How to Reform Education in Ohio: A Symposium

Samuel R. Staley

December 1, 1997

In DeRolph vs. State, the Ohio Supreme Court ruled that Ohio’s current approach to funding public education is unconstitutional. More specifically, the court claimed the state failed to provide sufficient funding to secure a “thorough and efficient” system of common schools. The court also set a one year deadline to come up with a solution.

Not surprisingly, this decision set off a scramble among state policymakers to come up with a solution that would meet the Supreme Court’s test of adequate funding. An independent observer looking at the current debate over school funding might think the Supreme Court mandated two things: 1) increase spending for public schools and 2) raise taxes to generate the necessary revenues.

In fact, DeRolph v. State mandates neither of these policy options.

The Court did not give a blank slate to state legislators, but it did not provide details of what would pass muster as a constitutionally defensible reform either. In principle, the General Assembly would have to design a funding plan that did at least four things to be considered constitutional:

1. centralize school finance so that the state, rather than local districts, has the primary responsibility for funding schools.

2. base school funding on an explicit assessment of the actual costs of educating a child.

3. provide sufficient funds to ensure school facilities are maintained and in “compliance with all local, state and federal mandates.”

4. provide funding to meet the $10 billion (now $17 billion) estimated shortfall in school construction and renovation.

The Court also said the school funding solution could not rely on local property taxes as the primary source of funding for public schools. Thus, the Court clearly said that whatever the General Assembly came up with must ensure that school funding is centralized at the state level and significant differences in funding levels could not be driven by local property tax decisions.

Conspicuously absent from the Supreme Court’s “must do” list is a mandate to raise taxes. Rather, state policymakers were told to determine what an “adequate” education was and fund it. (Presumably, then legislators could meet the broad guidelines of DeRolph vs. State by deregulating schools in ways that free up resources for more productive uses.)

Also absent from the Supreme Court decision is a blueprint of what constitutes a “thorough and efficient” system of common schools. An efficient school is one that meets its goals at least cost. The “least cost” part of the debate has been missing since DeRolph vs. State was handed down last March.

More than three decades of research has shown that across the board increases in school funding do not increase student achievement. Indeed, over the past twenty years, Ohio has increased per pupil expenditures by 20 percent after adjusting for inflation even though graduation rates have fallen. Proficiency exam scores have been stubbornly stable since the implementation of the statewide tests despite spending increases.

Radical conventional school reforms are also unlikely to yield positive results. In 1990, Kentucky instituted its own system of testing and student evaluation, centralized school finance, and increased state oversight of local districts. Despite a $1.1 billion increase in spending from 1990 to 1995 (a 21% increase after adjusting for inflation), student achievement results on national exams (e.g., National Assessment of Education Progress) have been stagnant.

Successful school finance reform must target efficiency and productivity in the current education system if Ohioans want higher quality public education that is both thorough and efficient. The current approach provides few incentives for stakeholders to tailor their curriculum and schools to the needs of individual students. Poor performance (or good performance) is not disciplined (or rewarded) directly, quickly, thoroughly or efficiently. Strapping dollars to the backs of children through Child-Centered Education creates these incentives for efficiency within public education and can help re-establish the link between funding and student performance.

Samuel R. Staley, Ph.D., is the Vice President for Research at The Buckeye Institute for Public Policy Solutions in Dayton, Ohio.