John Locke Update / Research Brief

State Budget 2018: K-12 Education

posted on in Education, Education (PreK-12), Fiscal Insight, Spending & Taxes
Featured Image

Unphased by the recent teacher walkout, Republican lawmakers continue to invest in their policy priorities, including a fifth consecutive raise for teachers, raises for principals, expanded performance pay programs, new school safety initiatives, and additional funding for children with special needs.

Lindsay Marchello of Carolina Journal does a great job of summarizing the various components of the education budget, so I will not replicate the list here.  Among the provisions in the budget bill, however, a few are worth noting.

  • Total K-12 education spending will increase by around $500 million.
  • Teachers will receive a 6.5 percent average salary increase, which is projected to bring the state’s average teacher salary to $53,700. Lawmakers added a $385 bonus for certain veteran teachers and $22 million for fourth- and fifth-grade reading teachers and fourth- to eighth-grade math teachers who meet specific performance benchmarks.
  • Principals will receive a 6.9 percent salary increase and may qualify for performance-based bonuses of up to $20,000.
  • Other school employees will be awarded a 2 percent pay raise.
  • The budget includes nearly $74 million for textbooks and $35 million for school safety initiatives.
  • Budget writers increased supplemental funding of children with disabilities from $4,125.27 to $4,442.34 per child.
  • Up to $242 million in the N.C. Education Lottery and the General Fund dollars will be available for school construction, renovation, and repair.
  • An additional $3 million for the Children with Disabilities Scholarship Grant will be used to reduce the voucher program’s waitlist.
  • Cities will be allowed to allocate property tax and other unrestricted revenues to district, laboratory, charter, and regional schools. Cities are also permitted to allocate dollars to Innovative School District schools.

Thanks to prudent budgeting and generally sound governing, this massive increase in state education spending will not necessitate higher taxes or significant cuts elsewhere in the budget.  But there are costs involved.

For example, local governments will bear some of the cost for increased spending on teacher, administrator, and staff salaries and benefits.  The state allocates funding to districts for personnel, but school boards often use local dollars to add positions.  (The wisdom of doing so is a debate for another time.)  Local dollars fund a significant number of school jobs statewide.  Of the 28,300 district employees paid using local funds this year, over 6,000 are teachers, 1,800 are administrators, and nearly 20,500 are support or professional staff.

When state lawmakers mandate increases in employee compensation, school districts must do the same for employees paid with local dollars.  This may lead to property tax increases or reductions in staff through attrition or other means.  Of course, the burden is greater on districts located in counties with meager tax bases or declining property and sales tax revenue.

The fiscal implications of the state budget for county commissions are evident.  Perhaps less clear are the academic consequences of the state budget for children.

On one hand, the state budget recognizes that learning matters.  Bonuses for top principals and reading and math teachers, among others, depend on measures of student achievement, mostly growth or “value-added” scores.  Rewarding our top administrators and teachers is a sound strategy for ensuring that they remain in North Carolina classrooms.

On the other hand, the state remains tied to a statewide teacher salary schedule that, for more than a century, has paid teachers based on experience and credentials.  The problem with this arrangement is that it allows underperforming teachers to receive pay raises that are identical to their high-performing colleagues, thereby creating an incentive for the former to stay and the latter to leave.  Student achievement suffers as a result.

Despite its flaws, I believe that the K-12 education budget moves the state in the right direction.  Any further progress will depend on the outcome of November elections.

As Vice President for Research, Terry oversees the research team’s writing and analysis across the spectrum of public policy issues. He specializes in pre-K-12 education. Before joining the Locke Foundation, he worked as the program assistant for the Child Welfare… ...

Donate Today

About John Locke Foundation

We are North Carolina’s Most Trusted and Influential Source of Common Sense. The John Locke Foundation was created in 1990 as an independent, nonprofit think tank that would work “for truth, for freedom, and for the future of North Carolina.” The Foundation is named for John Locke (1632-1704), an English philosopher whose writings inspired Thomas Jefferson and the other Founders.

The John Locke Foundation is a 501(c)(3) research institute and is funded solely from voluntary contributions from individuals, corporations, and charitable foundations.