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The Ohio
Education
Gadfly A Special Edition from the Thomas B. Fordham Institute
Volume 5, Number 13. June 30, 2011.

Special Edition

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Ohio’s Biennial Budget Sets the Conditions for Education Success
By Terry Ryan, Emmy Partin, and Jamie Davies O’Leary

Gov. John Kasich is slated to sign Ohio’s biennial budget today (it’s a 5,000 page document), legislation that not only appropriates funding for the Buckeye State until 2013 but that also includes hundreds of pages of education-policy changes—most of which will move Ohio forward in significant ways.

The ultimate success of the budget’s education reforms will depend greatly on the quality of implementation by the State Board of Education, the new state superintendent, and his team at the Ohio Department of Education. This may sound obvious, but it’s worth hammering home: The budget puts an enormous amount of responsibility and faith into the Department of Education (to sponsor new charter schools, a move we opposed during the debate), the State Board (to approve model frameworks for teacher evaluation), and already thinly-stretched staffers who are still deciphering what the budget provisions actually mean.

Now that the legislative debate has ended, where does Ohio stand on the big education-policy issues of charter schools, teacher policy, and school accountability and improvement? And why will implementation be so crucial? Let’s dig in.

Charters & Choice

Fordham is a long-time supporter of school choice and believes in the expansion of quality options for families. However, we made it clear in recent months that we opposed proposals in the House that would have severely undermined accountability and the quality of authorizers and charter schools. Thankfully, the most egregious House language offered by some for-profit school-management companies was stripped out in the final budget deal, so Ohioans need not worry about charter schools or groups of individuals running schools without oversight. Plus, lawmakers strengthened accountability for charter-school authorizers, stipulating that those ranked in the bottom 20 percent of all sponsors cannot open new schools.

Other positive provisions include: shortening by one year the timeline for automatic closure (“death penalty”) of failing charter schools; putting in language to establish and fund a public boarding school; giving charter schools better access to unused district facilities; and dramatically expanding the number of EdChoice Scholarships available and the students eligible for them. The budget also launched a new special-needs scholarship program.

On the troubling side, the budget reinstates the Ohio Department of Education as an authorizer of charter schools, a duty it fully botched a decade ago, with many risks remaining today. These risks include an understaffed and ill-prepared charter-school office, conflicts of interest (the department now will sponsor schools, oversee the state’s other charter-school sponsors, provide technical assistance of myriad sorts, and fund charters), and enormous pressure to sponsor charter schools quickly and without a proper vetting of applicants. However, a rigorous screening process, combined with strong leadership from the State Board and the interim and new state superintendent, can help mitigate these risks.

Teachers

While not as strong as language approved in the House, the final budget deal is still two steps forward for the Buckeye State when it comes to improving teacher effectiveness. Most critically, Ohio districts will now have to dramatically improve their teacher-evaluation systems, and must no longer make layoff decisions based on seniority alone.

Moreover, the legislature wants to see action quickly—maybe even too quickly. By December 31, 2011, the State Board must develop a model evaluation framework to guide the development of local evaluation systems. Those systems must be in place by July 2013, and must base 50 percent of a teacher’s rating on the academic growth of his or her students. The systems also must rate teachers according to four tiers (accomplished, proficient, developing, and ineffective). School districts—rather than the state—will then decide how to tie policies on dismissal, tenure, retention, and pay to the evaluations. The primary state mandate governing all of this is that districts can no longer make seniority the predominant determiner of layoff decisions, except in cases of a tie (when teachers have the same rating).

Merit pay, one of the more controversial provisions debated during the budget process, will now only be mandated in districts, STEM schools, and charter schools participating in Race to the Top. Others will be encouraged, but not required, to create a performance-based salary schedule, and hopefully an abundance of teacher-effectiveness data accumulating over time will prompt local officials to reward highly effective teachers accordingly. Other provisions worth lauding include: Teach For America applicants won’t face any new barriers to entry, and alternative licensure will extend across all grades (K-12, instead of only grades 4-12). Teachers at the state’s persistently lowest-performing schools will be required to be tested on their subject-matter knowledge, but will not incur the costs of exams or be required to take the test more than once every three years provided they pass it. Finally, the Board of Regents’ Chancellor will report aggregate student growth data and trace these data to teacher graduates from various teacher-prep programs.

Accountability and School Improvement

Fordham has long advocated holding all schools accountable for performance (not just charter schools) and the budget does that well. District schools performing in the bottom 5 percent of schools statewide for three or more consecutive years will undergo major restructuring (“turnaround”). The controversial “parent trigger”—whereby parents and families can precipitate school reconstitution—will be piloted within Columbus City Schools. Schools wishing to operate outside of traditional regulations and rules (imposed by the state, teachers unions, etc.) can now apply for status as innovation schools or zones in an effort to spur rapid change and achievement improvements that might not otherwise be possible in traditional and more regulated settings.

