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Schools look to first payment on $1.6B ruling

PHOENIX – Kyle McQuaid, chief financial officer for the Roosevelt Unified Elementary School District, said he hopes to see expanded academic enrichment programs next school year, such as after school tutoring services. He also wants the district to lure more highly qualified teachers by offering competitive salaries.

Daniel O’Brien, chief financial officer for the Scottsdale Unified School District, said he hopes his district can beef up special programs such as art and music that were reduced this school year.

Kent Frison, Cave Creek Unified School District‘s associate superintendent of operations and finance, said he wants to be able to increase employees’ salaries to make up for years without providing raises.

After the Arizona Supreme Court found that lawmakers failed to make voter-approved annual inflation adjustments to the funding formula during the Great Recession, a judge ordered the state to provide public schools and immediate $317 million in new funding and a total of $1.6 billion over five years. A hearing set for October is to determine whether the state has to pay back $1.3 billion that the high court said that public schools were shorted over four years.

Gov. Jan Brewer has said the state will appeal the judge’s decision, which likely will put the first payment on hold for now.

But that hasn’t stopped districts from anticipating how they would use their shares of that money.

At the Roosevelt School District, McQuaid expects an additional $850,000 from the first payment, money he said can help the district attract and hire more teachers who rank well in the Arizona Framework for Measuring Educator Effectiveness.

“In everyone’s educational career, there’s that one educator that really made you believe you could do it, and that you were smart enough and good enough to do whatever your dreams landed on,” he said. “We would continue to examine salary structure in order to retract and retain the most highly educated professionals.”

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O’Brien said budget constraints forced the Scottsdale Unified School District to cut 30 positions this school year from art, music and special programs, which were reduced from every day to every other day. The additional $7 million to $8 million he expects from the payment, in addition to an override to be held in November, would help reverse that as well as decrease classes size and increase teacher pay by 2 percent, he said.

“If we get both of those, we could be bringing back arts and then also going down in the classroom and possibly helping with classroom such as classroom raises that they haven’t gotten in prior years, and bringing some of those things back to maintain as much as we can in the classroom,” he said.

Last school year, the Cave Creek Unified School District was able to give teachers raises of 2 percent plus a flat payment of $1,000, while classified staff such as janitors and administrative assistants received raises of 4 percent. But Frison said employees had gone without raises since the 2009-2010 school year and that turnover has increased as a result.

“It negatively affects morale,” he said.

Frison said the additional $1.6 million he expects from the first payment also could help address a predicted $1.3 million budget deficit for next school year.

Chris Thomas, director of legal and policy services at the Arizona School Board Association, said delaying the payment would continue to hurt schools.

“You’re talking about systemic problems,” he said. “You’re talking about increasing class size, salaries being stagnant, programs for students being cut. The teacher shortage is getting worse.”

Andrew Morill, president of the Arizona Education Association, the state’s largest teachers union, said teachers have had to do their jobs with a lack of resources while facing stagnant pay and that districts will be stuck with larger class sizes and reduced enrichment programs.

“What this funding would mean, if the Legislature stopped dragging its feet and acts as soon as possible, it would mean managed class sizes,” Morrill said. “It would mean important instructional resources to help meet high standards, whether it’s Common Core or other standards.”

State Rep. John Kavanagh, R-Fountain Hills, chairman of the House Appropriations Committee, said the state’s rainy day fund can help with the first payment but that the ruling would cut into money intended for other state needs.

“Moving forward, the payments will be extremely difficult and burdensome on the state budget to where it will cause significant cuts elsewhere,” he said.

State Rep. Lela Alston, D-Phoenix, a member of the Appropriations Committee, said she hopes the state makes the payment soon but understands that a structural deficit could result.

“We’re coming out of this recession much more slowly than we had hoped,” she said. “I don’t think that there will be enough dollars to add this bill on top of them, so there will have to be some juggling, some consideration of additional revenue, I would think.”

Thomas said school districts are cautiously optimistic but realistic about how the legal process may play out.

“In a nutshell, this is not the end,” Thomas said. “It’s nowhere near the end, but if you’re looking for a light at the end of the tunnel, it definitely got a little brighter.”

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Alicia Canales/Cronkite News

Kent Frison, Cave Creek Unified School District’s associate superintendent of operations and finance, said he wants to be able to increase employees’ salaries to make up for years without providing raises.

Proposition 301

At the heart of the ruling on school funding is Proposition 301, which Arizona voters approved in 2000 to create an extra 0.6 percent sales tax earmarked for education.

The money goes toward areas such as teacher pay, character education and tutoring.

The court battle stemmed from the state not adjusting the base funding level from the fund after 2010, during the depths of the Great Recession.