Kentucky Tonight Follow-Up – How do Kentucky’s taxpayers really perform for education?

I was pleased to participate in a recent Kentucky Tonight broadcast on KET along with Kentucky Senator Mike Wilson, Kentucky Representative Derrick Graham, incumbent head of the Prichard Committee Brigitte Blom Ramsey and guest show host Renee Shaw (show online here). We had a lively discussion about many education issues that are likely to come up in the 2016 session of the Kentucky legislature.

One surefire subject was education spending in Kentucky. I mentioned on air that once you consider the Kentucky taxpayer’s ability to pay, Kentucky is actually doing a better job than most states in supporting public education. Let’s look at that a little more closely.

The best resource for comparing state-to-state education expenditures comes from an annual publication from the US Census Bureau. The latest edition, which just came out in June of 2015 is “Public Education Finances: 2013.” Earlier versions of the same document have a similar title except for the year.

Within each of these documents is a table, Table 12, which has a rather complex name like, “States Ranked According to Relation of Public Elementary-Secondary School System Finance Amounts to $1,000 Personal Income: Fiscal Year 2013.” Decoded, this is basically a ranking of how much states spend compared to the ability of that state’s taxpayers to pay. This table helps to even the playing field for states like Kentucky where the taxpayers actually do a relatively good job of supporting education given their financial ability to do so.

The graph below shows how Kentucky ranks among the 50 states and Washington, DC for taxpayer support for schools. In this table, a lower number shows better performance.

Kentucky's Rank for Education Finances Vs. Taxpayer Ability to Pay

So, how did Kentucky do?

Back before the Kentucky Education Reform Act of 1990 (KERA) was enacted, even if you considered the relatively high poverty rate in Kentucky, the state did a pretty meager job for its schools, ranking only in 42nd place.

By 1995, after the major tax increases in KERA were enacted, the state had improved to about the median level in 26th place among the 50 states plus DC.

Kentucky then lost some ground, but never all the way back to the 1988-89 level, in the last half of the last decade of the 20th century.

More recently, however, Kentucky’s taxpayers have stepped up to the plate in a rather dramatic fashion. In the most recent two years of data available from the Census, despite rather high levels of poverty, Kentucky’s taxpayers did a better job for education than a significant majority of the other states.

Even if we only look at the straight funding rankings in the Census Table 11, Kentucky ranked 37th in 2013 for its total school revenue. That is up five places from where we ranked for spending in 2010.

But, it seems like Kentucky’s educators simply don’t get the economic facts of life. You can’t pay more if you don’t have more, and Kentucky’s taxpayers, given their relatively high poverty status, are probably being squeezed about as hard as possible for our schools. Continuing to increase taxes is likely to have some profoundly adverse impacts on the economy, including chasing the tax base right out of the state, which would be a real disaster.

This is why I said on the show that we need to focus on efficiency in our schools. And, before our educators say there are no more efficiencies to be found, let me remind you again that we have had a number of special audits from the Kentucky Auditor of Public Accounts’ office that showed educators in this state have been skimming off money meant for kids (discussed here, here and here).

That skimming went on for years in some cases before it was detected. When it finally came to light it was an outside agency, not the internal school management system, that blew the whistle.

With such extreme fiscal misbehavior going on undetected, I suspect there are many more examples of rather poor fiscal management in our schools. So, let’s get a focus on that before we drive our tax base further into poverty, or out of the state altogether.

Technical Notes:

Versions of the Table 12 for 2009-2010 and earlier list the data by school year instead of fiscal year.

For the 1988-1989 school year, the data is found in Table 20 for that year’s Public Education Finances document.

The US Census does not seem to have a specific web page that lists links to all issues of Public Education Finances, but individual issues can be easily Googled with terms like “Public Education Finances: 2010.”