North Park Schools

With the recent news that the Grand Rapids Public Schools are preemptively cutting early childhood education after the Michigan senate voted to cut funding, We are encouraging our parents to contact their local, state and national political officials to make their concerns know and their voices heard.

As part of you letter or email, ask Legislators their commitment and/or position on the following when you discuss school funding issues:

I – OPPOSE any K-12 budget that increases the funding gap between high funded (20J districts) and low funded districts

This will happen if we cut low funded district categoricals and give all districts the same foundation allowance cut.

II – OPPOSE any K-12 Budget that uses School Aid Fund (SAF) dollars for items historically funded with General Fund dollars. Our classrooms lose about $200 million annually to this raiding of SAF dollars.

This is the Governor’s & Legislators’ attempt to supplement other department budgets with SAF dollars. (Revenues voted by Michigan citizens for education in “Prop. A” in 1994) Current examples:

1. Durant Debt Service $42 million per year
2. School Bond Redemption $40 million per year
3. Cash flow borrowing $45 million per year
4. Renaissance Zone Reimbursement $40 million per year
5. PILT (Payment in Lieu of Taxes) $3.5 million per year

III – SUPPORT closing Special-Interest tax loopholes that are taking financial resources away for our classrooms.

Current examples: (It should be mentioned that there are many, many more and the Representatives and Senators should be familiar with them)

1. Eliminate the use of tax exemptions for international calls; currently a long distance call to Sault Ste. Marie, Michigan is taxed and a call to Sault Ste. Marie, Ontario is not. This Special Interest gift takes away $15 million annually, $5 million from Michigan classrooms.
2. Reduce (like in other states) exemptions on interstate truck and trailer purchases. Currently a Michigan trucking business doing as little as 15% of its business in another state gets a 100% tax deduction on truck and truck part purchases. This practice provides unfair competition to the majority of Michigan truckers who do not get this tax break. This strong lobby influenced tax gift costs Michigan citizens and school children $21 million annually.
3. Eliminate oil and gas expense double deduction! When oil was trading under $20.00 per barrel, this “temporary” incentive was given to oil companies. This Special Interest perk (now at a time when oil companies are recording record profits) removes over $4 million annually. From the Michigan budget, approximately 25% is SAF money.

*Currently Michigan laws have more tax exemptions than nonexemptions — $38 billion (yes, billion) that could be taxed under our current law, but are not. Too many favored status exemptions.

IV – SUPPORT administrative and legislative program changes that will provide additional resources (revenue) to our classrooms.

Examples:

1. Like other states, Michigan should send letters reminding businesses that Use-Tax is due on out of state purchases. (Most businesses do apply, giving those who don’t an unfair advantage). Senate and House fiscal agencies project that this practice will increase state revenue by $2.5 million, most going to K-12 funding.
2. It is estimated that an increase in lottery ticket terminals and lottery advertising would put an additional $15 million into the School Aid budget each year.
3. Increase tax filing requirement enforcement (like neighboring states) and it is projected that Michigan’s annual revenue would increase by $11 million, 33% would be school funding dollars.

V – THANK legislators for the 2X formula (they will bring this topic up) but, remind them that our future without revenue changes looks like a 2 x 0 = 0.

VI – Representatives and Senators will tell you they want to cut the fat and waste before increasing revenue, remind them that Michigan has been in a revenue cutting process for the past eight years and all the fat and waste that can be cut has been cut.

Examples:

1. We in West Michigan believe that giving the 50 wealthiest school districts and additional $52 million annually is not only 20J fat and waste, but and insult to all West Michigan school children.
2. Remind them that Michigan’s annual revenue is lower now than it was 12 years ago and Michigan has fewer state employees now than we had in 1973.
3. Remind them of Dick Headley’s Conservative Constitutional revenue limiting amendment that was passed in the mid 1970s (Michigan cannot collect more than 9.49% of household income in state taxes and state fees).
4. Remind them Michigan hit that 9.49% limit in 2000 and 2001 and now we are almost $8 billion annually below that limit.

VII – SUPPORT a tax structure change that will provide consistent and equitable revenue for the future demands of our classrooms.

Examples:

1. Possible expansion of our sales tax to include a tax on luxury service purchases (like the rest of the states have done).

VIII – OPPOSE any new legislation (mandates) that will require additional resources during these times of funding cuts.