Rhode Island Policy Reporter

RIPR is a (paper) newsletter that looks at local, state and federal policy issues that affect life here in the Ocean State. Each issue focuses on particular policy areas of interest. Future issues will examine controversial aspects of environmental policy, health care, state tax reform, and education spending. The intention is to look at action rather than talk.

RIPR also issues a weekly column about public policy, carried by ten of Rhode Island's finer newspapers. See here for an archive of recent columns.

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Available Back Issues:

  • Feb 08 (30) - IRS migration data, and what it says about RI, a close look at "entitlements", historic credit taxonomy, an investment banking sub-primer.
  • Dec 07 (29) - A look at the state's underinsured, economic geography with IRS data.
  • Oct 07 (28) - Choosing the most expensive ways to fight crime, bait and switch tax cuts, review of Against Prediction, about the perils of using statistics to fight crime.
  • Aug 07 (27) - Sub-prime mortgages fall heaviest on some neighborhoods, biotech patents in decline, no photo IDs for voting, review of Al Gore's Against Reason
  • Jun 07 (26) - Education funding, budget secrecy, book review of Boomsday and the Social Security Trustees' Report
  • May 07 (25) - Municipal finance: could citizen mobility cause high property taxes? What some Depression-era economists had to say on investment, and why it's relevant today, again.
  • Mar 07 (24) - The state budget disaster and how we got here. Structural deficit, health care, borrowing, unfunded liabilities, the works.
  • Jan 07 (23) - The impact of real estate speculation on housing prices, reshaping the electoral college. Book review of Blocking the Courthouse Door on tort "reform."
  • Dec 06 (22) - State deficit: What's so responsible about this? DOT bonding madness, Quonset, again, Massachusetts budget comparison.
  • Oct 06 (21) - Book review: Out of Iraq by Geo. McGovern and William Polk, New rules about supervisors undercut unions, New Hampshire comparisons, and November referenda guide.
  • Aug 06 (20) - Measuring teacher quality, anti-planning referenda and the conspiracy to promote them, affordable housing in the suburbs, union elections v. card checks.
  • Jun 06 (19) - Education report, Do tax cut really shrink government?, Casinos and constitutions, State historic tax credit: who uses it.
  • May 06 (18) - Distribution analysis of property taxes by town, critique of RIEDC statistics, how to reform health care, and how not to.
  • Mar 06 (17) - Critique of commonly used statistics: RI/MA rich people disparity, median income, etc. Our economic dependence on high health care spending. Review of Crashing the Gate
  • Feb 06 (16) - Unnecessary accounting changes mean disaster ahead for state and towns, reforming property tax assessment, random state budget notes.
  • Jan 06 (15) - Educational equity, estimating the amount of real estate speculation in Rhode Island, interview with Thom Deller, Providence's chief planner.
  • Nov 05 (14) - The distribution of affordable houses and people who need them, a look at RI's affordable housing laws.
  • Sep 05 (13) - A solution to pension strife, review of J.K. Galbraith biography and why we should care.
  • Jul 05 (12) - Kelo v. New London: Eminent Domain, and what's between the lines in New London.
  • Jun 05 (11) - Teacher salaries, Veterinarian salaries and the minimum wage. Book review: Confessions of an Economic Hit Man
  • Apr 05 (10) - Choosing a crisis: Tax fairness and school funding, suggestions for reform. Book review: business location and tax incentives.
  • Feb 05 (9) - State and teacher pension costs kept artificially high. Miscellaneous tax suggestions for balancing the state budget.
  • Dec 04 (8) - Welfare applications and the iconography of welfare department logos. The reality of the Social Security trust fund.
  • Oct 04 (7) - RIPTA and DOT, who's really in crisis?
  • Aug 04 (6) - MTBE and well pollution, Mathematical problems with property taxes
  • May 04 (5) - A look at food-safety issues: mad cows, genetic engineering, disappearing farmland.
  • Mar 04 (4) - FY05 RI State Budget Critique.
  • Feb 04 (3) - A close look at the Blue Cross of RI annual statement.
  • Oct 03 (2) - Taxing matters, a historical overview of tax burdens in Rhode Island
  • Oct 03 Appendix - Methodology notes and sources for October issue
  • Apr 03 (1) - FY04 RI State Budget critique
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Creative Commons License Tom Sgouros

Fri, 07 Sep 2007

Paying for war with your school budget

[Appeared this past week in the Woonsocket Call, Pawtucket Times, and several other papers in the RIMG group.]

