Republican State Senator Promotes Raiding Of School Savings Account Republican State Senator sides with Teacher's Union against School Board Associa

      Web Version   Preferences   Unsubscribe  
North Dakota Watchdog Network Logo

Republican State Senator Promotes Raiding Of School Savings Account

Republican State Senator sides with Teacher's Union
against School Board Association.

September 30th, 2016

Yesterday, Rob Port of the SayAnythingBlog hosted a debate on his radio show featuring State Senator Tim Flakoll (R-Fargo) and North Dakota School Board Association Jon Martinson.

And the debate got quite heated with Senator Flakoll mis-characterizing testimony given during the legislative session.

Senator Flakoll repeatedly claims that property taxes will go up if this fund is not opened up to be spent - this is a scare tactic and proves that when the "property tax reform buydown" money was rolled into the Permanent Education Spending Formula it was not so permanent afterall.

During the 2013 legislative session, the money that was used for the original Property Tax Buydown was rolled into the K-12 Education Funding Formula, as Governor Dalrymple's press release stated:

Following Dalrymple’s recommendation, the Legislature approved the most significant reform in K-12 funding in state history. The Legislature approved the governor’s proposal to establish a new, integrated formula to deliver both property tax relief and strong funding for schools so that all students receive the educational resources they need to succeed.

The Legislature approved $1.7 billion to fund schools and reduce the local cost for school funding. The appropriation represents an increase of $477 million compared to 2011-2013 funding. The new funding formula is sustainable and will result in most school districts needing to levy no more than about 70 mills to cover the local share of school funding. For the average school district, this represents about a 45 percent reduction in local property tax rates.

The Legislature also approved the governor’s recommendation to provide grants to school districts challenged by rapidly growing enrollments. The Legislature provided $13.6 million for school districts that experienced enrollment growth of four percent or more during the previous year. Additionally, the Legislature approved the governor’s proposal to increase school transportation funding by more than 10 percent, from $48.5 million to $53.5 million, to help districts meet the rising costs of providing student transportation services.

Now, all of a sudden, when the budget has gone beyond what revenue can support, the Chairman of the Senate Education Committee says that if the legislature can't raid the Foundation Aid Stabilization Fund your property taxes will go up.

So was Governor Dalrymple misleading the public when he said "The new funding formula is sustainable and will result in most school districts needing to levy no more than about 70 mills to cover the local share of school funding."

Or is Senator Flakoll simply manufacturing a scare tactic to promote the Teacher's Union agenda?

Why is it every time politicians spend too much money they end up threatening taxpayers?

The debate is about 36 minutes long, and for those who want to get a good handle on this issue, it is worth a listen.

There will be plenty more on this issue.

From September 26th, 2016: Measure #2 Gets More Opposition

Various education factions take sides on opening up trust fund to being spent on wider range of purposes in non-emergency situations.

Since last week, a few notable events have occurred revolving around Measure #2 which has gotten very little coverage so far this campaign season.

The first item of note is that the North Dakota School Board Association has come out AGAINST Measure #2 with similar reasons to our Watchdog recommended NO vote, but specific to their point of view. It is not often that a taxpayer advocacy group such as the North Dakota Watchdog Network agrees with a group like the N.D. School Board Association, but in this instance there is significant enough common ground to establish what the common sense stance on this years Measure #2 really is.

NDSBA Anti-M2 2016
***

Measure #2 is a legislatively-passed effort to place an upper limit on how much oil tax revenue can be placed in the Foundation Aid Stabilization Fund (15% of General Fund Spending on Education).

The exact language of the new text reads:

Whenever the principal balance of the foundation aid stabilization fund exceeds fifteen percent of the general fund appropriation for state aid to school districts, for the most recently completed biennium, as determined by the office of management and budget, the legislative assembly may appropriate or transfer any excess principal balance. Such amount may be used for education - related purposes, as provided by law.

Measure 2 2016 Testimony

During committee testimony, the North Dakota Watchdog Network testified on behalf of using this fund as a means to financing local school construction projects to save local schools money on bonding costs.

We specifically warned against including the phrase: “Such amount may be used for education - related purposes, as provided by law” due to the concerned that this would allow dollars from this fund to be used to bail-out the Teachers’ Fund for Retirement (TFFR – or the teachers; pension fund).

The TFFR is currently funded at barely above 60%, and if investment returns do not average at least 6.75% in a consistent on-going manner, the state will be required at some point to prop it up.

TFFR Funding

Furthermore, by allowing the transfer of principal in excess of 15% of general fund education spending, this proposal actually INCREASES the state’s reliance on oil tax revenue and since education is a more critical area, increasing reliance on oil tax revenue is not a fiscally sound prescription.

Another reason to oppose this measure is the need to protect the Legacy Fund. A public vote giving the governor access to the Foundation Aid Stabilization Fund would give the legislature a false-feedback that it's ok to start raiding the various trust funds when they over-spend on budgeting.

Due to the vagueness of the “education - related purposes” term, this measure falls short of providing taxpayers with savings and actually perpetuates the false security of funding government with oil tax revenue.

Measure #2 receives a Watchdog recommended NO vote.

***
***

Dustin Gawrylow, Managing Director

North Dakota Watchdog Network

***
Paypal Button
1px