Bill would eliminate aid for new school bond issues

A bill introduced in the Senate education committee would eliminate state aid for school bond issues meant to subsidize costs and even out resources among districts with poorer local tax bases.

Senate vice president Jeff King, R-Independence, introduced the bill Monday. It takes aim at one of the key areas of school finance where the state’s obligations have increased over the past five years. However, it also proposes shifting money that would have been spent on bond aid to another category of school funding that serves an equalization purpose — the state’s long underfunded supplemental general aid payments.

King said in a statement that the bill would ensure “our precious dollars are being used directly to educate Kansas children” and not to “provide more bricks and mortar.”

His proposal, Senate Bill 305, says bond aid “shall only be distributed” to districts with bonds passed by public vote prior to July 1, 2014.

Bills to cut bond aid have cropped up in the Legislature repeatedly in past years, but have never passed.

King’s bill proposes putting bond aid money toward supplemental aid instead.

Bond aid is aid for bond principal and interest and is distributed to districts at rates that vary depending on their relative wealth. Supplemental aid is also distributed based on an equalization formula, but goes toward operating costs like salaries rather than capital costs like construction.

The Legislature hasn’t funded supplemental aid at the statutory level since the 2008-09 school year, according to data on the Kansas State Department of Education website.

Speaking Tuesday, Mark Tallman, a lobbyist for the Kansas Association of School Boards, said his organization is concerned that supplemental aid is underfunded, but would be concerned, too, if King’s bill funds it at the expense of bond aid.

Peg McCarthy, vice president of the Topeka Unified School District 501 school board, called bond aid important.

“One thing we’ve found,” McCarthy said, “is with our mill levy, what we can get locally isn’t equal at all to districts with higher value.”

USD 501 qualifies for 44 percent bond aid based on its assessed property valuation per pupil compared to other districts.

Assessed valuation per pupil in USD 501 was $46,192 last year. By contrast, in nearby Kaw Valley USD 321, it was $251,673 because of a coal plant there and the district’s relatively small enrollment.

USD 501 is planning a public vote in April on a $143 million bond issue. The timing means that even if S.B. 305 passes, it wouldn’t affect access to bond aid.

“This is exactly why we felt we needed to move forward with the election in the spring,” McCarthy said.

Members of the USD 501 board have said they believe waiting until the November general elections to vote on the bond is too risky.

Bond aid — like payments to the Kansas Public Employees Retirement System — is one category of state spending on schools that has steadily increased and is higher today than before the recession. Last year, the state spent $111.5 million on bond aid, up from $79.5 million five years earlier, data from the education department and Kansas Legislative Research Department show.

Appropriations for supplemental aid have also grown since before the recession, but haven’t kept pace with what districts qualify for. When the recession hit and base state aid to schools fell, districts turned to supplemental budgets to fill the gap, thereby boosting the demand for supplemental aid. Since the Legislature underfunds supplemental aid, however, the education department prorates what the districts receive. Last year each district received about 80 percent of its supplemental aid payments. For USD 501, receiving the full amount would have meant another $3.5 million in aid.

King’s office said his bill would resolve the underfunding of supplemental aid within five or six years and that this would help districts lower their mill levies.

Superintendents have said repeatedly that underfunding supplemental aid forces them to raise taxes or cut costs. Eliminating bond aid could, however, push up mill levies for districts planning bond issues.

USD 501’s bond issue would pay for an array of projects, including a new elementary; a career learning center modeled on a program in the Blue Valley district; tornado shelters at schools that lack strong shelters; security improvements, such as bullet-resistant window film and panic buttons, meant to guard against shootings; classroom technology for middle and high schools; and other projects.