New formula could cut funds, increase property-tax in some Coast districts

Meg Ormon and Mason Hunter play at a learning station in Kenna Elbin’s pre-K class at Martin Bluff Elementary School in Gautier. A new funding formula proposed in 2017 could cut the Pascagoula-Gautier School District’s budget by $14 million.
Meg Ormon and Mason Hunter play at a learning station in Kenna Elbin’s pre-K class at Martin Bluff Elementary School in Gautier. A new funding formula proposed in 2017 could cut the Pascagoula-Gautier School District’s budget by $14 million.

A new education funding formula could leave some Coast school districts with a difficult decision if it takes effect, including whether to request a property-tax increase of its residents or deal with substantial funding cuts.

EdBuild, the firm hired to re-evaluate the state’s funding formula, recently concluded an 80-page report that offers recommendations to legislators on what direction to take with education funding.

The Associated Press analyzed the report and found the new formula would mean a funding boost for 80 percent of schools across the state. But some, including many Coast districts, would get less money.

EdBuild’s report suggests “property rich” school districts should pay more.

“Relying on the state for such a large proportion of schools’ resources ... reduces the local funding responsibility for districts with large property tax bases, and has the effect of reducing the overall amount of resources available for education in the state,” EdBuild’s summary reads.

According to AP’s calculations, six out of 15 South Mississippi school districts would lose funding.

The biggest loser statewide would be Pascagoula-Gautier, where state aid would drop by $14,355,017 a year, or $2,022 per student.

The Biloxi School District would lose $4,060,327 a year, or $688 per student.

Because of the shipbuilding and casino industries, both districts are considered property-rich.

The Bay St. Louis-Waveland, Hancock County, Moss Point and Pass Christian school districts also would take a hit under the new formula.

How millage works

School boards use millage rates to calculate local school taxes, which are based on a school district’s property values. Those values vary.

One 1 mill is equivalent to $1 in taxes per $1,000 in taxable value. If a property has an appraised value of $100,000, a 1 mill tax rate equals $100 in taxes.

The millage rate cap is set at 55 mills.

In Pascagoula, the millage rate is 46.88. The Jackson County, Moss Point and Ocean Springs school districts are at or above the caps.

Similarly, while Biloxi’s millage rate is 37.96, the Gulfport and Harrison County school districts are 53.55 and 51.10, respectively.

Major hit to Moss Point

Surprisingly, the Moss Point School District seems to have fallen through the cracks with the new formula. The district — which has exceeded its millage cap — stands to lose close to $2.6 million in state funding. That’s a $1,262-per-student decrease.

The district benefited from a rarely used provision in the Mississippi Adequate Education Program formula called the “hold harmless” provision, which gives a school district the same amount of funding despite a decrease in enrollment. Only six districts in the state benefited from the provision. Moss Point would lose close to $1.7 million without it.

Moss Point has struggled over the years to comply with state standards. Recently, it has shown some improvement. Its graduation rate has improved dramatically. It also implemented additional pre-K learning classes to boost kindergarten readiness.

If the district doesn’t meet several other Education Department standards, however, it runs the risk of being taken over by the state. Additional funding cuts would make its climb that much more difficult.

Another big loser would be the Pass Christian School District. Pass Christian — whose millage rate of 51.76 is close to cap — would lose $914,827 under the formula, or $456 per student.

Tough choice

Districts that lose money would have two options: Cut spending or raise taxes.

And now, a recent House Bill will make the raising taxes part even more difficult.

Any proposed increase to property taxes by the school board now requires a voter referendum. House Bill 205 would require a referendum any time school boards seek to request an amount over 2 percent.

Pascagoula-Gautier School District Superintendent Wayne Rodolfich said he hasn’t requested a raise in property taxes for the past 11 years.

Rodolfich said property-tax increases would “absolutely” be in play. And that’s not the only thing.

“You get hit with that big of dent and there’s going to need to be a wide range of things the school district will have do,” he said.

He ticked off the aspects of his district that would need to be reconsidered. “All the programs we’ve built over a 12-year period, everything we do. Class size. The amount of technology in the classroom. Teacher salary.”

Pascagoula-Gautier had the highest average teacher salary — $48,926 — of any district in the state in the 2014-15 school year, according to figures compiled by the Education Department. Biloxi had the second-highest average at $48,090.

Based on average daily attendance from the same MDE data, Pascagoula-Gautier had the smallest class size in South Mississippi with about 12 students for every teacher.

Rodolfich said he approaches the funding-formula recommendations to his district from a “capitalist” standpoint.

“What we do with property taxes is create competition to attract industry or people to the community. If this (formula) comes about, it won’t be up to the school board that taxes are raised, it’ll be an action of the Mississippi legislature.”

Making the property-tax increase less tenable is a measure passed by the state Legislature on Wednesday. It would require a voter referendum on property-tax increases. If a referendum is voted down, school districts’ only alternative would be to cut expenses.

Ocean Springs is at its millage cap. It stands to receive $2,256,770 in additional funding, or $395 per student, under the new formula, according to AP.

Ocean Springs School District Superintendent Bonita Coleman-Potter said for her district, EdBuild’s formula seems equitable.

“It’s not my place to make a judgment,” she said. “But you look at Ocean Springs, you see that we are at our millage cap. Compared to some other districts, we pay a lot more. So, it’s a good thing for equity.”

Coleman-Potter said she was surprised at EdBuild’s suggestion that the state is paying too much for education. The report said the state spends a disproportionately high amount on education.

Her biggest concern is that the state not continuously make changes to the formula or funding amounts.

“We need a reliable, set amount. We need something predictable, something we can prepare for and work with,” she said.

Formula winners

Nine South Mississippi school districts stand to benefit from the EdBuild funding formula. They include the George County, Gulfport, Harrison County, Jackson County , Pearl River County, Picayune, Long Beach, Ocean Springs and Stone County school districts. The biggest winner would be Stone County, which would get an additional $1,144,654 in funding, which equals an extra $438 per student.

Full funding

Advocates of a fully funded MAEP program say the key issue isn’t the formula, but whether the state funds it.

MAEP has been fully funded only twice in 12 years, both in election years.

Rodolfich, like many educators, has questioned the logic of hiring an outside firm rather than just fully funding the formula that is in place.

“It’s hard for me to understand how you can make a comparison to a formula that was never fully funded,” he said. “Rather than see if that works, you come up with something completely new and untested.”

One of EdBuild’s recommendations Rodolfich agreed with is a proposal that additional money be spent on classes for non-native English speakers. EdBuild also proposes using a weighted formula for special education, vocational education, gifted education and career and technical education students.

According to Department of Education data, Pascagoula-Gautier has almost 18 percent Hispanic students, compared with the state average of less than 5 percent. Nine percent of the district’s students are learning English.

The full recommendations presented by EdBuild will be incorporated into a bill that will go through the normal legislative process starting in the education committees.

EdBuild recommended legislators phase in its recommendations over the next five to eight years.

Justin Vicory: 228-896-2326, @justinvicory