The non-prison population is about half of what it was a century ago.”

The piece juxtaposes Calhoun with Gwinnett:  (This is an excerpt. Please read the full AJC.com story.)

The “equalization” fund’s biggest check this fall will go to Gwinnett County — Georgia’s largest school district — followed by Clayton, Paulding and Henry county schools. At the same time, many rural districts in desperate financial condition will receive smaller grants than last year, and some will receive no help at all.

Here in impoverished Calhoun County, the grant of $150,000 for the coming school year represents a 50 percent cut from last year. Gwinnett will receive $43 million, an increase over last year and enough to cover Calhoun’s entire school budget for six or seven years.

“We don’t have art, we don’t have music, we don’t have JROTC,” said Calhoun County Superintendent Danny Ellis. “We don’t have the luxury of offering summer school. … We are cutting to the bone and there is no meat. It is literally a situation where you just wonder what can we do to stay open.”

The system is so strapped that teachers will get seven days of furloughs; Calhoun also cut a bus route and all three instructional coaches to save money. It offers only one AP class, in history. By comparison, Collins Hill High School in Gwinnett offers 21 AP courses. Calhoun’s high school has a total of 12 teachers; Collins Hill has 21 in the English department alone. Teachers in Gwinnett face two furlough days next year, five fewer than teachers in Calhoun County.

The equalization fund, set up in 1985, is supposed to provide greater equity in school funding for systems with lower property tax bases. But the collapse of the real estate market in metro Atlanta has changed this landscape, too, and the largest grants go to districts that are neither rural nor comparatively poor.

In the final hours of their 2012 session, state legislators passed a bill intended to slow the growth of the equalization fund and get more money to poor rural districts. And, in fact, this upcoming school year’s grant to Gwinnett is $13 million lower than it would have been under the old rules.

“It’s a lot fairer now than it was,” said Senate Education Chairman Fran Millar, R-Atlanta.

But the Legislature’s last-minute fix didn’t result in windfalls for many of the state’s poorest districts, and communities left out in the cold are mystified by lawmakers’ interpretation of “equalization.”

“What can we do to get some?” asked Dennis Holsey, whose son attends Hancock (County) Central High School. “We need money. We don’t have too many jobs in our area. Poverty is high. It’s not fair that our kids don’t have the same opportunities.”

Hancock County’s system, with the second-lowest household income in the state in 2010, gets no money from the equalization fund because, under the formula used for doling out the money, Hancock is too property-wealthy for its number of students.

“Our [tax digest] has declined much faster than the rest of the state,” said Rick Cost, chief financial officer for Gwinnett schools. “At the same time, we’ve also been growing faster in student population — the double whammy.”

–From Maureen Downey, for the AJC Get Schooled blog

121 comments Add your comment

Peter Smagorinsky

June 19th, 2012
5:58 am

And yet, if kids in Gwinnett do better on tests than kids in Hancock, Arne Duncan will conclude that it’s because they have better teachers, not better conditions for teaching and learning.

mountain man

June 19th, 2012
6:35 am

Make sure when you do the calculations, you do so on a PER STUDENT basis. Also, don’t forget to include the millage rate that each county taxes themselves for education.

Dunwoody Mom

June 19th, 2012
6:41 am

That Gwinnett Schools receive so much money while other school districts are facing massive financial difficulties is criminal in my book. I would love, as a DeKalb Taxpayer and school parent, to sue somebody for this nonsense.

Tucker Dude

June 19th, 2012
6:49 am

The DeKalb School System has been run by idiots for the last 30 years… and Gwinnett is one of the top five most populous county in the entire State, hence more people to tax. They obviously have better lawyers to write their grant applications as well. DeKalb County likes to send money to contractors to build more school buildings instead of improving the existing schools with more resources and better trained personnel.

Howard Finkelstein

June 19th, 2012
7:00 am

All these funds could be better spent on road improvements.
Since there seem to be accounting inconsistencies, the entire program should be eliminated.

Skeptical

June 19th, 2012
7:02 am

If folks in Calhoun County are unhappy, there are plenty of homes on the market in Gwinnett County…and Cobb, Fulton, Cherokee, and, well you get the idea.

Teacher Reader

June 19th, 2012
7:02 am

I want kids in Calhoun and Hancock and other truly rural districts to have close to what kids in Gwinnett, Henry, Palding get in the terms of education. No money should be going to Gwinnett, Henery, or Paulding County schools. These are not truly rural districts.

