On the heels of a US Census report showing Arizona seriously lacking in K-12 funding, Governor Doug Ducey announced plans to give the system a much–needed shot in the arm. The Greater Phoenix Chamber of Commerce, along with other business and education leaders, attended the governor’s press conference announcing a proposal to pump $1.8 billion into K-12 schools over five years beginning in FY 2017 pending legislative and voter approval, all without raising taxes.
The federal government gave Arizona lands as an endowment at the time of statehood in 1912. Arizona sells those lands and the revenues are deposited into the Permanent Land Endowment Trust Fund. Those monies are held in trust and are invested by the state treasurer for the benefit of various beneficiaries as outlined in the Arizona Constitution. K-12 schools receive the largest share of the funds at 93 percent.
By increasing the distribution percentage from the Fund from the current 2.5 percent to 10 percent over five years, the proposal takes advantage of the outstanding growth the Fund has experienced over the last several years. Following the initial five year increase, the proposal drops the distribution from 10 percent down to five percent for the next five years before returning to the current distribution rate after ten years. Even after the increased distribution amounts, the Governor anticipates the Fund having a higher balance than today, thereby protecting the Fund for future years of beneficiary payments.
While this is certainly not a cure all for the problems facing our K-12 system, it would provide much–needed financial relief for our schools and give the state time to come up with a long–term funding and school finance reform plan. The GPCC is excited to work with the Governor, the Legislature and other stakeholders in the coming months to make sure this plan is successful. A strong public education system helps build our economy as a sustainable economy needs a talented workforce pipeline.
For full details on the proposal, please click here.