10/19/2006

Editorial

Proposal 5 would soak up funding for other services

As a feel-good measure, state ballot Proposal 5 has a lot going for it.

Unfortunately, it's also a disaster waiting to happen and deserves a "no" vote Nov. 7.

The proposal would: Increase current funding for education — from K-12 through higher ed — by about $565 million; guarantee increases equal to the rate of inflation; make up any shortfalls in the school aid fund from the general fund; allow districts to average student enrollment over three years; reduce the inequity gap between districts getting basic funding and those getting the most from the state.

That all sounds great. But there's a skunk in the woodpile. Proposal 5 would also reduce and cap employee retirement fund payments made by schools, colleges and state universities and force the state to come up with the rest.

That would be good news for schools. Payments to employee retirement funds are already one of the biggest single outlays for most districts, and will only get worse as many long-term employees retire over the next few years.

Shifting the burden to the state would, however, be a financial disaster. It's a one-problem solution that makes solving the myriad other problems the state faces much more difficult. Teachers pensions would be guaranteed, but at an enormous cost. It's bad public policy and needs to be rejected.

A non-partisan Citizens Research Council analysis estimates that Proposal 5 would cost the state $565 to $707 million in fiscal year 2007; the percentage of the state budget that would go to education would rise from 21 percent to 27 percent.

While the analysis says the mandated yearly increases in school funding to keep up with inflation could likely be met, the drain created by the retirement fund provision would likely exceed inflation and eat into other General Fund obligations. Simply put, the retirement provision would cannibalize other General Fund spending.

Vote "no" on Proposal 5.