Senator Sylvia Allen: Win, Win for Schools and Taxpayers!

Senator Sylvia Allen

Senator Sylvia Allen

I am proud of our schools in Arizona.  A number of our high schools are consistently ranked near the top of U.S. studies.  We were one of the first states to create charter schools and our Empowerment Scholarship Accounts allow parents to find the best education option for their children. These two reforms are models being emulated throughout the country.  I personally have toured and seen the excellent achievement of our students and teachers throughout my district.

Friday, October 30, the Legislature passed and the Governor signed an increase of $3.5 billion over the next ten years to our schools.  This will bring new money into our K-12 school system, if voters approve the plan in a special election to be held May 17, 2016.

Part of the funding will come from a new percentage level, 6.9%, distributed to the State Schools Fund from the Permanent Land Endowment Trust Funds (PLETF).  The Arizona Constitution determines the portion of investment earnings the Treasurer must distribute annually to each beneficiary.  Right now annual distributions are set at 2.5% of the average monthly market valuation of the PLETF from the preceding five years.  The voters will be asking to approve the increase above 2.5% in the May election.

Governor Ducey was State Treasurer before being elected Governor, so he understands this trust fund and how it functions.  In 2012 he developed Proposition 118, to move to a fixed rate of 2.5%, instead of a fluctuating rate used at the time.   Voters approved that proposal.

Three years later, the Governor proposed to increase that amount to 6.9%, and the Legislature agreed.  We spent much time in debate and talking to lawyers and staff about the ramifications of the increased percentage.  I am convinced that we have been short changing our schools all these years.  The PLETF is now valued at $5 billion and the consensus of those who voted yes is that we can safely pay this out to our schools and protect the principle of the fund.

Triggers are placed within the law in case we have another major economic downturn. It would require the Directors of the Office of Strategic Planning and Budgeting (OSPB) and the Joint Legislative Budget Committee (JLBC) to jointly notify the Governor, the President of the Senate and Speaker of the House that a reduction to the distribution is necessary to preserve the safety of the capital in the PLETF, if the value of the PLETF has decreased.  At that point we would return to the 2.5%.

This was a complicated issue that took hundreds of hours of work by all concerned, but I am confident that we have made a very good decision in increasing the payout from the State Schools Trust Fund.

The proposal also included increased money for schools from the General Fund.

  • Increases the per pupil amount by $173.26
  • Increases basic state aid by $248,829,400 in FY2016 by increasing the base level per pupil amount
  • Includes additional inflation of $74,394,000 in FY2016
  • Increases the Permanent State School Fund distribution line item by $172,081,000
  • Appropriates to the Superintendent of Public Instruction additional funding for school districts and charter schools of $50 million annually in FY2016 through FY2020
  • Allows flexibility for school districts to budget the additional funding to where they feel it is needed.

None of this will increase taxes for our citizens and is being done within the capacity of what we have now.  

We hear all the time how bad Arizona ranks in school spending, but those rankings can be very misleading. Other states have 95% of land privately owned and is part of the tax base. In Arizona, we are generating revenue from 13% private property. We will never raise revenues to the level of those other states.

Also, Arizona has a high population of those under 18 years of age and a large population of adults over 65 years of age.  In the 18-64 age bracket where the bulk of taxpayers reside, we have a proportionally small population, so again, we will never be able to reach the revenues of other states without significantly increasing taxes.

This ranking propaganda by our critics is designed to pressure taxpayers to fund more into our schools.  We are short changing our teachers and kids when we constantly focus on a ranking instead of results.   Funding is important but does not guarantee a good education that depends on parents, teachers, and, most of all, students.  

I wish to thank the Arizona taxpayer who is willing to give their hard-earned money to better the life of children through our education system in Arizona.


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