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To:     LWVO
From: Joan Platz
Education Update for March 26, 2007

1)  127th General Assembly: 
The Ohio House and Senate will meet this week in sessions, and several committees, including the subcommittees of the House Finance and Appropriations Committee, will also meet to hear testimony on the biennial budget bill, HB 119 (Dolan).

*The Ohio House approved on March 21, 2007 HB2 (Webster), which transfers the authority to appoint the chancellor of higher education to the governor from the Board of Regents, and makes the chancellor a member of the governor's cabinet.  The bill was approved by a vote of 96-2.  Hearings on a similar bill, SB 2 (Cates), are being held in the Senate Education Committee this week.

2)  Summary of Committee Hearings for the Week of March 19-23, 2007:

*The House Education Committee, chaired by Representative Setzer, reported out favorably two bills on March 20, 2007, Am. HB 66 (Collier) and HB2 (Webster).

Am. HB66 establishes a minimum school year based on hours rather than days of instruction, which essentially eliminates the need for calamity days.  The bill was amended to allow schools and school districts to be out of session up to 100 days rather than 90 days, and allows chartered nonpublic schools to be in session up to five days or more to meet certain circumstances.  The second amendment raised concern among several lawmakers who felt that chartered nonpublic schools may opt for weekend sessions or a shorter week (four day schedule), which may have a negative impact on young children and families.  An amendment recommended by Representative Williams to require schools to operate a five day week was tabled, as was an amendment by Representative Luckie to require community schools to operate the same number of hours as traditional public schools.

The committee also reported out favorably HB2 (Webster), which gives the governor more authority over the Board of Regents and the authority to pick the chancellor of the Board of Regents.

*The Senate Education, chaired by Senator Padgett, also met and heard testimony on SB 2 (Cates), which is similar to HB2 (Webster) and transfers the authority of the Board of Regents to appoint the chancellor to the governor.

*The House Finance and Appropriations Committee, chaired by Representative Dolan, met on March 22, 2007 and heard testimony on HB 119 (Dolan) the operating budget for FY08-09, from the Director of the Office of Budget and Management, J. Pari Sabety, and Chuck Phillips, division chief from the Legislative Service Commission.

Director Sabety read from prepared testimony, and was not asked questions by committee members.  Chairman Dolan requested that members hold their questions until later so that they would have more time to review HB 119, which was available to them just that morning. Chairman Dolan stated that Director Sabety would be invited back to the committee to take questions at a later date.According to Director Sabety, "The guiding philosophy of the Strickland-Fisher Administration is to live within our means, and to invest in what matters. Our administration was elected with a specific, detailed agenda for action - the Turnaround Ohio Plan. The Executive Budget reflects substantial progress towards translating that plan into action. The Turnaround Ohio Plan is predicated on the assumption that we will create and keep jobs in Ohio by investing in Ohio's strengths, such as energy production and entrepreneurship, while bringing us the jobs of the future by assuring that we have the most educated workforce possible. This budget provides guideposts along the way as we begin our state's journey back to prosperity."

The $53 billion budget assumes overall tax growth of 2.1 percent in FY08 and -0.2 percent from FY08 to FY09, and reduces property taxes by $261.5.  The budget will increase spending by 4.4 percent over FY07 levels over the biennium, which is the lowest increase in 42 years, and saves $765.7 million through cuts from certain agencies and changes in law.

"Despite tight budget constraints, we have consistently worked to assure that our proposals do not put the burden of budget cuts on those with the least ability to endure them. "The full presentation is available on the web site of the Office of Budget and Management at http://www.obm.ohio.gov/

Chuck Phillips, division chief of the Legislative Service Commission (LSC), also presented an overview of revenue projections for FY08-09, which were lower than those used to prepare the executive budget recommendations.  The LSC is estimating revenue growth for FY08 at $100.5 million, which is 0.4 percent lower than the executive projections, and $61.6 million in FY09, which is 0.2 percent lower than the executive projections.  The phaseout of the corporate franchise tax is also expected to decrease revenue by approximately $54 million in FY08, but revenue from the sales and income taxes will increase. Total tax revenue for FY08 is estimated at $19.26 billion and $19.36 billion for FY09.

3)  This Week at the Statehouse:

MONDAY, MARCH 26, 2007
*The Committees of the Ohio Educator Standards Board will meet at 6:00 PM at Embassy Suites Hotel in Columbus, 2700 Corporate Exchange Drive.

