Public schools turning to private financial sources

Trend raises questions about donors' influence on education

Indian Hills Elementary first-graders raise their hands to use the classroom's  interactive white board as teacher Gina
Indian Hills Elementary first-graders raise their hands to use the classroom's  interactive white board as teacher Gina Merrill sets up a math lesson on Friday, Jan. 27, at the school in Marion. All the school's classrooms have interactive whiteboards. (Liz Martin/The Gazette)

When California transplant John Gianola walked through Iowa City’s Longfellow Elementary School, he was delighted to see a full-time gym teacher and a classroom full of musical instruments

“It was remarkable that was just part of an elementary core program,” said the father of two girls.

In the Davis, Calif., school where Gianola was PTA president for two years, the group raised $70,000 a year to pay the salaries of part-time art, music and gym teachers. Otherwise, the elementary school would have gone without those classes because of state budget cuts.

While support for public education is stronger in Iowa than in other states, Eastern Iowa districts are deciding which schools to close, which classes to cut and which outdated textbooks can be used another year.

Private donations and corporate partnerships are backfilling the holes left by flat state funding. That approach, however, creates a potential disparity among schools and the perception that public schools aren’t really public.

“It starts to become a question of are these public entities, are these semipublic or quasi-private entities as we start to move the needle more toward these outside funding sources,” said Jason Glass, director of the Iowa Department of Education.

State funding strong in Iowa but slipping

Fundraising for Iowa’s K-12 schools has increased dramatically in recent years, with school districts of all sizes starting non-profit foundations. Of Iowa’s 351 school districts, about 150 have foundations registered with the National School Foundation Association.

The Cedar Rapids Community School District Foundation, supporting about 16,000 students, raised more than $245,400 in the year that ended Sept. 30. Iowa City’s school foundation, supporting close to 12,000 students, brought in $188,300 in 2010-11.

This private money from individuals and corporations pays for classroom programs, field trips, technology, sports facilities, scholarships and emergency grants for students.

“I am a strong believer that when there is a vacuum, it will be filled,” said Karen Swanson, executive director of the Cedar Rapids school foundation.

State support — the largest revenue source for schools — dropped from nearly 60 percent of the total general-fund expenses for Iowa’s K-12 schools in 1997-98 to 47.4 percent this year. Local taxes cover another 35 percent.

The state pays each school district $5,883 per student, which goes toward teacher and administrator salaries, educational materials, facilities and busing. The state usually provides an annual increase intended to cover inflation, but this year allowable growth was 0 percent. It returns to 2 percent for 2012-13.

“The harsh reality — and we shouldn’t sugar coat it — is that this may be the new reality for our schools going forward,” Glass said.

In this environment, the Cedar Rapids school district is considering closing several elementary schools. Iowa City is dipping into cash reserves to hire more teachers because of crowded classes.

The Keota School District is trying to raise $150,000 by June 30 to cover tax losses and cuts in state funding caused by declining enrollment.

“This time, it’s just regular needs,” said Mark Schneider, superintendent of the 300-student district 35 minutes southwest of Iowa City.

School supporters sent letters to Keota alumni asking for donations to replace 20-year-old textbooks and pay salary bonuses to recruit three teachers to the small, largely rural district, Schneider said.

The campaign has netted $65,000 so far to pay for things most Iowans would consider public costs.

Things are worse elsewhere

Iowa is better off than some states, including California and Colorado.

California has reduced its K-12 spending by $7 million since the start of the recession. The state now spends $1,000 less per pupil than it did in 2007-08, according to New American Media.

The erosion of K-12 spending in California started in the late 1970s with the passage of Proposition 13, which reduced the amount of property taxes collected by the state. Other legislation shifted responsibility for school funding from local officials to the state.

The Los Angeles Unified School District, one of the largest districts in the nation, has laid off more than 1,900 teachers and counselors, required remaining teachers to take furlough days and chopped three days off the school year.

In Colorado, the Jefferson County School District, a district of 85,000 students in Denver’s western suburbs, is considering eliminating elementary music and middle school librarians as the district’s budget went from $699 million in 2009-10 to $620 million for this year.