Old timer

June 19th, 2012
7:09 am

Mountain man…..all that information was in the Sunday paper…..very interesting.

Aquagirl

June 19th, 2012
7:19 am

If folks in Calhoun County are unhappy, there are plenty of homes on the market in Gwinnett County

The solution to legalized thievery is “move.” Very helpful. That works until the formula is re-written, then you have to move again to the county with the best shyster wringing money out of the system.

I don’t see any allowance for the size of the school system. Up to a certain point, bigger is more efficient. With the decline in rural population some of the smaller counties need to merge. It’s a huge logistical challenge for less than 10,000 widely dispersed people to maintain a decent school system.

dc

June 19th, 2012
7:28 am

let’s see……how much state tax is paid by gwinnett county folks (and metro atl for that matter), vs Quitman county…..and how many kids are there. What a complete crock. If you want a better system, spend your tax money on it like Gwinnett has.

And btw, since “spending money on minorities” seems to be the absolute top focus for govt these days, you won’t find more minorities in any other school system……I’ll bet the head of Quitman is a white guy……and he wants to take money away from poor minority kids???? (haha).

What do you want to bet that there is a really good (small) private school where all the better off kids in Quitman go, and thus the taxpayers there don’t ever support decent public school funding.

dc

June 19th, 2012
7:31 am

Of course, it’s a lot easier to “rail against the system that is so unfair”, than to convince your local taxpayers to actually pay for a decent system. Quit blaming others, and fund your own system to a decent level. Jeez, this “take other peoples money” attitude is spreading to all levels of govt and our society.

Attentive Parent

June 19th, 2012
7:40 am

Maureen–

I am glad your reporters are looking into this. On a related note, is the school district the largest employer in many of these rural districts?

Same with some of the USG affiliates around the state. Have many of these been created or enlarged to be the means of good-paying jobs in these rural counties?

Something I was reading about Kentucky recently where education and health care were the only employment opportunities in many areas. Not to begrudge anyone a job but it also means there’s no dynamism to the local economy. Which will always influence the schools when the primary means of employment is ultimately a wealth transfer from another part of the state.

Technology and innovation happen in urban areas and trading areas near rivers because of the vibrant exchange of ideas from people with a variety of backgrounds and interests. Rural economies throughout history have been stagnant. Apart from the Gwinnett real problem, are Georgia’s metro areas and the lottery proceeds being used to try to play make believe about the reality of rural life?

There are real reasons why it cannot achieve comparable prosperity. Redistribution won’t change that. It just allows people to continue to live in places without a real future but for those transfers.

Misty Fyed

June 19th, 2012
7:46 am

Why are you people so surprised? Any time government gets involved in any redistribution project, the benefactors of the redistribution are always the political favorites. Gwinnett and a few other districts are the show ponies of the state. They are the only ones that can get any national recognition. Without their success, Georgia is just that state that is ranked 47th nationally in quality of education.

How about this? Each district fund it’s own program. That’s a novel idea. If Calhoun wants to trade in its Pinto on a Lamborghini; let them pay for it. If Gwinnett’s Lamborghini gets a flat, let them pay to repair it or consider downsizing to a more economical program.

All redistribution programs are unfair depending on where you are in the food chain. I’m sure if Calhoun was getting $43 million they’d not be complaining about how unfair the system is. If you are seeking fairness, let each system stand on its own. Every child is entitled to the best education his/her community can provide…not someone elses community.

The Hammer

June 19th, 2012
7:51 am

As someone else has already pointed out, the issue is these “poorer” districts a) don’t spend their money wisely, and b) have very low tax rates, thus less money to spend poorly. The simple numbers don’t lie: Gwinnett County has the third lowest property value per student ($136) of any jurisdiction in the entire state, behind the Pelham City ($24) and Clayton County districts ($115).

Joe Frank

June 19th, 2012
7:51 am

How about we stop equalization grants all together and fund QBE for one time since it was started, which has NEVER been done, and see how that works?

say what?

June 19th, 2012
7:57 am

Do away with these grants period. If they must remain, then a district should only be elgible if it has maximized it property tax rate on its property owners for at least two years prior to receiving any funds.
The amount sent to the state, should also be cut in half. This program should be a bare bones program that districts should not automatically receive or expect to receive.

Rick Cost?? He was the CFO for either Dekalb or Clayton,right?

Ernest

June 19th, 2012
7:59 am

Joe Martin has had several interesting and enlightening comments regarding equitable funding for schools along with the equalization grants. There have been several blogs on this topic that are worth revisiting.

