News Story

Narrative Changing On Michigan K-12 Education Spending

During his Jan. 16 State of the State address, Gov. Rick Snyder said he increased funding to K-12 education.

For Audrey Spalding, director of education policy at the Mackinac Center for Public Policy, and James Hohman, assistant director of fiscal policy at the Mackinac Center, it was a simple claim to verify. The Senate Fiscal Agency had a chart it produced that showed the increase in state funding under Gov. Snyder. The Senate Fiscal Agency describes itself as a "nonpartisan legislative agency created to provide the Michigan Senate with sound and unbiased assistance …"

Still, that claim set off a flurry of criticism from conventional public school advocates who initially said Gov. Snyder was incorrect and funding has decreased.

And some of the state's newspapers treated the issue as a "he said, she said" debate without carefully examining the claims. The Detroit Free Press reported in a story the day before Gov. Snyder's speech that districts were in deficit partly because of state funding cuts, a claim the newspaper later stated was not accurate.

On the day of Gov. Snyder's speech, Democratic gubernatorial candidate Mark Schauer posted on his campaign Facebook page that Gov. Snyder cut funding to K-12 education. 

Eventually, the traditional media changed its reporting of the so-called funding cuts. MLive and the Free Press concluded it was not accurate to say Gov. Snyder cut funding. But not until a series of stories by Michigan Capitol Confidential helped show them the way.

On Jan. 17, Michigan Capitol Confidential did a story highlighting how Gov. Snyder has increased funding to K-12 education and cited a Senate Fiscal Agency report to document the claim. On Jan. 24, Capitol Confidential did a story noting that Schauer was wrong when he told WJR radio any increase in school funding under Gov. Snyder was due to federal dollars. The article pointed out that federal funds had declined under Gov. Snyder relative to former Gov. Jennifer Granholm.

Capitol Confidential then reported Jan. 27 that advocates for more state funding were ignoring $2 billion public schools get that is not part of the per-pupil state foundation allowance. Part of the $2 billion being ignored was the state making payments on the pensions and retiree health care plans for school employees, the Michigan Public School Employees Retirement System (MPSERS).

A Jan. 29, story examined how the state helped in paying off MPSERS' unfunded liability, but pointed out that in the ongoing debate that money wasn't being counted toward state funding.

Eventually, the traditional media joined in.

On Feb. 2, Detroit Free Press reporter Paul Egan did a story that said the claims of education cuts amounted to "a false accusation" about Gov. Snyder's actions on education.

"Did Snyder cut $1 billion from K-12 education, as many critics claim?" the article asked. "The answer is no, state records show. In fact, Snyder's first budget ultimately increased the state share of education funding by about $134 million, from $10.7 billion in 2011 to $10.8 billion in 2012."

Still, Schauer's campaign has continued with the debunked claim that Gov. Snyder cut $1 billion in funding from education. It posted on Feb. 3 a link to a commercial from the Democratic Governors Association that made the same claim.

Then on Feb. 5, MLive did a "fact check" on Schauer's claim that Gov. Snyder cut $1 billion from education and found the claim to be inaccurate

The MLive story reported the new narrative Gov. Snyder's critics are making since they no longer can claim he cut state funding to K-12 education.

"Overall state spending is up," the MLive story read. "… but that doesn't necessarily mean all of that money is making it into the classroom."

Gov. Snyder's critics say the $160.5 million in 2012-13 and the $404.4 million in 2013-14 that the state used to pay for teacher retirement costs (MPSERS) is not considered "in class" spending.

Bridge Magazine's "Truth Squad" reviewed the governor's first commercial announcing his run for another term and said funding was both up and down. It also claimed teacher pension benefits are not classroom spending.

"There is wider appreciation for the fact that Snyder did increase school budgets, just not as much as the public schools wanted," Hohman said. "When school officials complain about money not being spent 'in the classroom,' what they seem to mean is that the state isn't contributing money directly to their general fund without any strings attached."

Michigan Capitol Confidential is the news source produced by the Mackinac Center for Public Policy. Michigan Capitol Confidential reports with a free-market news perspective.

News Story

Democrats Selectively Considering Pension Benefits In Education Funding

Pensions once 'earned in the classrooms' now excluded from funding equation by Democrats

Top Democrats are being inconsistent on whether paying for teacher retirement benefits qualifies as a classroom expense.

Their position seems to depend upon the political circumstance of the moment.

In May 2012, Robert McCann, spokesman for the Senate Democrats, criticized Republicans for asking teachers to pay more to cover their retirement costs. He said the pensions were earned by teachers with "a lifetime of hard work in the classrooms."

In 2012, Sen. Gretchen Whitmer, D-East Lansing, talked about retirement costs of teachers and described teachers as "the same people who played by the rules, negotiated for their compensation, which included retirement."

However, Democrats now claim the $404.4 million applied in 2013-14 to pay the cost of Michigan Public School Employees Retirement System benefits is not a classroom expense.

A number of notable Democrats originally claimed Gov. Rick Snyder cut funding to K-12 education. But once it was pointed out they were ignoring the $564 million in 2012-13 and 2013-14 the state paid to cover MPSERS costs, Democrats shifted to say those weren't classroom expenses. 

But a teacher's overall compensation, which includes pension benefits, most certainly is a classroom expense, said James Hohman, assistant director of fiscal policy at the Mackinac Center for Public Policy.

"To the extent that the funding is going to catch up on underfunding, MPSERS contributions are paying for yesterday's classroom,” Hohman said. “Funding a retirement system is clearly part of an employee's compensation.”

House Democratic Leader Tim Greimel of Auburn Hills told the Associated Press that even though Gov. Snyder put more money into retirement funds, "We need more money in the classroom, where it improves the quality of student education, where it lowers class sizes."

In a Detroit Free Press article, Birmingham Public Schools Spokeswoman Marcia Wilkinson said the MPSERS contribution doesn't get to the classroom because it's "matched by a bill from the Office of Retirement Services."

Hohman said that bill from the Office of Retirement Service covers increased compensation for public school employees, including teachers, who are in the classroom.

Even representatives of the Michigan Education Association agreed in 2012 that retiree benefits were part of a teacher's overall compensation.

In 2012, Stu Skauge, the MEA's Uniserve director for Marquette and Alger counties, told a local newspaper about how retirement benefits fit in with overall compensation.

Skauge said teachers had been consistently taking lower wages so districts could offer them better retirement and health benefits. 

Michigan Capitol Confidential is the news source produced by the Mackinac Center for Public Policy. Michigan Capitol Confidential reports with a free-market news perspective.