The Massachusetts foundation budget (which ensures a minimum level of school funding for each district) was considered groundbreaking at the time of its passage in 1993. It was designed to ensure adequate resources for low-income and minority districts, to enable them to meet the state’s new, higher standards. Fast-forward seventeen years. This new report by Ed Moscovitch, the budget formula’s architect himself, finds that spending gaps between rich and poor districts have not closed, and increases in state aid under the plan have failed to keep pace with the actual cost of running schools. That’s largely because spending on health benefits has exploded compared to other operating expenses over the past decade. From 2000-2007, state spending on benefits increased by 13.6 percent annually, leaps and bounds above the 5.4 percent yearly increase allotted in the foundation budget. These massive augmentations, the report assesses, have chalked up $1 billion in additional costs to the state, and have commandeered funds from inputs more related to student learning (professional development, educational materials, etc.). The report—the first in a three-part series—is an important reminder to policymakers in Massachusetts and beyond: teacher pensions might be getting all of the attention, but out-of-control healthcare costs are just as big a problem.
Edward Moscovitch, “School Funding Reality: A Bargain Not Kept,” (Gloucester, MA: Cape Ann Economics, for the Massachusetts Business Alliance for Education, December 2010).
