July 28, 2006: Almost a year after the Governor issued his Executive Order mandating the adoption of the 65% rule; the Texas Education Agency released its version of the rule which will become effective August 13, 2006. As we have previously reported, the rule has been merged into the Financial Accountability Rating System and became two indicators in the final version of the rule.

The current version of the 65% rule creates two indicators. The first indicator uses only the National Center for Educational Statistics (NCES) definition and phases it in over the next three years beginning with a target of 55% this year. School districts can choose to post their check registers excluding personnel costs on their web sites instead of meeting this requirement.

A new indicator was created that uses the NCES definition plus the cost of librarians, counselors, and nurses. That indicator must equal or exceed 65% this year and there is no phase in.

Both indicators are part of the larger Financial Accountability Rating Systems and the points gained or lost for the indicators are included in the overall calculation of the districts score.

Other than the reworded phase in of the 65% rule and splitting the impact of the 65% rule into two criteria, TEA made several other smaller changes:

It provides an exception, for fast growth districts, to the requirement that all districts have a net asset balance greater than zero.

Changed the requirement for a district requiring a district to exceed the academically unacceptable rating from a critical to a non-critical indicator, however to a district must still meet that criteria in order to get a superior achievement rating.

It eliminated three indicators addressing operating expenditures per WADA and requiring districts to have a recognized or exemplary rating.

Reduced the points awarded for meeting the cash management indicator to four points (in order to have two three point indicators on the 65% rule, rather than the one indicator worth five points in the previous version of the rule).

What the Rule Does: Based on our analysis of the information we received from TEA this is the effect of the implementation of the 65% rule.  TEA has not posted the rule to register yet, so it may change.

The proposed rule adds the 65% standard to the Financial Accountability Rating System as Indicator 16. There is a three year phase-in before districts have to comply with the 65% standard.

The rule includes librarians in the 65% calculation and includes food services cost in the calculation of the 35% non-instructional costs.

The current financial accounting/rating system is based on 21 indicators.  The new rule expands that to 26 items, including the phased-in requirement to spend 65% of operating money on direct classroom expenditures by 2008.  Other than some negative PR there is no penalty to a district if they meet any 20 of the 26 requirements.   If they fail to meet 7 of the indicators the district will have to submit a plan for corrective action to TEA.  Even if the district does not meet the phased-in 65% requirement, it can get full credit for that item with TEA by posting its check register (other than payroll expenditures) on the district website.  This is intended to meet the public need for transparency so the public can see how the district is spending tax dollars and then deal with the issue locally.

This does not change the current law that requires districts to publicize and hold a public hearing within 60 days of receiving their TEA financial accountability rating.

Other Changes: The new items include credit for maintaining a positive fund balance, having an academic rating above academically unacceptable, and additional points if the district is rated recognized or exemplary and points for exceeding prescribed levels of operating expenditures per WADA.

A couple of the revised items on the existing scale were also changed. In addition to the 65% rule, it increases the acceptable three year average tax collection rate from 96% to 98% and reduces the allowable variance in data quality from 4% to 3%.

It adds several new items to the information that has to be included in the annual financial report to the parents and taxpayers, including:

Most of the individuals who spoke at this hearing were people who didn’t speak at the first hearing. As expected, a lot more of the comments from the “citizen” members were in favor of the proposed 65% rule. 

While the participants at both task force meetings primarily staked out positions for or against the proposed rule, the Commissioner has been directed by the Governor to write a rule requiring 65% of funds be spend on instruction.  It is anticipated the two taskforces will meet jointly at least one more time to consider the input that was given.  The Commissioner has indicated that she will propose a rule sometime in the next three to six months and then a hearing will be held on the proposed rule. 

TSTA Position Paper on the Governor's Proposed 65% Mandate

The Governor announced in August that he was issuing an Executive Order to have TEA write rules that would require school districts to spend 65% of their budgets on instruction.

TSTA is calling the Governor's proposal an attempt to draw attention away from the fact that Texas' public schools are woefully under funded. By pretending to do something to help by mandating 65% of funding go to instructional needs, the Governor is hoping nobody will notice that the funding remains inadequate. 65% of inadequate is still inadequate.

The 65% campaign is part of a national movement called First Class Education. Some background information is included on them.

THE CONCEPT: By 2008, have all 50 states and D.C. mandate that 65 cents of every education dollar be spent "in the classroom."