Finally, individual school performance as well as classroom expenditures (an attempt to measure return on investment) will be published by the state and schools will be ranked and recognized accordingly. This transparency—especially in spending as it relates to achievement—is a leap forward in terms of changing the dialogue in public education. Instead of measuring inputs and dollars in a vacuum (i.e., regardless of achievement), Ohio will begin asking, “What bang are we getting for our buck?”

Conclusion
Considering the fiscal climate in which this budget was written, it is an impressive piece of work that sets the conditions for moving Ohio’s education system forward. There is still plenty that could be derailed through poor implementation by the Ohio Department of Education, the State Board, and individual school districts. But there is no doubt that the budget language moves Ohio towards a performance-based system of education that rewards success, highlights problems, and punishes abject failure. Let the hard work begin.

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State Teachers Retirement System STRS Ohio Update June 30, 2011

CONTRIBUTION CHANGE REMAINS OUT OF FINAL BUDGET BILL; ORSC GOING AHEAD WITH STUDY
The legislative conference committee dealing with the state budget did not include a shift in employer/employee contributions for the five statewide pension systems in its final report issued on Monday, June 27. The Ohio Senate then passed the budget bill on June 28, followed by passage in the Ohio House of Representatives on June 29. The bill then went to the governor for his signature.

During the budget discussions, STRS Ohio voiced its concern about the change, advocating that any discussion of contributions should be held within the context of the pension reform legislation proposed by the five Ohio statewide public pension systems. STRS Ohio is grateful for the many STRS Ohio members and constituency groups who also shared this message with members of the Legislature.

Discussions about future pension reform now shift to the Ohio Retirement Study Council (ORSC), the legislative oversight committee for the five pension systems. It is going forward with its plans to issue a request for proposal (RFP) for an independent actuary and policy advisor. According to the RFP, this consultant will be asked to review the systems’ proposed pension reform plans, as well as alternative pension plan design changes, retiree health care coverage, pooled purchasing, and individual account options to augment retirees’ pensions and health care coverage. It is expected that the process of hiring a consultant, plus the completion of the requested work, will take the project well into the fall.

Committee hearings on House Bill 69 and Senate Bill 3, which were introduced earlier this year to carry pension legislation, will not be resumed until after the ORSC study is done. However, STRS Ohio members are encouraged to keep sharing their opinions with their legislators – particularly on the topic of preserving defined benefit pensions for future retirees versus moving public educators into defined contribution plans.

As STRS Ohio has noted in previous communications, the defined benefit pensions Ohio’s public educators earn:

- Provide retired teachers a reasonable and reliable pension they won’t outlive.

- Save taxpayers billions of additional dollars in potential public assistance expenditures now spent to help individuals whose savings accounts, such as 401(k) plans, do not provide enough to keep them out of poverty in retirement.

- Provide a stable source of revenue, including tax revenue, for Ohio’s local economies.

- Are both efficient and economical, as a defined benefit pension can deliver the same retirement income at almost half the cost of a defined contribution savings account due to pooling of investment risk, continual diversification of assets and professional investment management.

- Help Ohio’s schools, colleges and universities recruit and retain quality educators.

With legislators spending more time in their home districts during the summer, STRS Ohio members have an opportunity to talk face-to-face with their representatives and senators about the importance of preserving pensions. Phone calls, letters and e-mails are also effective. Although there is a lag in the pension discussion at the Statehouse, it is still important to stress the importance of changes being approved in a timely manner that preserve pensions for all STRS Ohio members.

Links to additional information relating to the proposed pension legislation are below.

Testimony by STRS Ohio Executive Director Michael J. Nehf can be found at: https://www.strsoh.org/legislation/Testimony.html.

Contact Information for the Members of the ORSC can be found at: https://www.strsoh.org/legislation/ORSC_contacts.html.

Contact Information for the Members of the House Subcommittee can be found at: https://www.strsoh.org/legislation/House_contacts.html.

Contact Information for the Members of the Senate Government Oversight and Reform Committee can be found at: https://www.strsoh.org/legislation/Senate_contacts.html.

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…House and Senate budget writers were discussing (changes) for next Sunday’s unveiling of the two chambers’ compromises on the nearly $56 billion spending blueprint for the two years beginning July 1. They face a Thursday deadline for getting the voluminous budget bill signed by Gov. Kasich.

The House-passed version of the budget featured a plan to overhaul teachers’ evaluations and how they get paid, language that closely resembled provisions in a controversial collective bargaining bill ( Senate Bill 5) that limits the rights of about 350,000 unionized public workers around the state. Teachers’ salaries would be based on their performances and evaluations instead of seniority and level of training.

Ohio’s $56B budget nearly done
Legislators face Thursday deadline on 2-year plan. By Julie Carr Smyth The Associated Press. Published in The Enquirer 6/25/11 C7