Chapter 70 inequities and changes since 2000

Chapter 70 is a Critical Piece of Municipal Finances

School budgets represent the largest single expense for a city and town and a key piece of this funding is Chapter 70 which I summarized in another post.

The formula is intended to develop equity between cities and towns, but upon looking at the trends, this equity does not appear to be happening in my hometown of Amesbury.

Since Amesbury has been on the losing end of Chapter 70 reimbursements, considerable strain has been put on our local finances and our local tax rate. While we continue to serve an increasingly diverse school population, the money we receive from Massachusetts has gone down. At the same time many cities and towns have seen dramatic increases in state funding.

In my professional life I help companies organize disparate data sources to build a coherent strategy. One of the first steps involves looking at trends to see if everything simply "makes sense." When I look at the range of Chapter 70 changes since 2000, it doesn't make sense.

The data for what Chapter 70 money cities and towns have received is available on the Massachusetts Department of Revenue website. The data is not  well organized for looking at annual trend data between municipalities. Trend data is available for individual towns or comparative data for an individual year. I chose to aggregate the comparative data for individual years and begin some analysis.

Six Cities and Towns out of 192 received less Chapter 70 dollars in 2013 than 2000

It is difficult to believe that only 6 cities and towns received less Chapter 70 aid for education in 2013 than in 2000. In looking at the list, these would not be the communities one would select if common sense were being applied..

When I look at problems like this for clients, I identify a few possible causes for outliers that don't make sense when compared to goals.

1. The data is wrong
1. someone entered wrong information in one of the input fields
2. The formula/logic is wrong
1. the assumptions used to build the formula are not aligned with the goal

The top 10 Cities and Towns with Largest % increase since 2000

What does this look like in total dollar changes fore each list

Aggregate Change Since Fiscal Year 2000

This table shows the total Chapter 70 changes for communities receiving between 1 million and 16 million in Chapter 70 Aid.  As you can see the total available dollars for this group increased by 15% and the average increase for an individual town was 28%.

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We want what they’re getting

Here is a recap of what I outlined in previous posts:
- the basics and importance of Chapter 70
- the overall trend of Chapter 70 funding and the few towns that have gone backwards since fiscal year2000

In this post I want to look at a group of towns that received roughly the same level of dollars in 2000 and how that amount has changed by town since. 

I chose a group of towns around Amesbury’s fiscal year 2000 dollar range. I did not include regional or vocational schools in this comparison. All the data is directly from the state's spreadsheets on the department of revenue site.  There were 19 cities and towns that received between 7.3 million and 10.6 million in Chapter 70 funds in the year 2000 and of those 19 cities and towns only one, Amesbury, now receives less money.

The largest gainer in funds from this group over the last 13 years is Newton.

 

This disparity becomes more shocking when you look at the cumulative difference in millions of dollars that means to a city or town.

Newton which initially received a million dollars less than Amesbury in 2000, made gains over the subsequent 13 years collecting almost 45 million dollars more than Amesbury.






While Newton North built a 200 million dollar state-of-the-art high school
http://www.boston.com/yourtown/newton/gallery/083110_newton_north_new_high_school/
Amesbury now has the highest property tax rate in Massachusetts.


I was able to locate some of the inputs from 2007 through 2013 that are used in the ‘ability to pay’ calculation.

While Newton’s EQV  is 10x that of Amesbury’s and its Income/Population is more than 2x that of Amesbury, it received an increase in Chapter 70 funds of 47% since 2007.   Amesbury now receives 1% less than it did in 2007.



The graph below shows the annual changes for Amesbury over this time period.  As you can see there is a huge dip between 2003 and 2004 that has never recovered.