Email, Joe Wisnoski, associate, Moak, Casey & Associates, July 20, 2017

From: Selby, Gardner (CMG-Austin)

Sent: Thursday, July 20, 2017 3:26 PM

To: Joe Wisnoski ; Tom Canby

Subject: Fresh inquiry for a fact-check

Tom, Joe:

I write seeking your fresh help and comments for a fact-check.

Lt. Gov. Patrick last week told reporters: “Of all the money we spend on education, less than 32 percent goes to teachers.”

I get to 31 percent by dividing the $18 billion shown on this TEA web page as devoted to teacher salaries in 2015-16 into the nearly $59 billion in ALL FUNDS revenue. On the other hand, the agency indicates $79 billion in total receipts for schools, which could drive down the described percentage for teacher salaries to 23 percent. Both of these equations also disregard a good number of school workers.

At this moment, then, I am unsure how to reach a solid calculation.

g.

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W. Gardner Selby

Reporter / News

Austin American-Statesman

PolitiFact Texas

3:52 p.m.

Tom can likely give a more technically correct answer on the distinction between revenue and receipts, but the primary difference is going to be bond proceeds, including the proceeds from refunding bonds.  I’m not sure those sources of funds should be intermixed with revenue for the purpose of this kind of calculation.

On the other hand, I would tend to put bond funds, including debt service, into a somewhat separate category, since those funds legally cannot be used on teacher salaries.

If you restrict the view to just operating funds (leaves out bond proceeds, capital outlay, debt service expenditures, etc.), you would compare the roughly $18 billion to roughly $49.5 billion in all funds operating expenditures, and the percentage would be 36.4%.  

Additionally, just looking at salary misses benefit costs, and school districts are required to report the state’s share of teacher retirement expenses as their own even though they do not receive those funds, so benefit costs are in the total (denominator) but not in the numerator, leading to a lower percentage.

There are lots of ways to include or exclude things in the world of school district finances, and what is most appropriate somewhat depends on the person making the point and the specific point being made.  Do school districts actually utilize $79 billion in some fashion in a year?  If you consider borrowing $8 billion (just an example, not a real number) to refinance other debts to be “utilizing” money, then yes they do, although you can’t pay teachers or any other staff with that type of money.  But that is something like counting both your salary/paycheck and the money you borrowed to buy a new car or a new house all as “receipts”.  In a technical sense, that is correct, but it doesn’t mean you have more money to buy groceries just because you bought a house.

As just another statistic along the way, if you look at the reported $18 billion of teacher salaries (excluding benefits) as a percentage of all salaries, it was 59.5%.

___________________________________

Joe Wisnoski, Associate

Moak, Casey & Associates