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Wichita school fund balances again an issue

The issue of school fund balances in Wichita and Kansas is a serious issue that deserves discussion. At the same time, we need to make sure we don’t lose sight of Kansas school issues that are even more important. But school officials need to be held accountable for their deception of the public, most notably through straw man arguments.

When Dr. Walt Chappell, an elected member of the Kansas State Board of Education, used a slot on the public agenda to address the board of USD 259, the Wichita public school district, his shabby treatment by the board was one issue. But the more important issue is the substance of Chappell’s remarks, and the reaction by school district officials.

Chappell asked the board to use money socked away in various fund balances to balance the budget. In his written remarks, he wrote: “The Wichita school board does not need to lay off teachers, raise property taxes or cut instructional programs to balance next year’s budget.”

The Wichita school district, like many across the state, has unused balances in a variety of funds. Some of these funds, by law, must be used only for certain purposes. But this year the Kansas Legislature passed a law that gives school districts greater flexibility in using these fund balances.

Even through the unused fund balances have been restricted to certain uses, school districts have always been able to “spend” them by simply not transferring so much to the funds. But there’s been an incentive to make transfers to these funds, as once the money is in certain funds, school districts can hoard it.

In his response to Chappell, and also in a recent letter to the Wichita Eagle, board member Lynn Rogers tried to explain why these fund balances are not the solution that Chappell and others say they are. His primary argument is that fund balances are needed for cash management purposes. An example: “Special education is a clear example of why having a fund balance is good business practice. We ended the past fiscal year with $12.5 million in the special education fund. Special education salaries are about $12.1 million between July 1 and the next state aid payment received in October.”

Everyone can understand that. The need for fund balances to manage cashflow is legitimate and not part of the argument of those who advocate using fund balances for other purposes. For Rogers to use this as part of his argument is an example of a straw man argument. In using this fallacy, Rogers replaces his opponent’s argument with a “superficially similar yet unequivalent proposition.” Then he refutes it. The appearance, if you’re not watching carefully, is that Rogers has refuted the original argument. But he hasn’t.

What Rogers and other school spending advocates don’t talk about is the rise in the fund balances over years. In a letter to the Wichita Eagle George Pearson wrote that Rogers provided “accurate but incomplete information” on the school fund balances. Pearson explained: “USD 259 had $45 million in those funds at the beginning of this fiscal year. Five years ago, those balances were $31 million. The buildup in those balances comes from state and local tax dollars received in prior years that haven’t been spent. SB 111 authorizes USD 259 to use about $16 million in any manner the district chooses — ironically, about the same amount it collected but didn’t spend over the past five years.”

This is what the arguments of Rogers and the school spending lobby don’t explain: Why do the fund balances rise year after year, and rise faster than the overall level of school spending? The only explanation is that money is added to the funds faster than it is spent, year after year. Schools have not spent all the money we’ve sent them — despite their constant poor-mouthing.

This issue, while important, is not the most serious issue facing Wichita and Kansas schools. For example, most people would be surprised — and shocked — to learn that only 26 percent of Kansas students that take the ACT test are ready for college-level coursework in all four areas that ACT considers. (See Most Kansas students not ready for college.) While this result was slightly better than the national average, it means that three-fourths of Kansas high school graduates need to take one or more remedial college courses.

It is important that citizens understand the issue of the unspent fund balances. It’s also important that they are aware of the refusal of school districts and school spending advocates to deal forthrightly with the public on this issue. It provides insight into the nature of our public schools, and why reform is so difficult.

For more articles on the fund balances, click on Kansas school fund balances. Chappell’s written remarks are below (use the toolbar to zoom or for a full-screen view), and video of his appearance before the Wichita school board follows that.

Wichita, Kansas (USD 259) School Budget Recommendations

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One Comment

  1. fromthesidelines July 12, 2011

    The lousy treatment by the school board of a fellow elected official, in this case Mr. Chappell, is a demonstration of the contempt this board holds the public. If anyone questions this board/staff, this hostile response is the regular response. How sad.

    This is another reason why we need to eliminate the power of the government school monopoly. Educational consumers need the power to chose, just like they do when buying other commodities.

    I was pleasantly surprised to see USD 259 finally put some of their surplus land, the roughly 50 acres at the se corner of 13th St. N. and Tyler Rd. on the market. The district should have looked at selling these assets a long time ago. Sadly, in today’s depression level real estate market, the district won’t generate the money that a sale a held in 2007 would have generated.

    I doubt that this school board would have figured out that selling excess assets is another way to generate funds. Someone must have applied leverage to accomplish this remarkable achievement.

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