Regarding equitable funding, he mentioned that the QBE formula developed in the 80’s has remained static over time and not been adjusted for inflation. He has also made suggestions to modify the equalization grant algorithm to look at the total vs. weighted FTE for each school system.

What a lot of this comes down to is what incentive is there for a ‘receiving’ system like Gwinnett to have its elected state representatives vote to change the funding formulas, especially when they benefit from it?

The blogs I referenced can be found at:

http://blogs.ajc.com/get-schooled-blog/2011/10/06/a-possible-new-funding-model-for-georgia-schools/

and

http://blogs.ajc.com/get-schooled-blog/2012/02/14/reduction-to-equalization-grants-sounds-boring-but-will-impact-many-georgia-school-districts/

At the end of the day, politics rule….

carlosgvv

June 19th, 2012
8:09 am

Political fairness in Gerogia? Not now, now ever, never.

Csoby

June 19th, 2012
8:09 am

Further proof the need to take federal and state government out of the school system and put it local. Having BIG governemnt ,whether state or federal take money and then disburse it is totally criminal!

Joe

June 19th, 2012
8:10 am

It would really help if AJC reporters actually understood the things about which they write. As Mountain Man points out, Equalization is determined on a Per Student basis. Yes, Gwinnett has a big tax digest and a lot of revenue….but, they happen to be the largest system in the state. That breaks down to Gwinnett not being so wealthy when looking at available resources per student. And, if all of that does not make sense….the point about moving to another school district is right on. I wish some school systems would quit complaining about being poor on the one hand while pouring a ton of money into football and sports programs – see Buford City Schools.

Calvin

June 19th, 2012
8:13 am

@ Ernest….Joe Martin needs to give up. His ideas are all old school. His answer, state government should write a check for about $2 billion and everything will be okay in K-12 funding. Smart guy but no common sense.

Dunwoody Mom

June 19th, 2012
8:14 am

The largest school system in the state in a county with a big tax digest and a lot of revenue should be self-sufficient. Other counties, especially ones with their own financial issues, should not be subsidizing education for Gwinnett County students.

there

June 19th, 2012
8:28 am

Gwinnett county, the way the US will look if Romney (it’s our turn) is president, a disaster.

Aquagirl

June 19th, 2012
8:29 am

I wish some school systems would quit complaining about being poor on the one hand while pouring a ton of money into football and sports programs

It’s not only football and sports, it’s programs in general. Mr. Ellis complains Calhoun has no JROTC, and only one AP class. But when you have around 300 students in your combined middle/high school, how many AP teachers can you support?

I’m sure their student/teacher ratio would make Gwinnett teachers green with envy.

Clarence

June 19th, 2012
8:33 am

The article never breaks things down per student, and you have to make it to nearly then end of the article before it mentions how many students Gwinnett has. I had to take out my calculator to get the per student grants, and it is about $250 per student in Calhoun, and $260 per student in Gwinnett. That was using rounded numbers though. The article also goes into great detail on income wealth, but no school district in Georgia funds education with an income tax.

There is no doubt that Calhoun isn’t wealthy, but did you know they spend $3000 MORE than Gwinnett per FTE? Or that they spend 21% of expenditures on Admin, Vs. 14% in Gwinnett? This lengthy piece through out a lot of numbers, but it was basically an anti-Gwinnett rant. There’s a lot more to this than $43 million v. everybody else.

Also, the new legislation passed reduced Gwinnett’s slice quite a bit, as well as eliminated counties like Hall and Cherokee, so I think it is a good deal more fair than what we had.

teacher&mom

June 19th, 2012
8:37 am

@Attentive Parent: So you feel that rural areas, based on their “lack of innovation and exchange of vibrant ideas”, should be left to wither on the vine? Interesting perspective. I suspect you do not subscribe to the idea that a global economy is truly unsustainable, given fuel costs and eventual fuel scarcity, while a vibrant local economy is the key to economic stability.

.

Dunwoody Mom

June 19th, 2012
8:39 am

Also, the new legislation passed reduced Gwinnett’s slice quite a bit

No, it didn’t, from the AJC article: http://www.ajc.com/news/poor-schools-still-get-1459452.html

GWINNETT
• Fiscal 2011: $37.7 million
• Fiscal 2012: $39.9 million
• Fiscal 2013: $43.2 million
• Median household income: $63,219

Buzz144

June 19th, 2012
8:41 am

Maureen, like most leftists, can’t see the forest for all the trees. This is exactly why school vouchers are needed. Tie education money to the student and let the student’s parents decide the best school for their kid. The competition would do wonders for the education establishment. Schools would be forced to streamline and innovate. Inefficient ones would wither and die and efficient ones would prosper and grow. It is the teachers who are against this. They would rather be negotiating with a monopoly employer, especially when that monopoly employer is a government who can force people to pay up or go to jail. It is time for some real change in our system.

teacher&mom

June 19th, 2012
8:41 am

“I’m sure their student/teacher ratio would make Gwinnett teachers green with envy.”

