January 30, 2023

Rural school officials in Hayden and the Colorado area are concerned about the loss of Proposition EE funds, which expire in July.
Dylan Anderson/Steamboat Pilot & Today

As voter-approved nicotine tax dollars near their end, rural school districts across Colorado are wondering where this necessary funding will come from.

With upcoming funding due to expire in July, school leaders and rural school district advocacy groups are attempting to push through voting language that secures funding.

On its list of legislative priorities for 2023, the Colorado Rural Schools Alliance is targeting continued funding unless the education funding formula is revised to ensure equitable school funding.

In 2020, Gov. Jared Polis and Democrats first backed Proposition EE with the intention of building a future for the state for early childhood education.

In addition, some of the revenue from the nicotine tax went to rural school systems while developments to expand early education took place. An incremental funding plan established by Proposition EE called for the money to roll out to preschools in 2023 and then support health programs in 2024.

For many school leaders, the problems associated with adequate and equitable funding for rural schools have become clearer as the expiry date approaches.

The Steamboat Springs School District, Hayden School District, and South Routt School District will all receive money from Proposition EE, but the smaller school systems will suffer greater damage.

Where do problems in financing rural schools come from?

Colorado has a complex history of funding its schools, and data shows that Colorado currently ranks 35th in spending and 31st in funding nationally.

Modern problems with school funding result primarily from a decision by the legislature after the Great Recession to divert money from education funds to other uses. This tactic is now known as the budget stabilization factor or negative factor.

Colorado’s school funding formula accounts for the fact that it costs more to educate students in rural districts by pricing per-student funding based on a variety of factors, such as the size of the district, the cost of living, and whether the district is in a “vulnerable” community. The formula does not take into account the number of students living in poverty or the needs of the students learning English.

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Great Education Colorado executive director Lisa Weil said the problem is that the budget stabilization factor removes money from those adjustments at a flat percentage, which hurts schools that get larger adjustments more.

“The adjustments made to mitigate negative effects of the negative factor don’t necessarily promote fairness,” Weil said.

The budget stabilization factor has compounded the fact that there simply is not enough money for schools, making it worse for many rural schools. Every year the legislature allocates a certain amount to rural schools to compensate. Weil said those one-time dollars provide band-aid solutions and don’t allow superintendents to budget efficiently.

“Superintendents get that money, and there’s no guarantee it’ll be there next year,” Weil said. “School officials are wondering if they will be able to hire a new teacher and maintain their salary.”

For the past two years, that money has come from Proposition EE. With Proposition EE money going to preschools, rural schools now don’t know where the funding will come from next.

What are governors worried about?

In Proposition EE’s first stage, FY2020-21, it raised $25 million for small and large rural school systems. Hayden received $131,000, Steamboat $376,000 and South Routt $101,000.

The high cost of living in Routt County, combined with the rural status of schools with small populations, doesn’t always compel educators to come and work there. This is especially true in the most rural districts of Routt, Hayden and South Routt.

This table from the Colorado Department of Education website shows the funding of the three school systems by type. From left to right, the graphic shows the school districts of Hayden, South Routt and Steamboat Springs.
Colorado Department of Education/Screenshot

“Last year we received $153,000 from Proposition EE,” said Christy Sinner, superintendent of the Hayden School District. “Those are really two full-time jobs that we need to figure out how to absorb or go into deficit spending or try to find grants or other ways to mitigate that so we can keep moving forward and stay competitive. ”

South Routt’s schools use this money to boost salaries and benefits and share similar fears of losing it.

“We use most of Proposition EE’s money on salaries and benefits so we can increase our base salary for teachers to be more competitive and provide decent wages,” said Kirk Henwood, superintendent of the South Routt School District.

South Routt also uses these funds for professional learning, a difficult proposition for rural schools located far from the major cities that house most government education agencies, consultants and professional learning experts.

“Not only is it more difficult to persuade a counselor to travel hours for a professional learning day, it’s also more expensive,” Henwood said. “We pay travel, hotel and subsistence expenses for these professionals, which schools in and around Denver do not have to pay.”

Potential Solutions

Perhaps the most obvious solution would be to do away with the fiscal stabilization factor, something lawmakers are aiming for in the years to come. Still, Weil said that won’t fix the problem.

“Removing the budget stabilization factor would be a nice start, but it wouldn’t address the needs of our districts, especially when it comes to competitive rates for educators,” Weil said.

Another solution could be to keep fighting for additional funding for rural schools, but this would be another temporary solution, as would removing the budget stabilization factor.

Voters must approve the reallocation of funding in favor of rural schools, as required by the taxpayer’s Bill of Rights. Even then, the current financing model with the budget stabilization factor continues to work against rural public schools.

The issue remains on the agenda for Routt County officials.

“Rural schools face funding challenges that make it difficult for them to provide students with essential services that we know are essential to their education, such as after-curricular activities, tutoring and more,” said MP Meghan Lukens, who was a teacher, before being elected to the Colorado House in November. “Legislative efforts are underway to make changes through the school funding formula that will ensure we support our rural schools.”

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