PLAYERS: Patrick Byrne: CEO of Overstock.com; Salt Lake City, UT; Contributed $50,000 in 2004 to All Children Matter, the pro-voucher PAC that worked to defeat Utah state legislators who voted against tuition tax credits. His real motivation was revealed when George Will wrote: "(Warren) Buffett also advised Byrne to ask himself this: If you had a silver bullet, what competitor would you shoot, and why? Byrne says he would shoot the National Education Association -- the largest teachers union. Byrne...relishes the prospect of the 65 percent requirement pitting teachers against other union members who are in the education bureaucracy."

GROVER NORQUIST: The leader of the national anti-tax movement. He made the first endorsement of the First Class Education concept on the group's web site.

Their purpose is described in an internal memo which states:

"While voucher and charter school proposals have great merit, large segments of the voting public--especially suburban, affluent women voters--view these ideas as an abandonment of public education. Women in particular want public education fixed, not replaced. Once additional fixing and funding of public education can be achieved via the 1st Class Education proposal, target segments of voters may be more greatly predisposed to supporting voucher and charter school proposals, as Republicans address the voting public with greater credibility on public education issues."

TSTA Position on the 65% Mandate

• The Governor's proposal is an attempt to draw attention away from the fact that Texas' public schools are woefully under funded. By pretending to do something to help by mandating 65% of funding go to instructional needs, the Governor is hoping nobody will notice that the funding remains inadequate. 65% of inadequate is still inadequate.

• TSTA has long argued that there should be greater accountability and transparency at the local level, but such measures alone do nothing to provide a long-term school finance solution.

• After two regular sessions and three special sessions, the governor is using campaign-style media events in an attempt to divert attention from a well-documented failure of leadership. By creating an image of "leadership" through a proposal that sounds good but solves nothing, the Governor hopes to avoid blame for failing to step up and work to deliver the resources our schools need to meet the mandates the state would place on them.

• Proposals such as the "65% mandate" fail to address the central issue--adequate and equitable funding--and the Governor is hoping "sound bite solutions" allow him to duck the responsibility required to provide real leadership for a real solution.

• When the state pays for only 37% of our children's education and local taxpayers pay 63%, the state should have no right to dictate how 65% of all education money gets spent. No one has heard the Governor propose a plan that requires the state to pay up 65% of the money.

• Counselors, nurses, librarians, security personnel, diagnosticians - in short - no one who provides support for instruction is included in the definition of "instructional expenditures."

• The 65% mandate sounds too good to be true, because it is. This proposal lays the ground work for the argument that the schools wouldn't need additional funding if they just used existing funds more efficiently. This media tour is an obvious effort to divert attention away from three failed special sessions on public school finance. The current school finance system has been declared unconstitutional, and all we get for "leadership" is a media campaign that does not address the central issues in the court case.

• The organizations promoting the 65% mandate nationally have said the goal of the 65% gambit is pitting different groups of educators against each other in a fight for dwindling resources.

John Young: Puppetmasters from Afar

August 3, 2006: The state has delivered its annual apples-to-banana-peppers comparisons of public schools.

Not surprisingly, the students in hypothetical New Utopia Valley ISD, where the SUVs roam free, did very well. Meanwhile, test scores weren’t so hot in Under the Overpass ISD, where the biggest business opportunity is hubcap reclamation.

Amid the twitter about “exemplary” and “failing” schools — almost invariably dictated by the cubic feet of passenger room waiting to pick the kids up at the bell — Texas now has yet another way to categorize from a distance.

Recently, Gov. Rick Perry announced that schools would be judged in the state’s “financial accountability” system on the percentage of money spent on “instructional” purposes.

Meaning what? That question was answered this week in criteria the Texas Education Agency has built around the “65 percent rule.” That’s a gimmick now en vogue in some circles that aren’t exactly friends of public schools.

Fascinating: In a professed effort to curb bureaucracy, the state is imposing two new strata of gobbledygook — one based on the federal definition of “instruction” and the other on a broader state definition.

Under either standard, such things as administration, security, maintenance, transportation and food service are in the wedge of budget pie deemed not “instructional.”

What this means is that if a district needs a $30 wrench to deal with a burst pipe, in effect it must justify the expense with $60 spent on a “classroom” need as defined by the state. Or, the district gets dinged by the state for foolishly allocating money.

It’s a grotesque take on the childhood game, “Mother May I?” And this from politicians who tout “local control” of schools.

Talk about a fool’s errand. Talk about “one size fits all” follies.

For instance, the hypothetical inner-city Under the Overpass ISD reasonably might require more dollars per capita for security. Meanwhile, fictitious New Utopia Valley, with its vast green meadows and ranch estates, might need more for transportation per capita.

Who is Perry to say that these costs are not wholly indispensible to educating children?

For such good reasons, attempts to adopt a 65 percent rule have failed in the Legislature. Perry decided to implement it anyway.