K-12 going the way of public universities

Public universities in Iowa and other states have made fundraising a top priority as the share of education covered by taxes has dwindled.

State taxes paid for just 36 percent of operational costs at Iowa’s public universities this year, compared with 77 percent in 1981. Tuition at the University of Iowa, Iowa State University and the University of Northern Iowa was just 21 percent of the general education fund in 1981 and now has risen to 58 percent.

K-12 schools are faced with the same challenge of increasing education costs and flat or declining state funding — without the option of charging tuition.

The National School Foundation Association, founded by Iowans in 2002, encourages K-12 schools to follow the model set by public colleges and universities, which garner large gifts through partnerships with corporations and alumni.

“The universities have learned to implement higher level fundraising skills,” said Jim Collogan, executive director of the Des Moines-based association.

Some larger K-12 foundations in Iowa are providing estate planning and electronic funds transfer to make giving easier. While they can’t charge tuition, many Iowa schools are adding steep fees for textbooks, technology and extracurricular activities, Glass said.

Haves and have-nots

Although school districts get the same per-pupil funding from the state, disparities exist because of tax base, enrollment and fundraising.

The Linn-Mar School District, which has about 6,700 students, opened a $10 million, 6,000-seat outdoor stadium last year. The project was funded by a School Infrastructure Local Option, or SILO, tax approved in Linn and Johnson counties in 2007.

The Alburnett Community School District, with about 640 students, has been raising money for its $1 million outdoor sports complex for a decade.

“We’re not the Linn-Mar district that can build a $10 million complex,” said Al Sorensen, president of the Alburnett Community School District Foundation.

Alburnett has been taking small steps at its sports complex, with an asphalt walking trail, softball diamond and a concession stand. An eight-lane track, which could cost at least $335,000, is still unfunded.

“Football could move in 2013, depending what we can beg, borrow or steal,” Sorensen said.

He’s not kidding about borrowing. The district is researching whether it can rehab Linn-Mar’s old lights to work in Alburnett.

While sports complexes aren’t necessarily core to a public education, technology also shows wide disparities — even within school districts.

Hills Elementary in the Iowa City school district has one interactive white board — called a SmartBoard — for every 12 students, according to a 2011 district technology audit. Iowa City’s Hoover and Weber elementaries each have one SmartBoard per 373 and 553 students, respectively.

More than half of Iowa City’s schools — and nearly all Cedar Rapids schools — qualify for technology money through a state settlement with Microsoft. Other schools are largely responsible for things like SmartBoards, projectors and document cameras.

“That creates disparate learning environments for students,” Iowa City Superintendent Steve Murley said.

Private aid, influence

Public/private partnerships formed out of necessity can be a good thing for Iowa schools, Glass said.

“It can be very much a positive that we have all these support systems willing to provide financial support for the schools,” Glass said. “The schools can’t do it alone.”

National education foundations, such as the Bill & Melinda Gates Foundation and the Walton Family Foundation, are pouring hundreds of millions of dollars into public education. These gifts often come with requirements intended to push K-12 schools toward the foundations’ goals.

“Gates has bought itself a big megaphone,” according to an October 2011 article in Governing magazine. “The foundation now spends nearly $400 million on various education initiatives around the country and is having a profound effect on education policy, particularly on the federal level.”

The foundation provided substantial support for developing common core academic standards that 40 states have pledged to adopt, the magazine reported.

The Walton Foundation, guided by the descendants of Walmart founder Sam Walton, have spent big money in states like Wisconsin to support the use of public money for private school vouchers.

If state budgets continue to shrink, as Glass has predicted, school districts will need to rely more heavily on private money from individuals, foundations and corporations. Time will tell how much influence these groups have.

“It’s always a big concern when the money is major,” said Jean Hessburg, spokeswoman for the Iowa State Education Association. The group’s parent organization, the National Education Association, gave $8 million last year to public school programs.

While some organizations use their money to exert change, Hessburg said, “lots of organizations give money to public schools and have no political agenda.”

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