Kansas Is at Breaking Point Over Equitable School Funding : Counties vote to secede in a symbolic protest as lawmakers debate plans to redistribute the property tax wealth.

And now it is Kansas’ turn.

Facing a judge’s warning that portions of the school finance system are unconstitutional, the state of Kansas is grappling with a problem plaguing a record number of states--how to finance rich and poor school districts equally without ensuring across-the-board mediocrity, especially during tight economic times.

The emotional battle in Kansas has stymied state lawmakers, set school districts against each other and sparked a symbolic secession campaign in the southwestern part of the state, where residents fear that reform could mean huge property tax increases.

After 90 days of deliberation, the Legislature adjourned April 11, no closer to a school finance plan than they were in January. They reconvene next week to tackle the issue again.

Court Order

However difficult the task--and however painful it may be to some constituents--lawmakers have no choice but to equalize school funding after a district court judge made an unusual move last October. After 40 school districts filed a total of four lawsuits challenging the state’s school finance formula, Shawnee County District Court Judge Terry Bullock postponed a trial in order to give the Legislature an opportunity to pass a more equitable plan. The judge recently set a June 1 trial date.

In response, the state House of Representatives last month passed a bill typical of legislation enacted in other states--although it does not eliminate property taxes, it creates a funding formula in which they loom less prominent. The bill would put a cap on property taxes while raising income and sales taxes to fund the schools. Property tax revenues would go to the state, which then would distribute funds on a per-pupil basis to each district, $3,625 for each pupil enrolled.

The hope was that the measure not only would provide much-needed relief to areas where property taxes now are considered exorbitant but also would ensure that poorer districts--those with less valuable property to tax--no longer would lag so far behind wealthier districts in education spending.

“It is a pretty good plan because it lowers property taxes in probably 95% of the school districts in Kansas,” said Leland King, director of student services and planning for the Olathe school district near Kansas City, one of the districts that sued the state. He said the formula would, if enacted, supply the Olathe district about the same level of funding it currently gets.

The bill probably will not become law, however. It ran into immediate trouble in the state Senate, which has split in recent weeks into three factions. One camp supports variations of the House plan, in the belief that only that would appease Judge Bullock. Another group wants only to retool the existing school finance plan. And a third faction has rejected both of these ideas, contending that either one would result in unacceptable increases in taxes.

Perhaps the greatest opposition to the House bill has come from the sparsely populated but mineral-rich southwestern part of the state. There, people who already pay high taxes on minerals complain that their tax money would go to fund schools in places like Wichita and Kansas City--cities that they say have helped ensure that they don’t have enough local money for education by freely granting tax exemptions to relocating businesses.

“I think (the property tax) is a very poor measurement of wealth, as far as education is concerned,” said Don Concannon, an attorney from Hugoton, Kan., in the southwestern part of the state, and the instigator of the secession campaign.

Citizens Revolt

In a symbolic protest against high taxes, nine western counties voted overwhelmingly in a non-binding election earlier this month to secede. T-shirts that featured a drawing of a tornado lifting a chunk of the state into the sky sold briskly. “Toto, We’re Not In Kansas Any More,” the shirt read.

“It’s a Midwestern version of the Boston Tea Party, except we don’t have an ocean,” Concannon said. “All we’ve got is wind-blown dust out here. But it’s the same story. . . . If (the Legislature) goes ahead and rams (a tax increase) down their throats, I think the people here would want to go it alone.”

Perhaps nowhere is the stark juxtaposition of rich and poor school districts greater than in Kansas City and its suburbs, on the eastern edge of the state. Overland Park, a suburb that benefits from the presence of many high technology firms and other businesses, is one of the best-financed school districts in the state. It has prospered in large part because of low taxes and the good reputation of its schools. The presence of so many businesses here has kept property taxes low.

Gleaming post-modern office towers, hotels, sprawling shopping malls and wealthy new subdivisions--all taxable properties that add to the community’s wealth--line College Boulevard, which cuts through the center of this sprawling community.

Abutting Overland Park to the west is the blue-collar bedroom community of Olathe, the county seat, where residents pay the highest property tax in the state but where the school district still is strapped for funds. Last year, for example, after the state cut education funding during a fiscal crisis, the district lost $7 million in anticipated state aid, said King, the Olathe school official.

The district trimmed $3 million from the budget by postponing textbook and computer purchases, leaving teaching vacancies unfilled and canceling field trips, but it still had to raise property taxes 25%.

Part of Overland Park lies in the Olathe school district, so King said the district hopes someday to benefit from its neighbor’s wealth, if and when development spreads.

But for now, Olathe’s version of College Boulevard is 135th Street. The Olathe Executive Park sits there, on the eastern edge of town, a meager collection of low-rise office buildings. Across the street sits a new apartment complex, and down the road are several strip shopping centers. Downtown lies further west. The largest buildings there are all owned by the county and hence are not taxable.

Shifting the Burden

Such disparities, and the wide property tax gaps to which they contribute, help fuel sentiments about the inherent unfairness of property taxes--how can Olathe students receive as good an education as those in Overland Park in a system in which funding is based on property wealth?

Facing challenges over school inequities, state after state has remedied the problem by shifting part of the funding burden to the state and away from local property taxes. But John Augenblick, a Denver-based educational consultant who advised Kansas officials in devising the funding plan that is now before the Senate, does not see this as a condemnation of the property tax.

“In the view of the courts it is the states’ responsibility to see that the opportunity is available to all kids, not just those who live in wealthy districts,” he said.

“I wouldn’t conclude that the courts have said that relying on property taxes is unconstitutional or that they necessarily cause problems,” he said. Rather, he said, the message is that reliance on property taxes can lead to unconstitutional school systems if states do not carefully construct and monitor their funding formulas.

Upstart Counties Threaten to Pull Out

How to finance rich and poor school districts equally is confounding many states. A handful of counties in Kansas say education funding reforms would mean that their tax money would go to pay for schools in the state’s biggest cities. In a symbolic protest, nine counties have voted in a non-binding election to secede.

BACKGROUND

Nationwide, nearly half the states are facing court challenges over school funding inequities or already have been ordered to correct inequities--and more lawsuits are expected. With so many challenges, some politicians, education reformers and tax protesters are questioning whether the traditional method of funding education--property taxes--should be done away with altogether. In Georgia, for example, the Legislature is considering a proposal to eliminate the property tax and let the state fund public schools through sales taxes. “A lot of people feel that property taxes have inherent inequities,” said Mary Fulton, a school finance expert with the Education Commission of the States, a nonprofit group that analyzes educational issues. But she added that no one has come up with an alternative funding method that is as stable and productive.