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 * Finance Week 3 Part 3 Group 3 **


 * WADA **

The State of Texas makes an attempt to equalize funding for all schools. This week, we have taken a look at two similarly sized districts and have found that the equalization of funds has not occurred. We will take a look at the intent of Weighted Average Daily Attendance (WADA) and why the action failed in the comparison of these two districts. We will also address the potential positive and negative impact these differences make on the programs funded under Maintenance and Operations (M&O). The intent of WADA is to provide more professionals, materials and programs for students that are economically disadvantaged and or underachieving. WADA takes into account groups such as Bilingual, Limited English Proficient, Gifted and Talented, Special Education, and Career and Technology Education. These special populations take more funds to educate. The way WADA is calculated is complex; however the end result is a number that will be greater than the Average Daily Attendance (ADA). WADA is greater because the formula to attain the number takes into account the type students that are being served by a district. The greater the number of students eligible for special entitlements, the greater a school district’s WADA will be. The Summary of Finances studied for these districts indicate that the district with the greater property values, District Two, is able to hire more teachers and other staff, even though an equalization of funding is supposed to occur. The equalization of funding failed in this case, even though the percentage of Economically Disadvantaged students in District One is more than four times higher than in District Two, District Two is a “richer” district based on local property values that increase its Total Target Revenue. District Two was able to collect substantially more WADA funds at the compressed rate than District One which will greatly impact the students of both districts.


 * Program Differences **

The intent of the WADA is to help districts who do not receive as much money from local revenue. From this, District 2 has a significantly larger amount of teachers than District 1. This comes from the difference in the revenue brought into the district. District 1 has a larger ECD percentage than District 2, so they have become to receive more funding to make up for the reduced amount of tax money. This increase in funding has helped with different programs for District 1. They receive more funding for Special Education than District 2. District 1 also receives more funding for Career and Technology, Compensatory Education, and Bilingual Education. The difference between some of these programs is due to District 1 having a 100% Hispanic Population along with a 93.3% Economic Disadvantaged Population. This is different for District 2 because they have a smaller Hispanic population which is why they may not need as much bilingual funding. The number of students per teacher is about the same in both districts. The Compensatory Education money is due to the high number of Economic Disadvantaged students that District 1 has. This allows the district to have some of the same types of programs that other districts have. The money for Career and Technology is larger for District 2 because they may need more students ready for work as they graduate. Since this community has a high number of economic disadvantaged families, many students must go to work, so the Career and Technology program is a must for this school. This program will prepare students for jobs when they graduate so they are ready to enter into society if they need to. District 2 has more teachers than District 1, which is due to the funding that District 2 has. This increase of funding is primarily due to the larger property values in District 2. This means that they may be able to have more intervention teachers than District 1 which also will help raise student scores. Seeing the differences in both districts allows District 1 some of the same opportunities that students in District 2 have. With public school funding, we are able to see how schools differ with programs since the difference is due to funding and total revenue for each district. Since those amounts are different, each district may be equipped differently and may have different programs that each district may need rather than them being the same across the board.


 * Positive Impact **

M&O funding is a combination of local tax revenue and funding from the State of Texas. These are the funding sources used to operate the school district. Some districts generate a larger part of their M&O from local tax revenue and others receive most of their funds from the State. Those districts that have larger property value are able to garner more M&O tax collection at the local level. These “richer” districts receive less money from the State who utilizes the funds they do not send to help other districts. As a result, the "poorer" districts are positively impacted because they receive a larger portion of State funds. The districts with larger property wealth are able to raise additional monies through the “pennies” system developed by the State. Additional monies can be added by the Board of Trustees voting to invoke the use some pennies. These additional funds positively impact the programs in those districts because of increased tax collection. Most of these funds are utilized in the instructional program and can be used to hire more teachers or staff to help students succeed. Also the additional funds can be utilized for tutorial programs before or after school and in the summer. These funds can improve student understanding by either catching them up during the school year or at the end of the year to make sure they are ready for the subsequent grade. The wealthier districts also have the opportunity to add additional pennies and raise more funds if the community votes to allow the additional taxes. These larger property wealth districts usually have people in the community and parents that are concerned with providing a quality educational program to their local students. As a result they are willing to vote yes and add more money to the district budget if they are made aware of how the money will positively impact the district's students. Districts with larger funding are also able to maintain a larger fund balance. The fund balance has a variety of potential positive impacts on a district during the school year. For example, new technologies may come available that will allow students additional access to the Internet or be able to augment the CTE program. Fund balance may also positively impact the district because those funds can be used after a natural disaster such as a hurricane to quickly return the district to a normal status or they could be used when a portion of a school develops foundation problems and is closed for occupancy by the local city. Any time funds are readily available to a district they can react more quickly in times of crisis or opportunity and those actions positively impact the school district. **Negative Impact ** The negative impact truly hits the "poorer" districts when it comes to enrichment. They do not have the ability to raise additional funds and enrich their student's education. They rely on their state funding to meet the minimum needs of their students. They also have an inability to build up large reserves and need each check they receive from the state to keep programs viable. This existence negatively impacts the ability of the district's administration to move their district forward. Each time the Legislature meets they wait to see if changes will occur that really affect their budget and ability to provide a 21st century education to their students. Meeting just the educational minimum in today's society is a detriment to those students who deserve so much more.