This week’s “Daily Journal” guest columnist is Terry Stoops, Education Policy Analyst for the John Locke Foundation.

Gov. Mike Easley’s proposed budget for education starts from a number of faulty assumptions. Teacher pay, high school reform, and class-size reductions are among the spending items that grow in his budget plan despite a lack of evidence that they improve education in North Carolina.

Here are some of the facts behind the myths and some recommendations about how to use the money better.

Teacher Pay Increase
Governor’s Proposal: $323 million

In an effort to raise teachers’ salaries “above the national average,” Easley announced that teachers in North Carolina will receive pay raises over a period of three years. Nevertheless, a 2005 study by the John Locke Foundation found that the average teacher salary in North Carolina was $52,006.

That’s nearly $1,600 more than the national average when adjusted for cost of living, pension contributions, and years of experience. If the legislature approves Easley’s 8 percent teacher pay increase, the average adjusted teacher salary would climb to $56,960 – more than $5,000 above the adjusted national average.

Funds designated for teacher salary increases should be used to implement a merit pay system that rewards individual teachers for the value they add to their students’ academic performance.

Expansion of Learn and Earn/Early College Schools
State Board of Education Proposal: $7.6 million
Governor’s Proposal: $9.8 million

In 2003, the state unveiled million-dollar high school reform initiatives, like the Learn and Earn/Early College program, to raise graduation rates and increase test scores.

These programs have met neither goal. Graduation rates for these schools remain about 18 percent lower than the state average. As a group, Learn and Earn/Early College schools had much lower average end-of-course test scores than state averages, despite maintaining a student-teacher ratio of 13:1.

Moreover, teacher turnover was significantly higher in Learn and Earn schools (43 percent) than the state average (19 percent). Nevertheless, the governor plans to fund specialty high schools in all 100 North Carolina counties by 2008. This year, the governor proposes to increase the number of Learn and Earn schools by 19 (for a total of 34) and to provide grants to 20 additional high schools for planning.

The state should not expand the program until there is empirical evidence that Learn and Earn/Early College schools improve student performance.

Expansion of Low Wealth Supplemental Funding
State Board of Education Proposal: $0
Governor’s Proposal: $41.9 million

In response to the Leandro lawsuit, the state has significantly increased funding for low-wealth counties. Much of the new money pays for additional staff to lower class size. The Low Wealth School District Supplemental Funding increased from $6 million in 1992 to $133 million in 2005.

Out of 115 school districts, 80 currently receive low-wealth funding, and these districts spent more than 70 percent of the funds on salary and benefits.

There is no evidence that these additional funds are having a measurable effect on student performance. For example, the final report of the High Priority Schools Initiative, the state’s four-year class size reduction program targeting low-performing and low-income elementary schools, found that smaller class sizes did not improve student achievement.

The legislature should approve the governor’s request for funds to commission an independent evaluation of low wealth and disadvantaged student funding.

Education Lottery

The General Assembly estimates that $425 million will be generated by the lottery this year for school construction, class-size reduction, and pre-kindergarten programs like More At Four. As the law is currently written, the education lottery will do little to fund the most critical needs of North Carolina’s students.

Too little of the lottery revenue will address critical school facilities needs in high-growth school districts. One third of the nearly $162 million set aside for school construction will be given to school districts with property taxes that are above the state average – literally a high-tax bonus.

Many of these districts are not experiencing growth that would necessitate this additional lottery revenue. Charter schools are in the worst predicament of all, having to pay for facilities without access to lottery funds or other state and local funds for capital expenditures.

On the other hand, too much of the lottery revenue for education will be used to fund unproven class-size reduction efforts and pre-kindergarten programs. The estimated $200 million in lottery funds for pre-kindergarten and class-size reduction efforts will supplant, not supplement, state funding already in place for these purposes.

These funds would be better spent by charter schools and high-growth school districts for school construction and renovation.

Lifting the cap on charter schools would allow the state to leverage its operating dollars better without spending extra money on unproven or ineffective programs. Charter schools also would provide needed relief to fast-growing counties that face billion-dollar construction bills.

Experimentation is the role of the private sector and students, not of the government and education bureaucrats.