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Rounds Says Ax K-12 Education 5%: I Say Invest in Students

Yesterday the Associated School Boards of South Dakota called on the Legislature to follow the law and increase K-12 education funding by 1.3%. That's a pretty modest request, given that ASBSD's position for the past few years has been to call for an overhaul of the funding formula that would direct much more money toward K-12 education.

Hours later, outgoing Governor M. Michael Rounds called on the Legislature to change the law and cut K-12 education funding by 5%. That follows the Legislature's move last session to rewrite statute and yank a promised 1.2% increase out from under our schools.

This K-12 cut saves $23 million total. The governor's proposed budget, which he'll lay out in Pierre this afternoon (covered live on SDPB), still leaves a $37 million deficit.

There's Mike Rounds's legacy: years of structural deficits that neither he nor the Republican Legislature had the guts to fix. Rounds's limp fiscal policy doesn't even qualify him as a caretaker governor. Today's budget address promises to be one more wimp-out.

So let's talk guts: is it really less painful to nickel-and-dime our teachers and kids than it is to cowboy up and raise our taxes? We have about 100,000 students [2010.12.09: whoops! update that: 123,629 students!]... which leaves about 700,000 of us South Dakotans to pay taxes. Governor Rounds says short each kid $240. I say charge each taxpayer an extra $33 to keep education funded at its already paltry level.

Thing is, you and I are going to end up making up the difference anyway. Odds are your school district and mine will not take a 5% cut. If Governor-Elect Daugaard and Majority Leader Russell Olson pass this plan, you will see opt-outs spring up almost everywhere, as local districts try to fill the gap. Taxes will go up for many South Dakota taxpayers anyway; Governor Rounds just doesn't have the guts to be the one to ask for it.

The odd thing is that we have the wealth to withstand a tax increase. South Dakota technically never joined the recession: our economy has grown each year. Our GDP went up 2.2% in 2009, and I don't see data suggesting less growth this year (though I'm open to counter-evidence). The new South Dakota Budget & Policy Project (oh my: this website looks really cool!) says sales tax revenues are looking up.

Our tax system is clearly not tapping the wealth our state is creating. In other words, we aren't paying the full price of civil society, the cost of maintaining the schools our kids need and that make our wealth-creation possible.

Maybe we shouldn't get all hot. Maybe this mad-axeman budget is just Governor Rounds's parting gift to his lieutenant, who come January can ride in and save the day with improved revenue projections and a noble compromise that changes the funding formula to only freeze K-12 funding again rather than cutting it 5%.

In the understatement of the week, Mr. Crissman at DWC calls 5% "noticeable." I call Rounds's farewell proposal irresponsible. It's a non-starter: no guts, no vision, no sense of basic social obligation. Governor Rounds leaves affirming the South Dakota Republican belief that education is an expense, not an investment.

Bonus Timing: Governor Rounds's official portrait will be unveiled for public viewing following the budget address. Expect tepid applause... and maybe some Post-It note mustaches.

Update 07:45 CST: At least we're not California. But Marc Albert's comment on the California situation has relevance here in South Dakota:

Hyperbole or not, much of the chaos could be avoided by finally convincing state taxpayers that you can't get something for nothing forever. There may be waste and fraud in the public sector, but not $25 billion worth. Complain about lousy teachers, public pensions and long lines at the DMV all you want — it isn't going to change the figures on the ledger [Marc Albert, "California's Public Schools in Downward Spiral," Understanding Government, 2010.12.07].


  1. Tony Amert 2010.12.07


    Just a note, the NYU system just finished a 3 year, $1 billion research campus development project. The campus was structured in such a fashion that it didn't even have targeted technologies before development started.

    But, they understand that such investments pay for themselves with huge dividends over the next 5-10 years. Researchers will move in, intellectual property will be captured, and companies will be formed.

    They have the long term planning to know that sometimes investments in such things take a long time to payoff (note that they have done this before, this is the 7th such campus over the last 30 years).

    The structural problem that we run into in SD is that no one looks beyond 3 years. Why educate a 3rd grader if it won't pay off for another 20 years?

    Things will only change with a charismatic leader to push a new, long term vision paradigm rather than these short term apologists that we have been electing.

    Even our friends in North Dakota have recognized the need for long term investment. For FY2010 they invested almost 10x more into their university system for research than we did (note, research, not general teaching budget).

  2. caheidelberger 2010.12.08

    Good points, Tony. I heard nothing in Rounds's farewell budget that talked much beyond the next three years. This budget was all about balancing the FY2012 books, not about really putting our tax dollars to work. Even if you're broke (and our state is not), you still have to plan ahead.

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