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Tuesday, March 03, 2009
APS OK With Tax Disparity
By Martin Salazar
Journal Staff Writer
About $105 million raised by new taxes to overhaul New Mexico's public school funding formula would be collected in Albuquerque, but city schools would get only about $57 million of the new money.
The state Taxation and Revenue Department estimates that roughly 30 percent of the $350 million in new tax revenues for the formula would come from Albuquerque under a measure being considered by state lawmakers.
Albuquerque Public Schools officials aren't wavering in their support for the new formula, although APS would get back only about 16 percent of the new money.
"We feel strongly that the funding formula needs to take place the change needs to take place," said APS lobbyist Joseph Escobedo. "And as far as how they fund that, I think they've done a great job in compromising."
Proponents of the new formula point to a study that found that New Mexico schools are underfunded by about 15 percent. The proposed formula would, among other things, extend the school year for students by five days to 185 by 2012. It would require schools to have an education plan for student success as part of their budget process. And districts with increased enrollment would immediately receive funding for the new students, unlike the current system, which requires 1 percent growth before a district gets extra money.
Some opponents in the Legislature have questioned the wisdom of a major tax increase during a severe recession, while others have said the measure needs accountability measures designed to make sure the new money equals progress.
The extra money for the proposed funding formula would be generated through a half-cent increase in the statewide gross receipts tax and an increase in the top rate of the personal income tax from 4.9 percent to 6 percent. A single person making $18,050 or more a year after exemptions falls into this bracket.
Reducing taxes was one of Gov. Bill Richardson's signature economic development achievements after he took office, along with trying to make the state more competitive with its neighbors in attracting economic growth and jobs.
Escobedo said the APS board supports "whatever funding mechanism the Legislature comes up with."
He said the proposed gross receipts tax increase means tourists would help foot the bill.
Two measures are pending before the House Appropriations and Finance Committee. The first would revamp the formula, while the second contains the tax increases to pay for the changes.
State lawmakers spent more than two hours Monday debating the merits of the funding formula change before opting to table the bills.
Several superintendents, school officials and union groups were on hand to voice support.
"I really implore you to find a way to fund this bill," said Santa Fe Public Schools Superintendent Bobbie Gutierrez. "... We're talking about our future in New Mexico, our children's future."
Among those speaking against the measures was Terri Cole, president and CEO of the Greater Albuquerque Chamber of Commerce.
Cole said the proposed funding formula doesn't contain enough accountability. She said the amount the state spends on public education has doubled over the past 12 years to $2.4 billion, yet the dropout rate remains high. She noted that the number of students has, for the most part, remained flat during that time.
Rep. Ray Begaye, D-Shiprock, said he worried about how school districts would spend the extra money, questioning whether they might spend it on pay raises for superintendents rather than on the classroom.
Rep. Mimi Stewart, the Albuquerque Democrat sponsoring the bills, said the new formula doesn't change the local control school boards have in deciding how money is spent.