Over the last several years, the cost of educating our children has been the major driver of the rise in property taxes in Rhode Island. The biggest part of the rise -- by far -- has been the cost of special education. According to state department of education numbers, general education costs rose an average of 48% between 1998 and 2006, while special ed costs went up 83%. As of the 2005-2006 school year (the latest year published on the Education Department web site), we spend $444 million to educate these children out of nearly $2 billion for all the state's' public schools.


In 1975, Congress passed the Education for All Handicapped Children Act, now known as the Individuals with Disabilities Education Act (IDEA). This was the landmark legislation that established that the policy of our public schools would be to teach children with special needs in the same classrooms as everyone else, wherever possible. Where it isn't possible, the policy is to teach them in the same buildings as everyone else, and where that isn't possible, it's the school district's problem to pay for that child's education somewhere else.

It's a noble goal, but the problem is paying for it. In the past, children with serious education problems were shipped off to institutions like the state-run Ladd School. The current policy is a great step forward, but one can't help but notice that when the Ladd School closed, the savings in the state budget was not redirected to local school districts.

The state is an offender in this regard, but it is only a penny-ante player compared to the federal government. When IDEA was created, it established the laws that now rule special education. It was quite clear that the laws would create big financial burdens on states and local school districts, and the only way that it got through Congress was by including a promise to fund 40% of the costs of the new special ed rules and programs. All fine and good, of course, until you realize that now, 32 years after the law was passed, the federal government only funds 17% of the costs of this law.

Gerald Ford signed the bill into law, and the first year, the federal government paid 5% of the costs. The level climbed to about 12% by the time Jimmy Carter left office. Under Reagan, it slipped back to 8%, where it stayed, more or less, until 1993. During the Clinton administration, the level advanced to 14%. Progress continued after George Bush rode into town, until we started the Iraq war, when it stalled at 18%, and has backslid since.

This all seems a little abstract, so let's talk dollars. If we now fund 17% of special ed costs, and the goal is 40%, then what is that amount really? It's $13 billion, which seems like a lot of money, but is equivalent to about 41 days of what we are currently spending in Iraq. Rhode Island's share would be about $46 million, or about three and a half hours or Iraq spending. This week, Bush intends to ask Congress for another $50 billion to fund the war. That's a supplemental request, to go on top of the $147 billion he already requested, but hasn't been approved yet. To date, we've spent over $447 billion. (Check out the ticker to the right for more.)

So there you have it. Next time you're moaning about your property tax bill, remember that the fastest-growing part of the expenses it pays for are expenses that the Federal government was supposed to pay for, but doesn't, because of the war and the Bush tax cuts. (And we haven't even mentioned the costs of No Child Left Behind.) The added expense would be a drop in the federal budget bucket, but it's a major burden for your town.

But it's all tax money, you say. Who cares if it comes from federal taxes, state taxes, or property taxes? You do, and the reason is who pays those taxes. Income taxes are higher on wealthy people than on poor ones, and property taxes are exactly the reverse, with poor and middle-class people paying a much higher percentage of their incomes on property taxes than the rich. According to the Tax Policy Center in DC, the Bush tax cuts on the wealthiest half percent of our citizens were worth over $100,000 in 2007. When he refused to increase the funding for IDEA, he made your property taxes higher, because federal law still requires those special ed programs. That's the way it works these days, at the federal, state and local levels: the interests of the poor and the middle are routinely sacrificed for the interests of the wealthy. This sounds like rabble-rousing, but it's right there in the numbers if anyone cares to argue about it.

In 21st Century America, the military is not drawn from a cross-section of our world. Lots of people don't even know anyone who's been in combat. But the war still affects all of us, and one place you can see it is in your property tax bill.

23:53 - 07 Sep 2007 [/y7/cols] link

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