I teach in a rural district that is negatively impacted by the equalization formula. I’m sure our student/teacher ratio would not make Gwinnett teachers green with envy. This past year my student/teacher ratio was 1:30. Next year it will be higher. I have four teachers in my department and I try to keep everyone’s preps to around 2-3 courses (4×4 block schedule), however, some teachers have more preps or teach an extended day to cover the course load. Smaller does not necessarily mean less work….

We have one elementary PE teacher and she will have up to 60 students at time. They cut her para-pro so she is on her own.

BlahBlahBlah

June 19th, 2012
8:42 am

I don’t know if it would matter in this instance, but Georgia has FAR too many counties. Some of those smaller rural counties should seriously consider consolidation to realize some economies of scale.

Clarence

June 19th, 2012
8:42 am

Or how about these numbers? Gwinnett has $148 million subtracted from what they earn in QBE for their “Local Five Mill Share.” About 20% of earnings. Calhoun has about $500,000 subtracted. About 15% of earnings. Education finance is very complicated – the article spends nearly 2000 words on one slice with little context. We do ourselves a disservice when we try to pretend this is as simple as who gets a bigger check in one program.

Clarence

June 19th, 2012
8:44 am

@Dunwoody Mom – You’re right that it did go up, but it would have gone up even higher under the old formula – several million higher.

Solutions

June 19th, 2012
8:46 am

I luv it when the vultures fight over their ill gotten spoils!

[...] Catlady, a longtime poster to this blog, has been asking the AJC to look at the strange calculus of Georgia school equalization grants through which Gwinnett…  [...]

Aquagirl

June 19th, 2012
8:52 am

Smaller does not necessarily mean less work…

I agree in some cases, like the elementary PE teacher with 60 kids. But when Calhoun’s middle/H.S. ratio is less than 12:1 somebody has empty seats in the classroom.

Dunwoody Mom

June 19th, 2012
9:01 am

Well, gee, Clarence, that makes me feel a whole lot better. @@

teacher&mom

June 19th, 2012
9:09 am

@Aquagirl: While the ratio may be accurate for Calhoun…it may also be distorted by special education classes. Special education class size is mandated by the federal government. Resources classes will pull down the overall student/teacher ratio and make it look like everyone in the system enjoys smaller class size.

teacher&mom

June 19th, 2012
9:17 am

If the state would release some of the restrictions on SPLOST funds, my district would benefit.

For example, if the funds could be used to offset transportation costs alone, we would be in better fiscal shape. Under Perdue school transportation costs were shifted to the local systems. At one time the state paid around 50% for transportation. Currently it pays around 12%.

Huh?

June 19th, 2012
9:21 am

If someone could explain to me what school vouchers have to do with the topic at hand, other than a knee-jerk non-sequitur, I’d appreciate it. Vouchers aren’t going to do squat for anyone in the state outside the Atlanta sphere of influence.

NW GA Math/Science Teacher

June 19th, 2012
9:28 am

A lot of the comments above seem to indicate a metro-ish belief that everyone should be taxed at the same rate. We’re talking about primarily property taxes here. That same rate idea is a recipe for disaster. If you tax the farms in south Georgia at the you will have nothing to eat! An acre with a McMansion on it in Gwinnett county should not be taxed at the same rate as an acre with peanuts on it in Calhoun county. Of course, I’m one of those unenlightened, non-cosmipoliton country folk…

Bernie

June 19th, 2012
9:32 am

Buzz144 @ 8:41 am – No Buzz, Vouchers are not the Answer! Many of us around Georgia do not want the tax dollars going directly into the coffers of the Religious Right and their churches, as well a other religious Churches and organizations who will further make the situation worse and with fewer kids being educated. If that is what you prefer then that is your choice, Pay for it, out of your own pocket.

Aquagirl

June 19th, 2012
9:33 am

Resources classes will pull down the overall student/teacher ratio and make it look like everyone in the system enjoys smaller class size.

