June 2006

Number 06-17

One proposal being advanced throughout the country by anti-public education activists is the "65% Solution." Tim Mooney a Republican political consultant and Patrick Byrne the CEO of Overstock.com have founded a group called First Class Education (FCE). The goal of this organization is to pass laws in each of the 50 states to require school districts to spend at least 65% of their operating budgets on "classroom expenditures."

While this proposal to require school districts to spend at least 65% of their budget on direct classroom instruction may seem reasonable at first glance, what FCE is really trying to do is to force school districts to reallocate existing resources. FCE purports that mandating 65% of existing education spending be used for direct classroom expenditures will "increase money spent in classrooms without raising taxes" and will also "improve student outcomes." They claim that if all 50 states and the District of Columbia had spent 65% in the classroom during the 2002-03 school year, an additional $14 billion would have been available without any increase in taxes.

Both the AFT and the NEA are opposed to the 65% Solution. Mandating that districts reallocate current expenditures to achieve 65% is unfair because it omits from consideration many related expenditures that are critical components for the education of students. For example, the definition of classroom expenditures excludes costs for transportation, counselors, security, libraries, school lunches, nurses, and instructional aides. FCE uses the definition of instructional expenditures based on the National Center for Education Statistics (NCES). The NCES definition of instruction is divided into two categories:

Interestingly, according to the National Center for Education Statistics (NCES), New York and Maine are the only states that spent more than 65% on direct classroom expenditures in 2002-03. According to NCES, New York spent 68.7% and Maine spent 67.1% on direct classroom expenditures.

Currently, ballot initiative campaigns are underway to present the 65% Solution to the voters in Arizona, Colorado, Missouri, Ohio, Oregon, and Washington. P roponents of the 65% Solution claim that it has already been adopted in four states — Kansas, Louisiana, Texas, and Georgia. However, no state has actually implemented this requirement yet. Below is a summary of what has occurred in the four states that are often sighted as having adopted the 65% Solution:

Kansas — The Governor and Legislature in Kansas adopted the 65% Solution as a "public policy goal."

Louisiana — The Legislature in Louisiana adopted a resolution urging the State Education Board to adopt a 65% Solution mandate for all school districts. The State Education Board has yet to take any action on this resolution from the Legislature.

Texas — Republican Governor Rick Perry issued an Executive Order calling on the Commissioner of Education to develop a new financial accountability system and to include the 65% Solution within the newly designed system. The Commissioner of Education is still working on developing this new system. Just recently, the Texas Commissioner of Education announced that the costs associated with school libraries would be included as classroom expenditures, which was considered a major victory for education activists. Under the NCES definition of instructional expenses, libraries are counted as support services.

Georgia — Georgia is the only state that has actually adopted the 65% Solution in law. Republican Governor Sonny Perdue signed into law the 65% Solution. According to the Georgia law, beginning with the 2008-09 school year, each local school system shall spend a minimum of 65% of its total operating expenditures on direct classroom expenditures. School districts may request a waiver from the 65% Solution. The waiver must include evidence that the system is exceeding the state averages in academic categories.

Given the broad public support that this simplistic proposal receives in opinion polling — over 95% of respondents report that they would rather see education dollars be spent in the classroom than elsewhere, perhaps one approach to neutralize this effort is to reframe the issue. The proponents of the 65% Solution support reaching 65%% through a reallocation of existing school resources which pits certain school service employees against teachers because districts would be forced to cut expenditures for school related professionals, counselors, nurses, librarians, social workers, administrators, food service workers, custodians, and other nonteaching positions. By changing the terminology from "reallocate existing resources to achieve the 65% Solution" to " increase education funding to achieve the 65% Solution," or by expanding the definition of "classroom instruction" expenditures, the impact of this initiative would be neutralized.

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