Well, how did we get here?

The falling red line on this graph documents how Colorado’s per pupil funding compares to the national average from 1972-2007.  With conventional wisdom in and around the Capitol that K-12 funding is “fine” and has been protected – perhaps too protected – by Amendment 23, this graph tells the real story of Colorado’s 30 year history of disinvestment.  The downward trend started with the Gallagher Amendment in 1982 and continued to decline with the passage of TABOR in 1992.  Even with a slight increase following Amendment 23, Colorado continued dropping to new lows relative to the national average.  In 2007, Colorado was $1,397 below the national per pupil funding average.

In the 1980s, Colorado invested more per student than the national average, even during the energy bust.  In 1982, we passed the Gallagher Amendment (the vertical green line on the graph) – which started eroding the local property tax base by continually reducing the assessment rate (the percent of the value of a home that is taxed).   From 1982-1992, school districts were able to somewhat stabilize local revenues by floating mill rates up.

In 1992, TABOR was passed (the vertical orange line) and took away the ability of districts to float their mill rates without a vote of the people and limited the state’s ability to backfill the hole left by declining property tax rates (because of a 6% spending limit imposed on spending from the State General Fund).  The result: Colorado’s tangle of restrictive budget laws prevented the legislature from even keeping up with inflation in per pupil funding.

The good news is that in 2000, Colorado voters passed Amendment 23 to plug hemorrhaging P-12 budgets (the vertical purple line).  Estimates indicate that if Colorado did not pass Amendment 23, average spending per student would have dipped down an additional $500-1,000.  As the graph indicates, per pupil spending in 2000 was already nearly $700 per pupil below the national average.   At the time it passed, Amendment 23 was intended to be a floor and not a ceiling.

The bad news is that since 2000, Amendment 23 has become a ceiling and not the protective floor it was originally intended to be.  The other bad news is that the measure of inflation used in Amendment 23’s inflation + 1% for K-12 funding is based on the Consumer Price Index (CPI), and is not weighted to reflect the kinds of things that school districts buy like health care, pensions, and energy.

As you track the red line where Colorado falls relative to the national average, you can see that at one point, Colorado increases relative to the national average.   During the post-9/11 economic downturn in 2003, Amendment 23 protected Colorado’s schools more than those in the rest of the country.  But when the economy recovered, other states took action to remedy temporary cuts made in tough times.  In essence, while other states said: “finally we can invest in our kids again”, Colorado took a different path and funded schools barely above the minimum required by Amendment 23.

Consequently, Colorado’s per pupil funding has fallen off the chart over the past several years — a phenomenon that will only get worse in 2011, unless we work together to prevent “the Cliff.” (In 2011, Amendment 23 and Referendum C sunset, and the federal stimulus dollars that are currently propping up education funding will dry up.)

What can you do right now?  Take the Great Futures pledge to invest in kids, because great futures start with a great education.  Let’s match our resources with smart, sustainable reforms to impact all Colorado students.

Elsewhere, we’ve provided a visual representation of the fact that Colorado can’t sink much lower in higher education funding as compared with the rest of the United States. Here is a companion graph (click on the image to enlarge), showing that our competitiveness with our neighboring states on K-12 investment is just about equally grim.  (Note that Mississippi has passed us by . . .) Education Week’s annual Quality Counts state school finance data study is out, and the news isn’t good for Colorado.  Although Colorado earned an “A+” for funding “equity” (click on Colorado on the map found here), we earned a solid ‘F’ for “funding”.