Running Head: Proposal A Paper

Proposal A Paper

Jenny Gieselman

Oakland University

EA 8840

March 15, 2018

Introduction
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Proposal A dramatically changed funding for Michigan tax payers (Price, 2017). This

paper will highlight the impact of school funding after proposal A, advantages and disadvantages

of proposal A, as well as give the opinion of whether Proposal A should remain, based on the

facts that were found.

Impact of Proposal A on Local School District Funding

According to A Primer on Michigan School Finance Proposal A had four major goals

(Kearney & Addonizio, p. 38, 2002):

1. Reduce Property Tax

2. Improve School Funding Equity

3. Implement Various Reforms to Improve the Quality of Education

4. Redefine State and Local Government Regulations

Before Proposal A, schools were mainly funded by local property tax and high millage

rates. These millage rates helped cover the costs of school operations. Before Proposal A voters

decided how many mills they wanted to levy, the state would guarantee an amount for every

district, based on a District power Equalizing Formula, but mainly most the per pupil money

came from the local taxpayers. This left Michigan’s property taxes at a high rate and voters were

wanting a change (Price, 2017).

Prior to Proposal A 177 school districts were “out of formula,” which ultimately meant

they received no state aid. This system made our schools inequitable (Price, 2017).

With Proposal A, voters agreed to pay a 6% sales tax, as compared to 4%. This has left

sales tax as the primary source of revenue for Michigan schools.

Advantages of Proposal A
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The evidence shows that pupil funding has increased for school districts since Proposal A

was put into place. Looking at Table 6 on page 13 in A Primer on Michigan School Finance,

some districts saw an increase of 54% for per pupil funding (Kearney & Addonizio, 2002) .

According to the chart Proposal A made funding more equitable compared to Michigan’s prior

system. Ultimately Proposal A did improve school funding equity.

“Although an equity problem continues to exist in Michigan school funding progress has

been made since Proposal A, as evidence by the fact that 343 districts now have identical

foundation grants” (Price, 39, 2017). As one can see not all is bad with Proposal A. Per pupil

allowance did improve for districts.

According to Kearney and Addonizio, one of the major goals for Proposal A was to

reduce the state of Michigan’s property taxes, this did happen. Infact, property taxes were

reduced by about 26% (2002).

The state of Michigan is responsible for 79% of school funding, as compared to the 26%

prior to Proposal A. This took strain off local communities property taxes and financial

obligations for school funding (Kearney & Addonizion, 2002).

Disadvantages of Proposal A

One of the biggest disadvantages of Proposal A is that the school districts rely heavily on

Michigan’s economy, we saw the effects of this up until just recently, when our state went

through a major recession and loss of population.

Under Proposal A property tax is still a big part of school funding. Districts have minimal

chances to raise their own revenue. According to Kearney & Addonizio in 1993-94 the

statewide average tax for school operations was 34 mills, under Proposal A most districts went to

6 mills on homestead and 24 on non-homestead property. Even with the 3 mills allowed with
Proposal A Paper 3

voter approval, it doesn’t bring most districts close to where they were (Kearney & Addonizio,

2002).

Another disadvantage is that funding is based on each pupil, meaning that for each child

lost, money is lost. Sometimes the amount of children lost aren’t enough to make major cuts, but

the money that is lost makes districts have to make cuts anyway (Pratt-Dawsey, 2014). In the

past five years 70% of traditional public schools have declining enrollment, resulting in less

funding for those districts (Outlaw, M, 2018).

With Proposal A came choice. The choice was intended to “implement various reforms

to improve the quality of education,” according to the goals of Proposal A. It certainly has

created choice. Under Proposal A charter schools are able to receive funding. According to A

Primer on Michigan School Finance charter schools have grown from 14 in 1994 to 187 in 2001.

In 2001 there were 64,510 students enrolled in charter schools. These students were more than

likely enrolled in a local public school at one time, meaning a loss of funding for the district

from which they came (Kearney & Addonizio, 2002).

Should it Remain?

While Proposal A did improve equity among districts there is still a lot of improvements

that need to be made. For this reason, changes should be considered.

The first issue that I feel should be considered is the funding gap among districts. I

believe this could be resolved by determining what is adequate for subgroups of populations in a

district. For example, special education and at-risk should receive more money than a general

education student that needs no support. So, rather than a flat per pupil rate, the state would give

different rates for different needs.

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Since the state is responsible for 79% of school funding under Proposal A, it seems as if

consolidation needs to be something that the state does consider. If districts aren’t willing to

consolidate then perhaps more funding costs get put on them locally. According to the National

Center for Education Statistics, Michigan has 891 school districts (2004). By consolidating these

districts there would be a greater chance for equity, because more funds and resources would be

coming together.

The state would also benefit by trying to increase our population. One idea is to give

incentives for businesses to start here in Michigan. The more non-homestead funds the better it

will be for state education funding.

Conclusion

While Proposal A made some positive impacts on funding for Michigan Public Schools

there are still many improvements that need to be made. One of the biggest improvements that

need to be addressed is equity among Michigan Public Schools. While equity did improve under

Proposal A, recent changes with Michigan’s economy and population have once again brought

up the issue of equity. Looking at adequacy would be a great benefit to the state as well, by

adjusting per pupil funding to look at sub groups. Not only would it potentially increase student

performance, but put the money where it will be most beneficial. This would certainly start

addressing the issue of equity as well.

Another idea, is to consolidate school districts. By consolidating, districts will be able to

share resources. Ultimately, this would be a savings to the State of Michigan, as well as once

again addressing the equity issue. The districts that don’t want to consolidate should have a

bigger burden locally, or perhaps there would be incentive to districts that do consolidate.
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While Proposal A did provide relief to Michigan tax payers and made districts more

equitable, changes still need to be addressed.

References

Kearney, C. & Addonizio, M (2002). A Primer on Michigan School Finance. Detroit: Wayne

State University Press.

Outlaw, M (2018). EA8840 Michigan School Finance, class 3 notes [PowerPoint slides].

Retrieved from https://moodle.oakland.edu/mod/folder/view.php?id=3015389

Pratt-Dawsey, C. (2014, May 1). A brief history of Proposal A, or how we got here. Retrieved

fromhttp://www.mlive.com/education/index.ssf/2014/04/a_brief_history_of_proposal_a.html
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Table 5. Number of public school districts, by locale code (CCD) and state: (2003-04). Retrieved

from https://nces.ed.gov/surveys/ruraled/TablesHTML/5localedistricts.asp