Employment and Barriers to Independence
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Education
Education Aid before Thornton
Maryland relies more heavily on local governments to collect taxes and pay for government services than the vast majority of states. This financing arrangement works out well for wealthier jurisdictions, but not so well for those who live in jurisdictions where the residents have lower incomes or where there is a greater need for government-funded services.
Education is one service area where there are consequences to this arrangement where local governments pay a higher share of the costs of services.
Prior to enactment of Thornton, local governments paid 53 percent of education costs (on average) while the state share of costs was 39 percent. In 2001-2002 local governments in only four states paid for a greater share of education costs. Alternatively, the state share of education costs was smaller in only three states (source is The Fact Book 2002-2003, Maryland State Department of Education).
The lower state share largely resulted from a state funding formula that guaranteed that the state would pay a minority of the costs of education.
Under prior law, the starting point for calculating the state's share of education costs was to take 75 percent of statewide per pupil costs from three and four years earlier. For example, in 2001, the "benchmark" per pupil spending level was $4,005, which was equal to 75 percent of the average per pupil costs in 1997 and 1998.
The formula then assumed that this benchmark figure would be equally funded by the state and local governments. Thus, the state's share was calculated to be half of the $4,005 benchmark cost, or $2,002.50.
Working through the steps in the formula thus far results in a state aid level equal to 37.5 percent of average per pupil costs from three and four years earlier.
From this baseline level other adjustments were made based on a jurisdiction's wealth status. This resulted in some jurisdictions receiving more than $2,002.50 per pupil and some receiving less. For example, in 2001, after adjustments, Baltimore City received $2,973 per pupil (the most of any jurisdiction) and Worcester County received $492 per pupil (the least of any jurisdiction). In both cases, the funding formula was well below the actual statewide per pupil cost of $8,351 in 2001-2002.
In part because of the inadequacies in the funding formula, policymakers began to enhance or create other education funding programs in addition to what was provided under the benchmark formula. These programs targeted areas such as special education and transportation. Over time, the state had created more than 40 other education funding programs. Many of these other programs had wealth adjustment factors, some were based on enrollments, and some were outright grants.
Despite the proliferation of these other programs, the primary form of state aid remained the inadequate benchmark formula.
The Thornton law consolidates these multiple education aid programs into just four funding programs, and substantially increases the overall share of education costs that will be contributed by the state. Further, the state funding level under Thornton is now tied to an estimate of how much money is needed to provide students with an adequate education. MBTPI