School choice and taxpayers

In the final weeks before the expansion of the choice program, Tom Barrett made a major issue about the unfairness of the funding formula. This theme was picked up by others who would have opposed the expansion no matter what the funding.

The biggest problem for Barrett was that he entered the issue late. If he had been working from the beginning to both expand the number of seats and to change the funding, he would have been in a much stronger position--especially if he could have also promised some Milwaukee votes for such a package. As it was, he entered too late and too negatively to be part of the compromise. On the plus side he did help generate a recognition of the need to reexamine the funding formula.

Assuming choice school enrollment expands by one thousand in the next couple of years, the additional cost to Milwaukee taxpayers would be about one million dollars. One might compare this to the many millions Milwaukee under Barrett has been willing to give as subsidies to projects like Pabst City and Manpower. If a recent study by the Public Policy Forum concluding that choice enrollment is flattening is correct, this estimate might be high, particularly if the additional requirements under the bill discourage the opening of new schools. On the other side the bill has economic advantages for Milwaukee. Choice schools can be regarded economically as small businesses, usually located in the most economically inert parts of the city. Much of the additional SAGE money will go to Milwaukee to hire additional MPS teachers who are required to live in the city.

One element not noticed in the whole controversy was the funding of non-MPS charter schools--those chartered by the city, UWM, or (potentially) by MATC. Unless the formula has changed since I was involved, these schools are largely funded directly by the state. So the switch of a student from MPS to one of these schools saves money for Milwaukee taxpayers.

If I were Barrett's legislative advisor, I would suggest the following:

1. Discard his proposal of simply holding Milwaukee taxpayers harmless for additional choice enrollment. It is both too modest and an unnecessary complication to the funding formula. Instead, go back to the proposal of several years ago to include choice and charter students in the MPS count. This would mean that both Milwaukee and out-state taxpayers benefit when students move from MPS to the lower-cost choice program. When originally introduced, this measure was supported by Republicans but died from lack of Democratic support. So the mayor would need to line up support for it among Milwaukee Democrats.
2. Aggressively promote expansion of the city, UWM, and MATC charter programs. In the short run, this would save Milwaukee taxpayers money, particularly if schools chartered by MPS were encouraged to defect. In the long run, it would increase the mayor's bargaining power in the legislature, since Milwaukee then would be giving something up in the move to fairer funding.