TUESDAY, MARCH 27, 2007
*The Ohio Educator Standards Board will meet at 8:30 AM at the Embassy Suites Hotel in Columbus, 2700 Corporate Exchange Drive, Ballroom A.

*The House Education Committee, chaired by Representative Setzer (614-644-8051) will meet at 4:00 PM in room 116.  The committee will hear testimony on HB 27 (Wolpert) - academic performance ratings and HB85 (Webster) - expands the authority of the Ohio Board of Regents.

*The Senate Education Committee, chaired by Senator Padgett (614-466-8076), will meet at 4:00 PM in the North hearing room and approve appointments of the governor, and hear a presentation from the Ohio Association of Community Colleges.  The committee will also hear testimony on SCR 3 No Child Left Behind Act (Miller), which urges Congress to fully fund the No Child Left Behind Act, SB110 (Boccieri), which requires schools to test students for dyslexia and related disorders, SB118 (Gardner), which requires daily physical education instruction in grades K-6, and SB2 (Cates), which transfers the appointment of the Chancellor of high education to the governor.

WEDNESDAY, MARCH 28, 2007
*The House Finance and Appropriations Committee, chaired by Representative Dolan (614-644-5088), will meet at 10:00 AM in room 313 to hear a presentations from OBM Director J. Pari Sabety on HB119 (Dolan) the biennial budget.

*The House Ways and Means Committee, chaired by Representative Gibbs (614-466-2994), will meet at 2:30 PM in room 121 to hear testimony on HB 117 (Raussen), which permits school districts to enter into agreements with the Department of Taxation for collection of school income taxes.

*The Senate Finance and Financial Institutions Committee, chaired by Senator Carey, will meet at 2:30 PM in the Finance hearing room.  The committee will have an informational briefing from the Office of Budget and Management on the Tobacco Securitization proposal included in HB119 (Dolan).

THURSDAY, MARCH 29, 2007
*The House Finance and Appropriations Committee, Subcommittee on Primary and Secondary Education, chaired by Representative Schlichter, will meet at 9:00 AM in room 113 to hear a presentation regarding the biennial budget (HB 119 - Dolan) from the Department of Education regarding school accountability, school improvement, school choice, teacher quality, early childhood education, and student intervention.

TUESDAY, APRIL 3, 2007
*The House Finance and Appropriations Committee, Subcommittee on Primary and Secondary Education, chaired by Representative Schlichter, will meet at 9:00 AM in room 113 to hear a presentation regarding the biennial budget (HB 119 - Dolan) from the Department of Education (if needed),  School Facilities Commission; eTech; School for the Blind; and School for the Deaf.

WEDNESDAY, APRIL 4, 2007
*The House Finance and Appropriations Committee, Subcommittee on Primary and Secondary Education, chaired by Representative Schlichter, will meet at 9:00 AM in room 113 to hear all testimony on biennial budget (HB 119 - Dolan).

THURSDAY, APRIL 5, 2007
*The House Finance and Appropriations Committee, Subcommittee on Primary and Secondary Education, chaired by Representative Schlichter, will meet at 9:00 AM in room 113 to hear all testimony on biennial budget (HB 119 - Dolan).

TUESDAY, APRIL 10, 2007
*The House Finance and Appropriations Committee, Subcommittee on Primary and Secondary Education, chaired by Representative Schlichter, will meet at 9:00 AM in room 113 to hear all testimony on biennial budget (HB 119 - Dolan).

WEDNESDAY, APRIL 11, 2007
*The House Finance and Appropriations Committee, Subcommittee on Primary and Secondary Education, chaired by Representative Schlichter, will meet at 9:00 AM in room 113 to hear all testimony on biennial budget (HB 119 - Dolan).

THURSDAY, APRIL 12, 2007
*The House Finance and Appropriations Committee, Subcommittee on Primary and Secondary Education, chaired by Representative Schlichter, will meet at 9:00 AM in room 113 to hear all testimony on biennial budget (HB 119 - Dolan).

4)  Federal Update - 110th Congress: 

The U.S. Senate approved S.C.R. 21 (Conrad) on March 23, 2007, a FY08 $2.9 trillion budget plan. This budget is not binding, but provides guidelines for further action by Congress when it considers several appropriations bills later this year. The House is expected to debate its version of the budget (H.R. 99) next week.

The Senate plan projects a balanced budget in five years, but maintains several popular tax cuts that were to expire in 2010. Those taxes would have raised an additional $132 billion in 2012. The plan does not include funding for the war in Iraq or address the alternative minimum tax issue.