The 65 percent rule is “one of the worst ideas in education.” That’s not the National Education Association talking. That’s the teachers union’s sometime nemesis, former U.S. Secretary of Education Rodney Paige.

“The most likely outcome is that school officials will learn the art of creative accounting,” wrote Paige in a New York Times commentary.

“More ominously, it will tie school leaders’ hands at a time when they need more freedom to innovate.”

A study by Standard & Poors found the 65 percent standard to be irrelevant if the concern is student performance.

So, from where does this specious idea come? For one, from a national movement bankrolled by Patrick Byrne, CEO of Overstock.com.

Another key player is a man who regularly has our governor’s ear: anti-tax crusader Grover Norquist, friend to anti-tax presidents and felons alike. (Convicted influence peddler Jack Abramoff is Norquist’s college-days chum.)

Sometimes, one wonders if Perry is more intent on pleasing Norquist than in schools that educate or state government that works.

Perry has touted the pet cause of Norquist’s Americans for Tax Reform: a “taxpayer’s bill of rights” with crippling caps on local property taxes and appraisals. He signed Norquist’s Taxpayer Protection Pledge against ever raising taxes.

Now, he takes Norquist’s advice on how to run our schools from afar. Who put him in charge over our schools’ every budget decision? Apparently you did, dear voter.

John Young’s column appears Thursday and Sunday. E-mail: jyoung@wacotrib.com.

Lawmakers are from Mars. Educators are from Venus.

You don't have to look much further than the 65 percent rule – touted in some political circles as the answer to a broken education system – to see that the two camps don't even speak the same language.

The concept is simple: Schools must spend 65 percent of their operational budgets on "classroom instruction." You fix schools without raising taxes. No wonder it's catching on among Republicans from Texas to Georgia to South Carolina. In Oregon, a signature campaign is under way to get Initiative 131 on the ballot. In Missouri, Gov. Matt Blunt has said he wants voters to have their say in the next election.

If it sounds too good to be true, it probably is.

In the sound-byte-peddling world of Mars, if you can package it, you can sell it.

But on Venus, things are a bit more complicated. Catchy phrases and good intentions just don't cut it.

Some GOP legislators see the 65 percent rule as divine intervention, a way to whip those fat school districts into shape.

I'm sure some school districts can shed some fat, and, frankly, a few need to clean house. (And let's hope Katrina's aftermath constantly reminds us of the consequences of cronyism.) That said, all this political talk makes it seem as if school districts are overrun by corrupt, greedy administrators who only know how to put out their hands and demand más.

In Texas, almost two of three school districts already spend 65 percent of their operating budgets in the classroom. And I doubt you'll find too many educators who will disagree with the general premise behind the 65 percent rule.

But let's not be naïve. The 65 percent "solution" leaves out other components vital to academic performance: good teachers and competent administrators, adequately funded programs and smaller class sizes.

Parents and taxpayers should dig below the headlines and not let these politicos off the hook. Lawmakers still have to figure out how to finance our schools. If they don't, this 65 percent rule is worth closer to 65 cents.

Most of the 65 percent state proposals floating around hew to the federal definition for classroom funding. Parents, take note:

Football is in, computer labs are out. The band instructor counts, but the librarian, nurse and counselors don't. Neither do transportation, cafeteria workers and custodians, all needed to run a school.

With these kinds of discrepancies, one has to wonder how much thought politicians gave this proposal beyond the sales pitch from First Class Education, the Washington group whose goal is to get the 65 percent rule on the books of all 50 states and the District of Columbia in the next three years.

Let's make one thing clear: There is no such thing as one-size-fits-all when it comes to education. A rural school district may spend more money on transportation than an inner-city district. In Dallas, where 80 percent of the students are from low-income families, counselors are crucial to keeping more kids from dropping out.

If anything, most school districts could use more counselors. Since standardized testing became the only way to measure student success, counselors have become glorified test coordinators, too busy adhering to state and federal mandates to spend quality time with students. Our GOP leaders can't take credit for demanding higher standards if they don't pull out the wad of cash, too. Upgrades cost money. No way around that.

I do have a glimmer of hope, though.

Right now, the Texas Education Agency is trying to figure out how to define "classroom instruction," and I'm relieved to hear they're listening to educators. I know if my car were broken, I'd take it to a mechanic, not an accountant.

And if politicians visited Venus more often, they'd find a world beyond ribbon-cutting ceremonies and career days. And instead of dismissing those from Venus as the Whiny Ass School People, they'd realize they can't fix this mess without them.

Macarena Hernández is a Dallas Morning News editorial columnist. Her e-mail address is mhernandez@dallasnews.com