by James C. Sherlock

We have been discussing public school policy often, and it merits the attention.

So to provide background, I prepared a spreadsheet to help us all understand school finance in Virginia. I used the school year 2019-20.

It is both important and interesting and certainly raises questions, primarily about state contributions.

The state computes an index of local ability to pay that is supposed to guide state contributions to each school district, but the 2019 – 20 data complied in the spreadsheet do not seem to support that contention.

I am sure VDOE has an explanation, but it would be worth hearing.

Context

First a few contextual facts.

Mississippi is the poorest state in the union.

Thirty-four of Virginia’s schools districts are operated by jurisdictions whose median household income was below that of Mississippi in 2019.

The State of Mississippi in 2017 – 18 paid its teachers nearly $45,000 per year on average.  Note that in the teacher average pay column of the spreadsheet, 16 Virginia jurisdictions paid their teachers less than that in 2019-20.

But some good news.

Forty of Virginia’s school districts paid teachers more than the local median household income; seventeen of those paid at least 10% more.

The city of Salem paid its teachers 150% of its median household income.

If Loudoun had done what Salem did with teacher pay, the average Loudoun teacher would have made over $210,000 annually.

One. helpful note from VDOE:

“Any division with a calculated composite index that exceeds .8000 is considered as having an index of .8000”.

Translation, even if a jurisdiction has an even greater ability to pay than that, it gets education funding as if it was stuck at .8000.  Cool if you live in Arlington, Falls Church or Surry County.

But I digress.

The Composite Index of Local Ability to Pay and State Contributions to Education

The Composite Index is calculated using three indicators of a locality’s ability-to-pay: True value of real property (weighted 50 percent) Adjusted gross income (weighted 40 percent) Taxable retail sales (weighted 10 percent).  It is the official guideline for the distribution of state education funds.

One can see the effect on the index of taxable real property.  For example, Surry County, with a median household income of under $58,000 (state average over $76,000) is given the maximum composite index of ability to pay (composite index) because of the taxes paid by the nuclear power plant in that jurisdiction.

But the index itself fails to correlate with the real distribution of state funds in 2018 – 20.  Sort the spreadsheet by column D and you will see what I mean in the state contribution column.

VDOE writes

“Each locality’s index is adjusted to maintain an overall statewide local share of 45 percent and an overall state share of 55 percent.”

Looking at the actual state funds distributed to each locality, I am not sure exactly what that means.

The 2019 – 20 state funds distribution recorded in the spreadsheet from VDOE data do not correlate with the corresponding index values.

Maybe there is something I missed.

The case of state education funding to Sussex County and Tazewell County

Sussex

Sussex County, with a .3492 ability to pay, received $8,191 per student from the state and provided nearly $8,000 per student locally.

That plus its federal contribution raised Sussex County’s total per pupil financial support to over $17,500 per student, putting it the top ten jurisdictions in the state by that measure, ranking just ahead of Fairfax County.

Of those jurisdictions with it in the top ten in total per-pupil financial support, Sussex County with its .35 index is the only one with an ability to pay index below .65.

From Sussex County’s index value the state apparently did not expect Sussex would or could pay $8,000 per student from its own local tax funds.

Sussex County median household income was $49,487, far below the state average of over $76,000.

Tazewell

Yet Tazewell County, with a composite index of .2575, was provided only $6,572 per student by the state.

The state index, if applied, would have provided Tazewell considerably more state money than Sussex.

Tazewell added almost $2,400 per student in local funds, and with its federal contribution had just over $10,000 per student to fund its schools compared to Sussex’ $17,500.

Tazewell median household income was $42,099.

Maybe someone can explain how the state funding train left the tracks in that comparison, but I cannot.

How accurate are the indices?

The indices are updated every year, yet for some counties the calculations appear to yield strange numbers.  Download the calculator here.

The most prominent examples are Stafford and Prince William.  Stafford was awarded an index of .35 and Prince William a .38, indicating low ability to pay.

Yet those two counties are 5th and 6th in median household income in the entire state now, each around $110,000.

Mecklenburg County, with an ability to pay index of .40, higher than Stafford and Prince William, has a median household income of just over $43,000.

Check out Loudoun.  Ability to pay index of .5466 puts it below Charlottesville with 40% of Loudoun’s median household income and a poverty rate of 24%.

The others

There are more than 130 school districts in Virginia. Each of them is listed.

Remember, this is about the financing of public education, not educational policy or the outcomes of that education. That is a long list of different discussions.

There are six segments to the spreadsheet. All of the data are from 2019-20.

The first two segments are:

• Census Bureau income and poverty figures by jurisdiction;
• Virginia composite index of local ability to pay on which state contributions to schools were to be based. I am sure there is some small print, but that is the headline;

The others provide data from VDOE that include

• School financial support data broken into local, state and federal dollars contributed per student per jurisdiction and then summed to define total per-pupil financial support;
• Percentage of school division expenditures on instruction;
• Pupil and teacher data that includes totals and ratios, and average teacher salaries;
• teacher average salary as a percentage of the median household income in each jurisdiction.

Generally speaking, dark red cells are the worst (high or low) and dark green cells the best (high or low) depending on the subject of each column.

Size is interesting

One exception to that rule is in the Pupils all grades column. I used cell coloring to provide some perspective on the size of the districts.

Each of the school division pupil numbers in yellow in that column reflect that the entire school division in 2019-20 had fewer pupils than did Lake Braddock Secondary School in Fairfax County.

Teachers in the middle class

The other is a column into which I placed a formula that calculated the average teacher’s salary as a percentage of the median household income in that jurisdiction.

Just thought it an interesting figure.

Bottom line

So look at whatever school district that interests you. If there is a lot of green, that is good. A lot of red and yellow, maybe not.

Perhaps the VDOE can explain the anomalies in the distribution of state funds.

They are likely able to do it, but they certainly should.

State contributions represent the Commonwealth’s attempt to implement the “quality education” guaranteed in the Virginia Constitution Article VIII.

They are worth getting right.