The Senate plan increases funding for education to $62.3 billion, approximately $6 billion more than FY07 levels.  The plan also eliminates the proposed cuts in education programs recommended by President Bush, provides additional funding for Head Start, IDEA, NCLB, and Pell grants, and provides $50 billion for the Children's Health Insurance Program (CHIP).  For more information visit http://thomas.loc.gov/cgi-bin/bdquery/D?d110:6:./temp/~bss66wH::.

*The House Education and Labor Committee approved on March 13, 2007 legislation to reauthorize the Head Start program, H.R. 1429.  The legislation also proposes that a committee of experts be formed to review program grants.  The Senate Health, Education, Labor, and Pensions Committee approved its version of Head Start reauthorization legislation last February.  For more information about the House bill please visit http://thomas.loc.gov/cgi-bin/query/D?c110:2:./temp/~c110cUh66f::

*Several lawmakers are sponsoring H.R. 821, "Everyone Deserves Unconditional Access to Education (EDUCATE) Act", to increase funding for IDEA to provide 40 percent of the national average per pupil expenditure level for special education by 2015.  When IDEA was first approved in 1975 Congress promised to provide states 40 percent of the per pupil cost of the program.  However federal support of IDEA has never reached 40 percent, and is currently 17.2 percent. Currently 12 percent of school children in the U.S. receive special education funding through IDEA.  For more information about the bill please visit http://thomas.loc.gov/cgi-bin/thomas

*Several lawmakers have introduced the Striving Readers Act, which would provide grants to every state for reading and comprehension programs to meet the needs of students in grades four through twelve. For more information about the legislation, please visit http://sessions.senate.gov/pressapp/record.cfm?id=271198

5) OEA Files Charter School Lawsuit: 
The Ohio Education Association filed a lawsuit, State ex rel. Geneva Hinton, et al. v. State of Ohio Board of Education, et al. on March 21, 2007 in Franklin County Common Pleas Court on behalf of Dayton Public School parents and the Dayton Education Association.  The purpose of the lawsuit is to compel state officials to provide systematic oversight of Ohio's charter schools, and end diversion of funds away from traditional public schools.  The lawsuit charges that as a result of charter schools, the Dayton Public School District has lost $189 million in state and local funding.  The suit also alleges that charter schools lack oversight and do not comply with the terms of their contract or state law.  For more information visit http://www.ohea.org/GD/Templates/Pages/OEA/OEADefault.aspx?page=1

6)  Updated Cupp Report Available: 
The Ohio Department of Education announced last week that an updated and revised "District Profile Report", also known as the Cupp Report, is now available on the ODE web site, along with the Historical Comparison Report.  The report includes practically everything you may want to know about school district funding, including demographic data; personnel data; property valuation and tax data; local tax effort data; expenditure data; revenue by source data and school district financial status data: etc. The report is available at http://www.ode.state.oh.us/GD/Templates/Pages/ODE/ODEDetail.aspx?Page=3&TopicRelationID=990&ContentID=26549&Content=26682

7)  More Detail on the Proposed FY08-09 Budget: 

The FY08-09 proposed Executive Budget is now available in bill form as HB119 (Dolan).  The 2000 + page bill includes the changes in law and recommended funding levels for state agencies and departments in FY08 and FY09 proposed by Governor Strickland.  Information about the Executive Budget compiled from the budget briefing documents was included in the Education Update last week.  The following information provides more detail about the legislative changes included in HB 119 prepared from the bill and an analysis of the bill prepared by the Legislative Service Commission.  The bill and analysis are available at http://www.legislature.state.oh.us/bills.cfm?ID=127_HB_119

Changes in the Formula
School Funding Base-cost - Continues the building block method to determine the base cost, which increases by three percent to $5,565 in FY08 and $5,732 in FY09.  However the base cost of e-schools was changed to $3,295 in FY08 and $3,387 in FY09 to reflect the use of a new student teacher ratio of 100 to 1 rather than the 20 to one used for other types of schools.

Base funding supplements are retained for academic intervention (increase of 3 percent each year), professional development (unchanged), and data-based decision making (unchanged).

Adds poverty based assistance and parity aid to the base cost and the calculation of the state share percentage.

Requires the Superintendent of Public Instruction to verify formula Average Daily Membership and make adjustments to the number if necessary.

