LITTLE ROCK — Arkansas schools will receive a nearly $60 million increase in fiscal 2012 if the Legislature enacts the recommendation of the House and Senate education committees.
The committees are responsible for proposing how much money the state needs to add for schools to provide an adequate education to students.
Committee members recommended Monday that the state provide between a 2 percent and 2.4 percent increase to public education to make up for inflation.
The 2011 school year funding is $2.76 billion.
The decision comes two months after a subcommittee recommended a 2.5 percent, or $69 million, increase but backed away from that amount under pressure to wait for later economic numbers from the governor and the state Department of Finance and Administration.
Economic recovery is more sluggish than was expected two months ago, which accounts for the decrease in the recommendation, said Richard Wilson, assistant director of the Bureau of Legislative Research.
A 2002 state Supreme Court ruling requires Arkansas to appropriate sufficient money for schools to provide every student an equitable and adequate education.
This “adequacy” recommendation will go to the Legislature’s budget committee for further evaluation during the 2011 legislative session that starts Jan. 10.
State law requires an annual study to determine how much money is needed.
In August the Joint Adequacy Evaluation Oversight Subcommittee recommended the $69 million. A week later it withdrew that recommendation, and the joint House and Senate Education committees approved the report without a funding recommendation.
At the time, Gov. Mike Beebe said he and his office approached lawmakers with concerns that the committee made its decision quickly and without all the information needed.
One issue at the time was which method of anticipating inflation should be used to determine the adequacy amount. The Bureau of Legislative Research, which reports to the legislative branch, suggested using estimated inflation for consumer products. The Department of Finance and Administration, a part of the executive branch, presented an inflation estimate for fiscal 2012 based on state and local government consumption.
Department of Finance and Administration Director Richard Weiss again presented a different number to lawmakers Monday, asking them to recommend a 1.86 percent increase.
The difference between recommending 1.86 percent or 2 percent is $2 million to $4 million, according to state budget administrator Mike Stormes.
“What I think is really wise is to look at the whole state budget and make an apportionment based on what we have known out there, what we have used in the past,” Weiss said.
Arkansas Code Annotated 10-3-2102 (a) (8) states that the committee must make a funding recommendation “based on need and the amount necessary to provide an adequate educational system, not on the amount of funding available.”
“We’re mandated to fund schools based on need, so we can’t just look at the whole budget and say well we don’t have that much money,” state Rep. Bill Abernathy, D-Mena, said.
He said it was unusual for the department to bring its own recommendation to the committee.
“This is the first time that’s happened,” Abernathy said. “They can do what they think is appropriate and we have open committee meetings. They would just need to be aware of their position in the long run.”
The department helps the governor set the budget recommendation. The Legislature decides what to enact.
Matt DeCample, Beebe’s spokesman, said the governor is glad the committee took the time to get more information before making its decision. He said inflation could change again before the legislature meets.
“Obviously we’re trying to build a recommendation that takes into consideration things like an adequacy number,” De-Cample said. “At this point the recommendation of the adequacy committee is the best indication we have” of what the legislature will do.
The recommendation means the state cannot set the fiscal 2012 or 2013 funding level below 2 percent and still meet the adequacy requirement. It can be reconsidered next fall to account for changes to inflation.
The increase was derived from inflation projections for consumer spending from Moody’s Analytics and IHS Global Insight.
Weiss won’t present the official general-revenue forecast for the next two years until Nov. 10, the date previously established for the forecast to be made.
At least two lawmakers voted against recommending the range.
One of them, Sen. Steve Bryles, D-Blytheville, said setting an adequate funding amount does not guarantee an adequate education.
“It’s a moving target. You have to adequately fund the system but there’s more to it then just funneling money into the system.
“Performance is a consideration as well and the way that the system works its really just a funding mechanism, its just a suggestion of how you’re supposed to run your school and whether the money the state provides gets used to the highest and best use, I’m not sure. The accountability is not really there,” Bryles said.
A state law requires that when revenue declines, education must be funded even at the expense of other aspects of state government, a measure known as “the doomsday law.”
“Yes education is going to be adequately funded but when... families are hurting, employees of state government are all under a freeze, I think the public expects us to be frugal with the dollars,” Bryles said.
The committee also voted to ask the Legislature to change the date the adequacy report is due from Sept. 1 to Nov. 1.
Abernathy said the committee would have more data available by Nov. 1 for its research staff.
School funding takes up the bulk of state money. Lawmakers participating in the fall budget meetings have said they are uncomfortable approving increases for other state agencies until the adequacy funding level is set and they know how much money they have to work with.
Front Section, Pages 1 on 10/26/2010