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Education Spending Transparency Doesn’t Require Massive Tax Hike

Colorado potentially faces a wasted opportunity in undertaking a push for greater school financial transparency. If state leaders talk up transparency as a new project and in vague terms, then they may miss the benefit of lessons already learned and fail to create a genuinely useful online tool.

Part of Amendment 66’s billion-dollar promise was the creation of a website to track nearly every tax dollar collected and spent in K-12 public education. However, an overwhelming majority of voters sent the initiative to the ash heap.

During last week’s State of the State address, Gov. John Hickenlooper divined a message sent by 64 percent of voters. He said they need assurance that the $10,000 spent per student is “prudently managed” before agreeing to add more funds.

“We are going to request that the General Assembly fund a plan to make the budget of every public school transparent,” the governor declared. “Let’s put the numbers on the Internet and make the web a window.”

Giving Coloradans open government should be more than an applause line. Whatever reassurance skeptical voters may need, it’s not because officials have withheld financial information from online disclosure. The question is whether they have done enough.

The push started five years ago. In 2009, concerned citizens packed a legislative committee hearing to support a school spending transparency bill. The legislation surprisingly cleared the Senate before many lawmakers and lobbyists knew what hit. House Education Committee chairman Mike Merrifield later employed a little-used tactic to kill the proposal.

The transparency train rolled forward. Rather than get run over, groups representing education agencies and employees successfully advanced their own legislation. Colorado’s 2010 Public School Financial Transparency Act mandates every school district and charter school post prescribed financial documents on their websites.

Rather than wait, leaders in Colorado’s then-largest school district had taken action before the law passed. A Jefferson County resident paid to obtain district financial records and posted them online. Faced with criticisms of trying to hide certain expenditures, Jeffco R-1 created a searchable internet database of line-item transactions allowing users to follow the money.

Other major districts, including Douglas County and Adams 12, also were among the first to create user-friendly searchable spending databases. They exceeded the legal prescription. Yet many local education agencies struggled to comply with the basics. Only 26 of 178 districts fully followed transparency requirements by the law’s 2011 deadline.

Today, aware and interested citizens generally can go online and access financial reports. Some local K-12 agencies make it difficult to find and compare meaningful information, though.

Even with current transparency requirements, visiting multiple district websites with different data formats can be difficult and time-consuming. Last year’s Senate Bill 213, tied to the Amendment 66 tax initiative, offered a one-stop state system where users could compare spending details at each school site. During the campaign Hickenlooper suggested the online system could cost $18 to $20 million, though the bill set aside less than $5 million for it.

Such a change could be very helpful to conscientious taxpayers. The Cato Institute recently gave our state department of education website a D-plus for failing to provide usable and timely financial data. Meanwhile, our New Mexico neighbor’s A grade placed them first in the nation.

One legislator is prepared to introduce a bill that would allow state website users to make easy visual comparisons of different school district financial activities. The information would be linked to the more detailed local transparency data for those people who want to dig deeper.

It remains to be seen whether the bill gains traction or whether a stronger proposal might emerge. Lawmakers do have room to enhance the clarity and accessibility of financial information that schools report.

But the governor still may not find it enough to win the next big state tax hike.

Ben DeGrow (ben@i2i.org) is senior education policy analyst for the Independence Institute, a Denver-based free market think tank. This article originally appeared in the Greeley Tribune on January 16, 2014.