Parity Aid
Changes the calculation of parity aid.  Parity aid will provide districts an amount that represents what 8 mills in FY08 and 8.5 mills in FY09 will raise in the 123rd wealthiest district.  410 low wealth districts will qualify in FY08 and 367 districts in FY09.

Poverty Based Assistance
Makes several changes to calculate poverty based assistance, including a new subsidy for districts that meet or exceed the new "academic distress percentage".  Also changes the term "class size reduction" to "classroom learning opportunities", keeps the phase-in for limited-English proficient, but fully funds dropout prevention, professional development, and community outreach, rather than phasing in the levels in current law.

Revises the spending requirements for poverty based assistance to provide more flexibility, and requires districts to report to the ODE how they are using poverty based assistance.

Special Education
Keeps the 90 percent phase-in for special education weights. Increases the threshold amount for catastrophic special education and related services.

Guarantees
Provides transitional aid in FY 08 and FY09 to prevent any school district's state funding for the current fiscal year from being less than it was in the previous fiscal year.

Removes from the calculation gap aid revenue received by a school district to replace the Tangible Personal Property Tax Replacement Fund or the phaseout of the tangible personal property tax.

Eliminates the reappraisal guarantee.

Transportation
Increases by one percent state funding for transportation in FY08-09 and implements a ODE new recommended transportation formula, which would begin to operate in the 2009-2011 fiscal biennium.

State Education Aid
Creates a new term "state education aid" to replace the term "SF3 payment".  State education aid is defined in ORC Section 5751.20 as the subsidies and adjustments on the ODE's "SF-3" form that are used to calculate state aid, plus temporary transitional aid and transportation payments. The new term, "state education aid," is also used to identify payments to a school district as a result of the phase-out of tangible personal property tax and reimbursement for losses due to utility deregulation.

Community Schools
Overall tightens the oversight of community schools and their sponsors. Requires community schools to comply with all state laws and rules applicable to public schools, school districts, and boards of education. (Section 3314.04)

Places a moratorium on the establishment of new traditional "brick and mortar" community schools, including conversion schools, between May 1, 2007 and July 1, 2009, with no exceptions, and places new restrictions on sponsors.  E-schools are currently under a moratorium until the General Assembly approves standards for e-schools.

Prohibits a community school that opened for operation after May 1, 2005, from operating from a residential facility that receives and cares for children until July 1, 2009.

Limits an educational service center (ESC) to sponsoring community schools that are located in a county within the ESC's territory or in a contiguous county.

Requires community school operators to be nonprofit entities.

Requires community school governing authorities to award contracts for operators through a competitive bidding process established by the Department of Education.

Requires community schools to provide students with 180 days (instead of the current 920 hours) of learning opportunities each school year.

Requires an e-school student to participate between five and ten hours of learning in order for the day to count toward the 180 days of learning opportunities the school must provide to the student.

Requires a community school to withdraw a student who fails to participate in 21 consecutive days (rather than the current 105 consecutive hours) of learning opportunities without excuse. Prohibits the student from re-enrolling for the remainder of the year, unless the school only serves dropouts.

Increases the minimum enrollment for community schools from 25 students to 100 students, but permits the Department of Education to grant waivers from the requirement.

Requires each e-school to employ at least one full-time teacher of record for each 125 students enrolled in the school.  Current law requires e-school to retain an affiliation with rather than employ.

Requires community schools to conduct criminal records checks of governing authority members.

Eliminates state payments to community schools for parity aid and poverty-based assistance for dropout prevention and community outreach.

Specifies that funds remaining after payment of debts after a community school permanently closes, must be paid to the Department of Education for redistribution to the resident school districts of the community school's students.

Repeals 1) a requirement that a school district first offer property suitable for classroom space for sale to start-up community schools in the district, 2) a requirement that a district offer property suitable for classroom space for sale to start-up community schools in the district when the district has not used the property for educational purposes for one school year and has not adopted a plan to use that property within the next three years, and 3) a provision granting a district that sells unused property to a community school under the right of first refusal if the community school later disposes of the property.

Academic Distress
Changes current law regarding an academic distress commission.  1) Permits rather than requires the Superintendent of Public Instruction to establish an academic distress commission for a school district that has been in academic emergency and has not met adequate yearly progress for four or more consecutive school years; 2) Requires that the two members of an academic distress commission appointed by the president of the district board be residents of the district; 3) Changes procedures and requires each commission to adopt an academic recovery plan approved by the Superintendent of Public Instruction.

