Oregon lawmakers narrowly OK $8.2 billion K-12 budget

(Update: Adding House Republicans news release)

SALEM, Ore. (AP) – A record $8.2 billion package to fund Oregon’s K-12 public school system cleared the Legislature Tuesday in a 31-28 vote after a lengthy debate in the Oregon House.

The package is up 11 percent from the current biennium and now heads to Gov. Kate Brown. It provides public schools with the majority of their funds, about 70 percent, for the 2017-19 budget.

The next budget cycle begins July 1, meaning educators may need to retroactively adjust their budgets for the upcoming school year accordingly.

For most of the state’s 200 or so districts, it’s enough money to keep current services going. But others like metro Portland’s Beaverton School District say they needed at least another $200 million to avoid scaling back staff and programs.

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News release from Oregon House Democrats:

House Approves $8.2 Billion State School Fund Budget
Without revenue reform, SB 5517 maintains status quo

SALEM -The Oregon House of Representatives approved an $8.2 billion budget for K-12 schools today , maintaining status quo funding for most districts. The vote came after months of work by Democrats to pass a package of proposals to boost and stabilize school funding by reducing government spending, lowering PERS costs, and overhauling the state’s outdated business tax system. Republicans ultimately refused to support a plan that would have dedicated 100 percent of new revenue to Oregon schools, leading to today ‘s vote on Senate Bill 5517 .

The K-12 budget for 2017-19 is an increase from the current budget, but it is $1.7 billion short of funding Oregon’s Quality Education Model. Rep. Barbara Smith Warner (D-Portland), chair of the Joint Ways and Means Subcommittee on Education, said she was hopeful that game-changing investments in Oregon’s public schools would be enough to get House Republicans to negotiate.

“Last week, I made the motion to delay voting on this budget with the hope that our Hail Mary pass would work – that we could find a path to pass both cost containment and long-term revenue reform this session,” Rep. Smith Warner said. “We had all the pieces of the puzzle in hand, we just needed to put them together. But, we couldn’t do it alone, and now here we are.”

Democratic leaders introduced a series of bills this session to contain government spending, set up cost-sharing to reduce PERS expenses going forward, and replace the outdated corporate income tax with a Commercial Activities Tax. Because revenue measures require a three-fifths majority vote, Democrats were hopeful that Republicans would join the compromise. Last week, it became clear that wasn’t going to happen.

After starting the session with a $1.8 billion budget deficit, budget writers worked diligently to prioritize education and ensure that top priorities like full-day kindergarten continue to be funded. While SB 5517 protects most critical programs, it doesn’t make the significant investments Oregon schools need to rise above inadequate funding and subpar outcomes.

“We had our chance this session, a chance for real tax reform partnered with cost containment and serious investments, 100 percent invested in education from cradle to career,” said Rep. Janeen Sollman (D-Hillsboro), a former Hillsboro School Board member. “We could not come together to make it happen this session and that is very disappointing.”

The Oregon Legislative Assembly is constitutionally required to pass a balanced budget before July 10 .

Rep. Smith Warner said she hoped the work done this session would be a starting place for discussions so that future generations of Oregon children have the schools that they deserve.

“I believe we need to keep fighting for reforms that transform our education budget for decades to come,” Rep. Smith Warner added. “My hope is that today is the wakeup call we need to build for the future, and that we’ll spend the next two years working on structural reforms that will finally stabilize our K-12 budgets.”

The budget now goes to Governor Kate Brown.

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Release from Rep. Knute Buehler, R-Bend

REP. KNUTE BUEHLER STANDS UP FOR BETTER SCHOOLS AND MORE FUNDING FOR CLASSROOMS

Salem, OR – Representative Knute Buehler issued the following statement regarding the K-12 budget that passed the Oregon House Chamber today :

“I’m voting against this education budget because it is too small, not because it is too big. And because it fails, once again, to address Oregon’s crisis in education quality and academic achievement.

“In choosing not to reform the rising pension and health care costs that are eating alive every school budget in Oregon, the Governor and majority party are denying Oregon school kids smaller class sizes, longer school years and valuable academic programs and activities. And in choosing to accept lower standards for achievement, accountability, and attendance, the Governor and majority party ensure that Oregon remains near the bottom in the nation in education quality and high school graduations.”

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Release from Oregon House Republicans:

House Republicans stand firm against K-12 budget that shortchanges Oregon students

Absent structural spending reforms, record budget will do little to improve classroom outcomes

Salem, Ore. – House Republicans stood up for students, parents and teachers today by voting no on a K-12 education budget that shortchanges Oregon schools. House Republicans argued that absent a serious effort to address runaway cost drivers like PERS and government employee healthcare costs, even an 11% increase in funding is inadequate to fully fund our state’s education system. School districts around the state have already suggested the underfunded budget approved by Democratic leaders is likely to result in larger classes and fewer school days.

“As a school board member and committed advocate for our students, I know that this K-12 budget is simply not enough to prevent painful cuts around the state,” said Rep. Mark Johnson (R-Hood River), who serves on the Hood River County School Board. “While my school district is going to be able to squeak by this year by dipping into reserve accounts, others will not be so lucky. Our cost drivers, including PERS and healthcare costs, are decimating our budgets. Our schools will never be fully funded as long as the cost of funding education continues to exceed the growth of revenue.”

According to estimates by Milliman , the state’s actuary, school districts will see their PERS costs jump by $335 million over the next two years, an amount that could otherwise be used to hire new teachers and invest in classrooms. Lawmakers have introduced a number of bills meant to provide schools with relief from PERS, though none have received an opportunity to advance.

Republicans also cited escalating government employee health benefit costs as a reason why the K-12 budget approved by Democratic leaders is inadequate. A recent analysis by The Register-Guard showed that Oregon has among the highest government employee health benefit costs on the West Coast. At an average of $12,204 a year per employee, Oregon taxpayers foot the bill for health plans that are nearly $3,000 more expensive than those in California and Washington. Much like PERS-reform bills, efforts to rein the cost of employee benefits have been largely ignored.

“Republicans have introduced a number of bills that would address runaway costs as they relate to PERS and healthcare compensation,” said Representative Jodi Hack (R-Salem). “Few of these have received serious consideration from the majority party, and not one has received a vote. I am absolutely disheartened that this budget is apparently the best that we could do. At the end of the day, if we would have acted on our conversations about cost containment early on, we could have done better for our kids. I have always said that if you sit around a table and you put kids first, you will not fail. I’m sad to say we did not put our students first in this process.”

Republicans pointed to the latest statistics released by the nonpartisan National Education Association for further evidence that the state is not doing enough to ensure that taxpayer dollars are spent in ways that benefit students in the classroom. According to the NEA, Oregon is projected to fund education on a per-student basis that is well above the national average in 2017. At $12,161, Oregon ranks 18th among the states, and higher than any of our West Coast neighbors. The per-student funding ranking stands in stark contrast to the state’s high school graduation rate, which consistently ranks as one of the lowest in the nation.

“The simple fact is even a record K-12 budget is not enough to keep up with rapidly rising cost drivers,” said House Republican Leader Mike McLane (R-Powell Butte). “Democratic leadership has failed our children by refusing to prioritize and pass meaningful reforms to the cost of PERS and runaway benefits. Until we get serious about addressing these unsustainable costs, we will never be able to make the kind of targeted investments that will produce positive outcomes for our kids.”

The K-12 education budget passed the House on a 31-28 vote, with four Democrats joining all Republicans in opposing the bill. House Republicans remain hopeful that Democratic leaders will allow serious cost containment bills to move forward before the end of the legislative session so that additional resources may be redirected to support schools.