Protecting Public Education

Because of its dependence on local taxes, and because property taxes are often the biggest tax abated, no public service is as adversely impacted by economic development subsidies as public education. Worse, no public bodies have as little say in whether companies should be getting the subsidies in the first place as school boards.

There is an easy remedy, one that’s already in place in some communities, and that’s taking the public-school portion of local taxes off the table when it comes to subsidies. Short of that, we also recommend cities and counties at a minimum notify schools when their budget is about to be compromised. Better yet, states should give school boards veto power over their shares of abatements.

Starting in fiscal year 2017, the public could begin to track how much money school districts were losing to corporate tax breaks. This was made possible thanks to Governmental Accounting Standards Board Statement No. 77 on Tax Abatements. It’s a mouthful to say but not too difficult to find — if your community is losing money AND properly reporting it. Check your school district’s end-of-year spending report (Annual Comprehensive Financial Report) and search for “abatement.” Learn more at our GASB 77 project page.

All students, regardless of where they live or the incomes of their household, should have access to high-quality, fairly funded education.

Recent work on Public Education