K-16 Funding Proposal

Official Policy
February 2006

Official Policy

The Ann Arbor Area Chamber of Commerce opposes the K-16 Coalition proposal to legally mandate inflationary increases in education funding in Michigan.  Education is very important to the future economic success of the Ann Arbor area, our members and our state.  However, it is inappropriate to provide automatic annual inflationary increases in education funding without requiring accountability.  It is also unwise to guarantee such a funding stream without providing any out clause for special circumstances given our state’s current budget situation. 

Background

The K-16 Coalition for Michigan’s Future is a group of statewide education organizations working together to obtain steady and reliable funding for public schools, community colleges and universities.  The coalition is currently pushing a ballot initiative that would do the following:

• Make inflationary increases in education funding the law in Michigan.  A ¾ vote of the legislature would be required to change this law.
• Cap local retirement contributions at a fixed percentage
• Reduce the funding gap between school districts

The Coalition has enough signatures to put the issue on the November ballot.  The signatures have been presented to the state legislature and the legislature has 40 days to vote on the proposal or reach a compromise with the Coalition. 

• A strong educational system is critical to the future of Michigan and is critical to the success of Chamber members.  It is a top priority service.
• Local school districts do not know what their funding stream is going to look like year to year and this makes long-term planning problematic.

Cons

• This proposal would most likely hurt other state services.  Because the state would be required to increase funding for education annually, cuts would likely have to be made in other areas.
• There is no accountability factor in this proposal.  Funding goes up every year no matter what.
• This proposal is inflexible and is very difficult to change.
• There is broad, bipartisan opposition to this proposal, including the business community, local governments and the Governor.