Highlights of the Education Budget

• One billion in new education spending over two year budget cycle
• Pay raises account for most of new spending
• School Choice expanded with increased funding for Opportunity Scholarship Program and creation of Personal Education Scholarship Accounts.

 

House and Senate conferees have agreed on a new state budget. The new agreement, reached yesterday, raises the initial $22.9 billion ceiling to just over $23 billion. Each chamber is expected to vote on the budget later this week.  If Democratic Gov. Roy Cooper signs the budget, we may have something that hasn’t happened in a long time: a state budget before the end of the fiscal year.

For a review of general budget highlights see here.

Since education spending is approximately 57 percent of state spending, this article reviews notable education budget items for K-12 public schools, community colleges and the UNC System.

K-12 Public Education

• The 2017-18 budget represents increases of $307 million in 2017-18 (3.5 percent) and $701 million in 2018-19 (8 percent over FY 2018-19) over the respective baseline figures; in other words, over $1 billion in new spending over two years
• Average 3.3 percent raises for teachers (Cost: $101 million FY2017-18, $372 million in FY2018-19)
• $385 bonus for teachers with 25 years of experience
• Math and reading performance bonus: $2,150 bonuses to top 25 percent of teachers statewide, within each LEA, and based on EVAAS value added scores (FY 2017-18: $25.3 million)
• Third-grade Read-to-Achieve, Advanced Placement and career and technical education bonus programs (FY2018-19, $14.9 million)
• Salary increases for principals and assistant principals (Cost: FY2017-18: $35 million; FY2018-19: $40.5 million)
• Across-the-board salary increases of $1,000 for all LEA employees (Cost: $61.5 million in both years)
• 1 percent cost-of-living increase for retirees in the Teachers and State Employees Retirement System (TSERS) (Cost: FY2017-18: $47.7 million; FY2018-19: $126 million)
• Growth in Enrollment: Provides $31.8 million each of the next two years to pay for 9,120 more students
• Books: Adds $11.8 million for classroom materials and digital textbooks. Net appropriation now $66.8 million in FY 2017-18, $55 million in FY 2018-19
• Business system modernization. Allows schools to integrate payroll and HR functions in uniform system (Cost: $19 million FY2017-18; $10 million FY2018-19)
• DPI Audit: $1 million for a third party to conduct a business and cross-functional audit of DPI’s operating budget
• Advanced teaching roles: $7 million for pilot project to create organizational structure and compensation models that support allowing classroom teachers to take on advanced roles
• Grants: $2.5 million to various organizations ranging from Eastern North Carolina STEM to Haywood County Learning Center

Notable Reductions:

• NC DPI Reductions: Reduces DPI operating funds by 6.2 percent in FY2017-18 and 13.9 percent in FY2018-19
• State Board of Education: Eliminates position of Associate State Superintendent (Savings: $188,000 each year of biennium)
• NC Department of Public Instruction position reduction (Savings: $1,085,516) Positions eliminated: Chief Performance Officer, Research Associate, Education Program Director, Education Consultant III, Accountant, Education Diagnostician, Education/Development Aide II, Education/Development Aide II, Business Technology Analyst, Digital Learning Plan Coordinator, Director of External Meetings and Special Products, Education Consultant II
• Lottery Funding: Reduces funding for noninstructional support — $11.6 million in FY2017-18 and $13.6 million in FY2018-19. Will now be funded through lottery receipts
• Central Office Allotment: Reduction of $7 million for central office administration in local school districts

BudgFinal

Community Colleges

• Adds $53 million in new spending in FY2017-18, an increase of 5 percent over the previous year, and adds $73 million in FY 2018-19, an increase of 6.8 percent
• Salary increases – Provides $22 million in each of the next two years for salary increases for community college personnel
• Cost-of-living adjustment – Provides $7.4 million in FY 2017-18 and $19.6 million in FY 2018-19 for 1 percent cost-of-living adjustment for state retiree pension payments
• Enrollment growth – Adds $4.9 million in each of the following two years to account for 803 new students

 

UNC System

• Adds $92 million in FY17-18, a 3.2 percent increase over the previous year; in 2018-19, the budget adds $116 million in additional funding, a 4 percent increase in funding
• Opportunity Scholarship Program: Funding increased by $20 million in FY2017-18 and $30 million in FY2018-19. Total funding for program in FY2017-18 is $44.8 million
• Salary Increases: Across-the-board, $1,000 salary increases for all employees under State Human Resources Act. Cost: $40.5 million in FY2017-18, the same in FY2018-19
• Cost-of-Living Adjustment: 1 Percent COLA for state retiree pensions, $9.1 million in FY FY17-18 and $24.1 million in FY2018-19
• Management Flexibility Reduction: $7 million for UNC in FY2018-19
• Stabilization Funds: $2.8 million for Elizabeth City State University to stabilize enrollment and start new programs in aviation science. FY2018-19: $2.1 million.
• Teaching Fellows: Provides $450,000 in FY 2017-18 and $6 million in FY 2018-19 to restart forgiveable loan program for students wanting to teach in STEM areas, special education and teacher licensure. Students may receive up to $8,250 a year for tuition, fees and books. Loans may be forgiven if they teach in North Carolina elementary or high school.
• Personal Education Savings Accounts: Provides $450,000 in FY2017-18 to develop Personal Education Savings Account program for special needs students and dependents of active military personnel. Parents can receive accounts valued at up to $9,000. Funding for FY 2018-19 is $3 million. Recipients may also be eligible to use funds in conjunction with other scholarship programs such as special needs scholarship or Opportunity Scholarship Program.
• NCSSM Scholarship: Provides one-year tuition grant for students of North Carolina School of Math and Science who enroll in UNC institutions. Cost: $1.5 million in FY 2017-18.

 

Overall the 2017-18 budget represents more spending on staff salaries, largely for teachers, staff and administrators. The increases continue the state’s commitment to reach an average teacher salary of $55,000 by 2020. There are also bonuses for teachers who reach performance goals.

There are personnel reductions at NC DPI to allow Superintendent Mark Johnson to hire staff. Community colleges and the UNC System both received modest to significant budget increases as well.

This budget feeds the machinery of state government. However, the budget also reflects a growing expansion to the Opportunity Scholarship Program ($20 million) and the development of Personal Education Savings Accounts for special needs and military families.

Such steps are encouraging to those who believe the best way to educate our children is to provide them access to quality educational options – be they public, private or in the home – to all North Carolinians.

The expansion of school choice may be one of the few reasons to stomach this budget.

There is a lot of medicine in the budget document. Will the prescription work? Only time will tell.