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Details emerge on K-12 settlement deal
By: Hank Stephenson October 26, 2015 , 4:00 pm

According to multiple sources briefed on the matter, the deal that Gov. Doug Ducey, legislative Republican leaders and school groups have reached to end a years-long lawsuit over education funding has five essential components:

-Resetting the K-12 base level funding.
-Modifying how much inflation money is paid each year.
-Implementing economic and budgetary triggers for when the inflation funding would be required.
-Implementing a version of Ducey’s proposal to increase school spending from the state land trust.
-A decade of spending largely focused on increasing teacher pay.
First, the plan would settle the lawsuit by paying out $249 million in the current fiscal year to rest the base level funding to $3,600. A court last year ruled the state owed $336 million to reset the base funding, and the Legislature this year made a partial payment of $74 million.

The deal would absolve lawmakers of the $1.3 billion that were illegally withheld from public schools between 2010 and 2013.

Second, the tentative deal would tweak the voter-approved law that requires annual inflation increases to schools of up to two percent by adding mechanisms to allow lawmakers some wiggle room in future economic downturns. The triggers would exempt lawmakers from increasing funding for inflation if sales tax growth and employment growth are both less than one percent, and would give them the discretion to suspend increases if sales tax growth and employment growth are less than two percent.
The inflation funding requirement would also be suspended – and lawmakers would be allowed to cut education funding by same amount as the previous year’s inflation increase – if total K-12 general fund appropriations reaches 49 percent of the total general fund revenues. If K-12 appropriations reach 50 percent or more of revenues, lawmakers would be allowed to cut education funding by twice the previous year’s inflation increase.

Third, Ducey’s land trust plan would be modified to a flat 6.9 percent distribution for 10 years, as opposed to the governor’s original proposal of 10 percent for the first five years and 5 percent for the following five years. The plan would still pay out roughly $2.2 billion over the 10-year span.
Finally, the plan would commit lawmakers to additional general fund appropriations for education for the next 10 years. Under the settlement, lawmakers would agree to $50 million per year through 2020 and $75 million of additional funding from 2021 through 2026. That money would not be included in the annual calculations for inflation.

In return, plaintiffs in Cave Creek v. DeWit would agree to drop both the back payments and base funding reset portions of the lawsuit.

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Replies to This Discussion

I hope everyone looks at wages in privet sector are declining almost $4,000 per household are the schools willing to take less?

The dirty little secret is that there is about $10 billion of hidden money in the state school districts they don't want us to know about.  They don't need the override + this extra $1.3Billion.  They just want to see if the taxpayers are stupid enough to volunteer to raise their taxes again.

According to the annual report put out by the Arizona State Land Department, which manages the trust lands, the book value of principal in the K-12 permanent trust fund is $2.7 billion dollars. Governor Ducey plans to use no less than $2.2 billion of that sum to pay of the debt to the schools. Once these funds are gone, they cannot be replaced except through a direct tax. Thus we are robbing future generation to benefit current generations. We need to pay our way as we go and the could mean the imposition of a direct tax now. We did that once before with a one percent sales tax. it can be done again.

We need to oppose this theft of state trust funds. Remember what happened to the Social Security and Highway Department Trust funds when congress decided to transfer the existing and future generated taxes into the general fund and then vote each year to provide funds to pay benefits and repair roads? Why will this be any different?

Absolutely.  Why is that such a hard thing for our electeds to learn?  Never ever touch principal and the land he's selling off is the state's principal.  Electeds see "trust" funds as their personal wish list piggy bank.  the future be-damned.

When will enough be enough?  And when will the reality of the fact that there is only so much money to throw at the needs which have been growing at a quantum rate.  (Especially since election of Barack Obama and the ensuing rise of Super- Socialism.) Just as families must live within a budget and the subsequent process of using what money they have, prudently, because they do not have the ability to get more money from whomever they work for.  When do we begin to understand that, that should apply to our school systems as well?  Of course when the resistant mindset begins to prevail with us, what follows is the progressive mantra of, "it's for the children". Really?  What it is for, is not "the children" or 'the teachers" but if you follow the money, you might find that it goes to the highly paid "Edu-crats".                                                                                                                                Until WE take the reigns of how we are governed and how OUR tax money is spent, there be the continuing same old, same old.  Until then I will remain just another over-taxed payer.    

Debbie Lesko is not exactly the brightest bulb in the legislature and AZ Cap Times always has an agenda.  Enough will be enough when they have spent all of other people's money.  No sooner.  maybe we could all get off our duffs and go out and work to elect conservative candidates?  Most people are content to sit and gripe.  So who's to blame here?

Been there, Done that.  Still have the campaign cap.

Me too.  It's all those other people who need to give the couch a cooling off period and start to give their shoes some activity.



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