Repeals the current law regarding reporting EMIS data, and authorizes the ODE to take a series of sequential actions against a school district, community school, or educational service center that fails to properly report EMIS data.  These include withholding state funds and auditing the data.

Limits the highest performance rating a school district or building may receive based on the percentage of its students who do not take all required achievement tests.

Physical Education
Requires the State Board of Education, by December 31, 2008, to adopt the standards for physical education in grades K through 12 developed by the National Association for Sport and Physical Education (NASPE).

Directs the Superintendent of Public Instruction to appoint a physical education coordinator.

Reduction in Force
Removes the "for financial reasons" from the list of statutory reasons a school district or educational service center may make reductions in its teaching force or nonteaching staff.

Accountability
Requires a school district to label equipment or materials that it purchases or leases with state auxiliary services funds and which are loaned to a chartered nonpublic school, unless the district determines that they are consumable or have a value of less than $200.

Teachers
Qualifies all public and chartered nonpublic school teachers who hold a valid teaching certification issued by the National Board for Professional Teaching Standards to an annual $2,500 stipend

Changes the term "special education teachers" to "intervention specialists."

Adult Education
Requires the Department of Education, in collaboration with the Board of Regents and the Governor's Workforce Policy Board, to develop and implement a plan by July 1, 2008, to move adult education and career programs from the Department to the Board of Regents.

Early Childhood Education
Early Learning Initiative (ELI) (Section 309.40.60) - Establishes the Early Learning Initiative (ELI), which will be paid for with federal Title IV-A (TANF) funds.  This program will serve up to 12,000 children who meet the income and other eligibility requirements, and are at least three years of age.  The program may serve children
whose families do not meet the federal poverty income level.  The program will provide full-day, part-day, or a combination of services, and those services are specifically outlined in the bill.

The ODE and the Ohio Department of Jobs and Family Services are required to develop the rules and administer the program, including the development of guidelines for school readiness to evaluate the success of the ELIs, and oversee proper credentials of the ELI agencies.

State Funded Early Care (Section 269.10.20) - Continues GRF funding for early childhood education programs provided by eligible school districts, joint vocational districts, and Educational Service Centers (ESCs) for children at least three years old and whose families meet income requirements.  Families above the income requirements must pay for services.  Provides up to $18,622,151 in FY08 and FY09 for programs operated by providers in FY07 with some exceptions and new providers, and establishes accountability requirements.

Requires the ODE to compile and distribute an annual report on state funded early childhood education programs and early learning program guidelines for school readiness.

Changes current law to allow any school district to establish a preschool program, even if the district is not eligible for poverty based assistance.

Changes the timeline for teachers in preschool programs, early childhood education programs, and early learning programs to have earned an associate's degree and a bachelor's degree in order for the program to receive state funding.

Higher Education
Disqualifies certain students after the 2007-2008 academic year from receiving Ohio College Opportunity Grants.  Students entering most for-profit proprietary schools after the 2007-2008 academic year or certain two-year education programs sponsored by institutions of higher education that do not have certificates of authorization from the Board of Regents will not be eligible for OCOG.

Requires students who apply for Student Choice Grants to meet the need-based requirements of the Ohio College Opportunity Grants.

Eliminates the Student Workforce Development Grant which provided tuition assistance to students enrolled full-time in Ohio proprietary schools and are pursuing an associate's or bachelor's degree.

Beginning in the 2008-2009 academic year, requires each state university, community college, state community college, university branch, and technical college to provide students with an itemized list of fees and charges owed by the student.

8)  A book published in November 2006, "Two Americas, Two Educations:
Funding Quality Schools for All Students," by Paul F. Cummins, describes the inequity in educational opportunities for students in the United States as a result of the imbalance in wealth.  According to Cummins the amount of dollars available for education is not the question, but how the dollars are distributed and how they are efficiently used that matters.  The current economic system favors the rich and corporations, to the detriment of the poor, and threatens the fabric of democracy.

9)  Bills Introduced:

HB114 (Wachtmann) - Prevailing Wage - Reduces state funds for schools requiring contractors to pay prevailing wage.
HB116 (Blessing) - Health Savings Accounts - Requires public employers to make health savings accounts available to public employees.
HB117 (Raussen) - School District Income Taxes - Districts enter into agreements with Department of Taxation for collection of school income taxes.
HB119 (Dolan) Biennial budget - Makes operating appropriations for the biennium.
SB118 (Gardner) - Physical Education Instruction - Requires daily physical education instruction in grades K-6.
 
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