No big adjustments in sight for school funding formula

The superintendent of the Esmeralda County School District drives a school bus when necessary.

Staffing is so limited for the rural district that its one-room schoolhouses will close for the day if a teacher calls in sick, said Bob Aumaugher, the Esmeralda superintendent.

The school district, which served 68 students last year and has no high school, will receive $17,038 in per-pupil state funding for 2009-10, or more than three times as much as Clark County's per-student allotment of $5,025.

While the Clark County School District has made deep cuts and drawn from its savings to finance the new school year, its per-student allotment is $226 less than the state average of $5,251.

In these tight financial times, the formula is perplexing to School Board members like Linda Young. "Am I hearing this right?" she asked during a meeting after hearing about other counties receiving more state aid.

Because Clark County has large purchasing power and economies of scale, it's considered "more efficient" than sparsely populated rural counties with long bus routes, state education officials said.

Clark County is not getting short-changed when compared to Eureka County, which is only getting a token $100 in state support per student.

Because the federal stimulus funding was distributed according to the state's education funding formula, Eureka's schools are also not getting any funding from the American Reinvestment and Recovery Act.

Clark County schools, on the other hand, are getting more than $100 million.

But gold-rich Eureka has enough local revenues to spend up to $41,000 per student, according to the state Department of Education.

"Sure, we're riding high today," said Ben Zunino, superintendent for the Eureka County School District. He said his district is actually trying to save as much money as possible because the price of gold is so cyclical.

"We're preparing for a downturn," he said. "We know it's coming."

Because the state is in a two-year window of taxing mineral proceeds according to profit forecasts, the mining industry has been paying its taxes ahead of schedule.

The Eureka County School District doesn't expect to get any mineral proceeds tax revenue in 2010-11, which is considered the "catch-up" year for settling accounts between the mining industry and tax collectors.

Plus, Eureka faces the same problems as any rural county.

"We can't find a high school science teacher," Zunino said. "We're offering six months rent."

Because of its isolation -- Eureka is 115 miles from the nearest Wal-Mart in Elko -- it offers housing and relatively generous wages to attract staff. Its entry-level teachers earn $41,000 a year, which compares to $35,000 for a beginning teacher in Clark County.

Every school district has its own particular problems, but the Nevada Plan attempts to provide a "reasonably equal educational opportunity" to every child in the state.

It ensures a basic level of per-pupil funding if local sales and property tax revenues fall short, but state aid is also reduced if local revenues are considered sufficient, as in the case with Eureka.

State aid to school districts is weighted according to a formula that considers factors such as enrollment, teacher and staffing expenses, transportation, urbanization and local wealth.

Jeff Weiler, chief financial officer for the Clark County School District, said funding also is based on what was spent the previous year. So, if Clark County spends less one year, it will receive less the next year, he said.

Esmeralda must depend on the state for 79 percent of its education budget, because it's a poor county with unusually high expenses.

It must hire a full-time bus mechanic, for instance, because it cannot find someone to do the work part time, Aumaugher said.

In comparison, Clark County receives about 44 percent of its basic education funding from the state. The remainder comes from local taxes: 41.6 percent comes from 2.6 percentage points of the 8.1 percent sales tax and 14 percent comes from one-third of the property tax.

While funding adequacy is a separate issue, the Nevada Plan has been considered successful because Nevada has avoided the contentious lawsuits over inequities in education funding that have been a problem in many other states.

"As far as I know, it has not been challenged in court," said Daniel Fox, superintendent of the Pershing County School District in Northern Nevada. "Other states look to it as a model."

Joyce Haldeman, the Clark County School District assistant superintendent for community relations and the schools' chief lobbyist in Carson City, said there doesn't seem to be any urgency in the Legislature for change.

"It's a good little program for the state, but notice it's called the Nevada Plan and not the Education Plan," said Haldeman, noting that it does not really address the issue of what is adequate funding.

Aside from the adequacy issue, Haldeman would like to tweak the formula so school districts would get consideration if they have large numbers of low-income students, limited-English speakers and other students with special needs.

Clark County School Board member Sheila Moulton thinks it's unfair that counties with declining enrollments are protected by a "hold harmless provision" that guarantees their previous level of annual state funding for another year.

Clark County has struggled to keep up with an ever-expanding enrollment.

"All we have ever done is grow," Moulton said. "They say growth pays for itself. I have never been a believer in that."

Like Clark County, the Carson City School District is drawing from its savings to cover expenses for the new school year, but it is planning to maintain an ending fund balance of 8 percent of its budget, said Bob Anderson, financial officer for Carson City.

On the other hand, Moulton said the ending fund balance for Clark County is expected to drop as much as 2 percent.

Contact reporter James Haug at jhaug @reviewjournal.com or 702-374-7917.