out of hand we apply too late the remedies which then might have effected a cure.
- Winston Churchill
Nothing I heard in the state’s testimony that morning provided any sense of relief regarding that concern. As with the 2014 hearing, the state’s defense continued to exaggerate past accomplishments, minimized the scale of what remains to be done, and over-estimated legislative commitment to creating the funding system required by the constitution. At some point, though, whether or not the solution is complete, the court will relinquish its jurisdiction. What happens then?
A big part of why Washington’s education funding system went from near the top among the states to near the bottom during that past four decades, is the powerful pressure exerted on the Legislature by anti-tax forces. This isn’t just an opposition to new taxes because as the graph in Figure 1 indicates, we’re nowhere near the level of state revenue as a percent income that we were two decades ago.
In a 2014 presentation on this topic, Office of Financial Management Director David Schumacher said this decline represented a loss of $15 billion in revenue for the biennium. That would be more than enough to address the state’s education funding shortfall.
Some of the state revenue decline, reflected in Figure 1, is due to a tax system that is overly dependent on sales tax, which is a declining revenue source. Much of the decline, however, can be traced to the pressure anti-tax forces have exerted on our legislators. One response to this pressure is the Legislature’s inclination to provide an increasing number of tax breaks. As the graph in Figure 2 demonstrates, the number of exemptions has grown significantly at the same time our state revenues have declined.
According to a 2016 report by the Washington Department of Revenue, the estimated net value of these exemptions, if repealed, is $30.1 billion for the 2017-19 biennium. That represents 92% of the projected $32.6 billion in revenue that would be generated by these state tax sources. In other words, the Legislature has given away nearly half of the potential revenue from these sources. A fraction of these tax-break resources would be enough for the state to fully fund basic education.
The net effect of this downward pressure on revenue can be seen in Figure 3, produced by OSPI. The bottom trend line in that infographic reflects the work of Quality Counts, a compilation of state-level education data gathered by Education Week. The Quality Counts information adjusts the National Center for Education Statistics (NCES) data used in the upper line to reflect cost-of-living differences between the states. That method provides relevant context information related to the impact of education dollars. The numbers on both lines reflect Washington’s ranking among the states in its per student funding for any given year. Regarding those rankings, it’s worth noting that in 2004-05 Washington reached a low point of 45th in the nation using the Quality Counts data.
The high point in the trend line shown in Figure 3, is the year after the Washington Supreme Court affirmed the Doran decision. That landmark decision gave the state a much more primary role in funding our public schools. Given the trend since that decision, it appears to be a role legislators have been unable or unwilling to fulfill. As the historical graph in Figure 4 demonstrates, local levy funding as a percent of total school revenue made a steep decline in 1978 following the Doran Decision, but then in 1981 that percentage began to steadily increase up to current levels.
To be clear, the steady increase reflected in Figure 4 didn’t occur because of any legal action that nullified Doran’s finding regarding the state’s responsibility to fully fund basic education. It happened because countless legislators over the past four decades found it more palatable to raise the levy lid than to raise the taxes necessary to fully fund our schools.
During that time, local voters in many communities have supported dramatic increases in their local school levies. As that local revenue source grew, many school districts increasingly used levy funds to cover the shortfall in state funding. Because of the wide disparity in property values, other districts weren't able to provide their students with similar support. That trend is what led to the McCleary decision.
As we near the end of this decade-long legal battle, I find myself wondering about the future. In addition to the Winston Churchill quote listed above, he is also credited with saying, “Those who fail to learn from history are doomed to repeat it.”
Hopefully, after the current legal proceedings have ended, Washington’s leaders will be committed to avoiding a repeat of this erosion in the constitutional principles clarified by the McCleary and Doran decisions. Unfortunately, hoping for that commitment doesn’t provide much confidence that the errors of the past won’t be repeated. It will be up to the state’s next generation of leaders to remain vigilant so that every child realizes the promise of an amply funded education as guaranteed by our state constitution.