That’s true of any school system. If it produces more extreme ranges in tiny places like Calhoun, it’s a problem inherent to their size. That’s why I pointed it out, their problem may not lie simply in a low tax base, it’s exacerbated by inefficiency. Hiring a specialized teacher for 5 students hurts your finances. In a school with 300 students it’s a deal breaker.

GeeMac

June 19th, 2012
9:38 am

I teach in Calhoun County. The ratio is closer to 24:1. We have 15 teachers plus 2 coaches for the middle and high school combined.

Bernie

June 19th, 2012
9:40 am

Maureen, the answer to that is an easy one. Some Students are more Equal than Others. Many here and around Georgia knows what that means too! That has been the operational platform that has been in place since the inception of public school education in Georgia. Not until that changes, no one will ever see fairness in the public educational system here. This is primarily why the LOUD YELLS for private school Vouchers is the order of the day. We must keep the system of division and HATE going! its the Southern Way of life……Proudly.

GeeMac

June 19th, 2012
9:44 am

I know that ratio is still a lot lower than most metro schools. And Aquagirl, the problem with consolidation down here basically boils down to physical distance. Our county is geographically large. Why should rural students have to spend hours on the bus?

Maureen Downey

June 19th, 2012
9:45 am

@Macon, I am getting all of those signatures on the petition and plan to talk to the education editor about what is happening in Macon.
THanks, Maureen

teacher&mom

June 19th, 2012
9:46 am

“Hiring a specialized teacher for 5 students hurts your finances. In a school with 300 students it’s a deal breaker.”

Absolutely, but federal mandates give the system no choice whatsoever. Chances are that teacher is paid through federal funds and not state or local funds.

While I can only speak for my rural district, inefficiency is not the issue. We have trimmed our central office and eliminated most teacher/admin positions that were funded at the local level. There are still a few positions that are partially funded by local funds.

We have teachers, who in addition to their regular classroom responsibilities, are overseeing attendance regulations/paperwork, 504 regulations, homebound paperwork, various grants, after school programs, summer programs, etc….often for little to no compensation.

We are efficient.

Rick in Grayson

June 19th, 2012
9:49 am

Take the math compliments of Clarence, June 19th, 2012 8:33 am and the idea of Aquagirl that Georgia nees to consolidate the number of rural counties and you have a solution.

Georgia has a very large number of counties for it’s size. Apparently this was an early state goal that voters would be only be one day’s travel from the country seat for voting purposes.

If Georgia were to cut the number of counties in half, a lot of money would be saved on administrative costs for all kinds of county business including education.

Hamilton

June 19th, 2012
9:49 am

To all that advocate local responsibility – read the Georgia Constitution:

“PARAGRAPH I. Public education; free public education prior to college or postsecondary level; support by taxation

The provision of an adequate public education for the citizens shall be a primary obligation of the State of Georgia. Public education for the citizens prior to the college or postsecondary level shall be free and shall be provided for by taxation…”

A few paragraphs down, you’ll find the local authority: “Authority is granted to county and area boards of education to establish and maintain public schools within their limits.” They receive the money from the State.

Taxation authority belongs to the State – cities, counties and boards of education can set the rate, but only to what State Law allows.

The long and short of it is that if you want management change, throw out your local board. If you want structural change to the pitiful condition of education in Georgia, talk to your Senator, Representative and the Governor. They have the power. Your property tax money goes to the State first, then they distribute it back to local government as your Representatives see fit.

I always find it amusing that people pound the table when it comes to discussing the constitutional and unconstitutional, and they don’t know anything about the complicated Georgia Constitution. Glad I took Georgia History and Civics in 8th grade. No, I’m not a lawyer.

Georgia Observer

June 19th, 2012
9:49 am

While I’m well aware that there’s tremendous emotion on this issue, the bottom line appears to be:

1. School systems get their local revenues from property tax — not income tax or other income-related measures.
2. School systems account for their spending on a per-pupil basis.
3. As a result, property tax revenue per pupil is the core issue — which is what the equalization grants attempt to address disparities in.
4. The rural/suburban/urban characterization is a false dichotomy. It doesn’t matter what the income or other wealth is in a community if the school system can’t access it — property tax wealth per pupil is what counts.
5. Case study: Henry County. Henry County has been at its state maximum on millage for several years. (In most counties, like Henry, that’s 20.00 mills plus bond debt millage). Henry County Schools cannot raise more local revenue, they’re at the cap. That’s why the equalization grants are critical to low-property-wealth (on a per-pupil basis) school systems like Henry — they simply can’t raise any more local revenue.