State Policy Implications:

Ed Reform and Property Taxes

2012 Education Reform SF 2284•36 Hours of Collaboration for practitioners▫ collaboration time and peer review in years 2 and 3

of teacher evaluation cycle and annual administrator reviews.

▫ collaborate with each other to deliver educational programs and assess student learning, or to engage in peer review

▫ In Code Section 284: references the Iowa Professional Development Model

▫Collaboration can take place during PD time, but not during prep time (minimum school instructional day must still be at least 5.5 hours)

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Iowa Professional Development Model

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Education Reform Efforts 2012•Third-grade Retention▫Early literacy support and expectations:

district must have early elementary intensive reading program, third grade proficiency or summer school option (several exceptions), parent choice, mandate is based on future funding

▫Reading research center, $2.0 million, directed to provide best practices on summer school, intensive reading instruction, and response to intervention, initially focusing on early elementary

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Education Reform Efforts 2012•Assessment▫Iowa Tests required for all 10th graders too▫PK assessment to serve multiple masters▫Solidified commitment to tests used July 1,

2011 unless state board of education, House, Senate and Governor agree to change it (despite conversation about Smarter Balanced or RTI, Iowa law says schools will use Iowa tests until Iowa law changes.)

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Education Reform Ideas on the Table for 2013 Legislature•Task Force Reports Just In: ▫Teacher Leadership and Compensation

(Career Pathway)▫Instructional time (Hours/days and Start

Date)▫Teacher Evaluation (Rubric tbd)▫Administrator Evaluation (Rubric tbd)

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Education Reform Ideas on the Table for 2013 Legislature•Messages from leaders continue to call

for increasing class size or repurposing resources

•Funding and state support challenges:▫Allowable Growth not yet set for FY14 or

FY15▫Weightings all depend on that number▫Bargaining is related to that number▫3rd Grade retention/summer school tied to

$$$▫Lengthening school day/year costs $$$ ▫Teacher pay/career pathways costs big $$

$

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Policy Sweet Spot: solve two problems with one state dollar• Property tax reform in the context of school finance

reform can deliver both taxpayer and student equity. • FY 2013 Total school tax rates vary from a low

of $8.33 to a high of $23.06 per $1,000. Efforts to address inequities in the property tax system should first solve inequities within classes of property.

• Since student needs tend to be more extreme in districts with relatively lower property values supporting each student, efforts to address taxpayer inequity will also serve students.

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Why Not?•Consider last year’s property tax reform

efforts▫$200-$350 million for commercial, $750

million to eliminate the additional levy▫Targeted at commercial tax relief, lowered

the tax base, made some effort to hold local governments and taxpayers harmless

▫Likely a negative impact on school district valuations, which means increased tax rate unless school finance is also reformed.

•Why not use school finance changes to deliver property tax equity and relief?

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Picture Two Identical Businesses

• Both commercial property taxed at market value (although no M&E property tax, corporations get depreciation, and pay little corporate income tax)

• Same square footage, similar FTE and sales• Okoboji to Ballard, almost $15/$1,000 difference• This inequity is greater than the difference

between residential and commercial burden

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$8.33 /$1,000

$23.06 /$1,000

Residential vs. Commercial

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• Residential property is taxed at around half of market value

• Homeowners in high tax rate school districts pay greater property taxes than similarly assessed commercial property owners in low tax districts

• Homeowners in high tax school districts pay 3X the property taxes of homeowners in low tax school districts for similarly assessed residential property

Policy Suggestions to promote taxpayer equity/relief and student equity• Continued investment in Property Tax Equity and Relief

Fund lowers high taxes first, then delivers tax relief to all taxpayers

• See one page handout summarizing all of the possible ways that the state could contribute to school funding to promote:▫ dropout prevention or at-risk▫ English-language learner year 5 or costs exceeding the

weighting▫ Other property tax funded school costs: on-time funding,

special education deficit, budget guarantee, cash reserve or management levies, PPEL

• Benefits to This Approach:▫ Taxpayers in low valuation districts would receive greater

benefit in terms of tax rate reduction▫ Commercial taxpayers get twice the benefit▫ School districts (and cities and counties) wouldn’t suffer the

consequence of lower valuations (avoids shift to residential and ag)

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Key Messages•Education Reform is important and

necessary•Education Reform takes resources to

support significant change• Iowa Education has been funded at a

noncompetitive level compared nationally at the very time students in other states are making great gains and surpassing Iowa students

•Sensible property tax reform can help taxpayer and student equity

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Resources• Share these materials at your board table,

discuss/share with the press, press release on condition of state funding for education

• ISFIS Conference Presentation on the myth of commercial tax reform

• UEN Legislative Digest includes UEN advocacy history

• ISFIS Legislative Digest includes policy and funding data to help

• Tools for advocacy and budgeting – the budget projection tool on ISFIS website and Issue Briefs

• UEN Legislative Web Page http://www.uen-ia.org/legislation.htm

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The best ways to contact us:Text us – Be sure to include your name in the

message ▫ Larry’s cell 515-490-9951▫ Margaret’s cell 515-201-3755

Email us ▫ Larry.sigel@isfis.net ▫ Margaret.buckton@isfis.net▫ Traci.giles@isfis.net ▫ Sean.gibson@isfis.net▫ Susie.olesen@isfis.net

Call the office – Traci will grab the call if we’re not in at the moment▫ 515-251-5970 Option 1 for Margaret, Option 2 for

Sean, Option 3 for Larry, Option 4 for TraciWhen we’re on the road and out of the office,

texting is the best way to get in touch with us.