The Budget in One Word: Catastrophe

Maybe it was a coincidence. Three things were happening at about the same time, around 1:00 this afternoon.

• The State Board of Education was preparing for a special meeting with one agenda item: addressing the three percent cut to state aid.
• Several curious parties – including quite a few district superintendents – were arriving to hear the discussion about these cuts first hand.
• The credit union in the Sequoyah Building – which is directly to the south of the Hodge Building (which houses the SDE) – was being robbed.

I’m pretty sure this was not an elaborate scheme to stabilize school funding. In any case, the article listed the suspect as 6’2” and wearing a red-hooded sweatshirt. Maybe it was this guy:

The timing made for extra tension and security inside the Hodge Building, and that says quite a bit. We were already on edge because Superintendent Hofmeister was there to announce a $46.7 million funding cut:

State Board of Education makes required 3% budget cut to preK-12 in wake of revenue failure

OKLAHOMA CITY (Jan. 7, 2016) — In the wake of a revenue failure affecting all of Oklahoma state government, the State Board of Education today approved a required 3-percent reduction in a $46.7 million funding cut for preK-12 public education. The reduction impacts the remaining six months of Fiscal Year 2016, which ends June 30.

“There is no denying that this cut poses serious challenges for school districts during a time in which every dollar already is precious, and not all districts will be affected the same way. But the State Board of Education and Oklahoma State Department of Education have addressed the required cuts as fairly and judiciously as possible, while attempting to minimize student impact,” said State Superintendent of Public Instruction Joy Hofmeister.

While the cuts are certain to have a significant effect on Oklahoma’s 550-plus school districts (a figure that includes charters and co-ops), Hofmeister and her fellow board members were able to soften the blow by transferring $4.6 million from the Public School Activities appropriation to the State Aid Funding Formula that provides the bulk of money to school districts.

Each line item in School Activities took a minimum 3-percent cut, which includes such programs as alternative education, Teach for America, the early childhood initiative, Sooner Start and the Oklahoma Arts Institute. Four line items are contributing well above 3 percent to cushion a hit on the funding formula. In addition to the transferal, the board approved a $3.9 million cut in the School Activities appropriation.

After the transferal, the funding formula — also known as Financial Support for Public Schools — takes a $25 million funding cut.

Flexible Benefits Allowance funding to districts will be lessened by $12.4 million, a 3-percent cut.

The cuts will be reflected in the next six monthly payments to school districts.

All in all, the SDE staff did the best they could with the completely predictable, preventable budget collapse that the state dealt them. Three percent became 2.53% because of some funds under the activities budget that they were able to shift.

It is also important to note that state aid to schools comes from two buckets of money. First is what’s known as the HB 1017 fund, which is a dedicated revenue stream created in statute in 1990. At this time, the state hasn’t declared a revenue failure for the 1017 fund. That’s why the top line shows a 1.33% cut to state aid. Keep in mind, however, that this could change.

The easy way out would have been simply cutting each line by three percent. I can assure you that the Board and those of us in the audience appreciated the decision to protect the formula as much as possible. Still, as I look down the spreadsheet, I see some money that is simply wasted. There’s $8 million for ACE Remediation and $4.5 million for testing. In case you’re interested, that’s about the cut to the Flexible Benefit Allowance – you know, our health insurance.

After today’s meeting, I feel two things. First, I’m grateful that Hofmeister’s staff did what they could to soften the blow. Second, I’m furious. Then again, I’ve been that way since late November when it became obvious we’d reach this point.

I don’t know how familiar you are with catastrophe theory. Essentially, the idea is that slight changes to variables add up and move a system from a state of balance to the cusp of disaster.

It can be a miscalculation that eliminates the stable state. It can be happenstance. It can be direct influence from an outside actor. It can be negligence. Eventually, the instability of the system causes a collapse. It seems sudden, but it’s not.

“How did you go broke?” “Two ways. Gradually, then suddenly.” – Ernest Hemingway, The Sun Also Rises

Maybe that image and explanation are too highbrow. Let me try it a different way.

We as a state were certain that we could tax cut our way to prosperity. That’s why we (and I’m using the royal we here) voted for SQ 766. That’s why the Legislature and Governor won’t halt the tax cuts that net average citizens about $30 and cripple critical state programs.

What could possibly go wrong?

It’s also what Malcolm Gladwell would refer to as a tipping point. Then again, not all tipping points are bad. He also explains:

If you want to bring a fundamental change in people’s belief and behavior…you need to create a community around them, where those new beliefs can be practiced and expressed and nurtured.

That’s pretty much what we’ve done with #oklaed over the last three years. As this spring progresses, as we talk to our elected leaders – who may be tempted to throw their hands up and act helpless – we have to remember that they brought us to this tipping point, this catastrophe, this funding disaster. This was a choice that was made gradually, with the outcomes realized suddenly.

Pretending differently is also a choice. Let’s not allow anyone to do so in our presence.