News Story

Clock Ticking on School Adequacy Study

Bipartisan tax hike deal called for study

A public school-funding “adequacy” study that has been much anticipated by reformers and status quo education interests alike has failed to appear by the March 31 deadline in the state contract.

A week after the deadline for the $399,000 study, there is no study. The contract has a late-fee clause that allows for a delay, but the unusual origin of this project means there is also a deadline prescribed in state law, and that one says state officials shall — not may — ensure the deadline is met.

“Regretfully, there were delays transferring information to the vendor that necessitated additional time to complete a comprehensive report,” said Caleb Buhs, spokesman for the Department of Technology, Management and Budget. “Because of this delay, the vendor indicated that the report would not be complete by March 31 and the additional option time available in the contract was exercised, at no additional cost to the state. We expect the final report to be ready by mid-May.”

Hiring a private company to tell the state how much it should spend on public schools was the product of a deal made late on the night of December 19, 2014, during a postelection lame duck legislative session. Gov. Rick Snyder and Republican legislative leaders needed Democratic votes in the House and Senate to place a $2 billion tax hike on the ballot (two-thirds of which would have increased road funding). A new law authorizing the school adequacy study was part of the bargain.

A request for proposals was issued and a company called Augenblick, Palaich and Associates was selected. The Colorado-based company referred questions to the Michigan Department of Treasury. As reported earlier by Michigan Capitol Confidential, the company’s 12 most recent studies of state education systems all concluded that spending should be increased.

The law requires more than an indication of how much is adequate, but consideration of the amount required to give a "quality" education to each pupil. It also specifies an assessment of how well the data can be used to "recognize existing public school and pupil cost pressure differences.” There are many other detailed specifications in this law.

“The deadline to submit this report wasn’t just a suggestion, but was a very clear requirement in the RFP (state bid process) and state law,” said Gary Naeyaert, executive director of the Great Lakes Education Project. “We also don’t think DTMB has the authority to approve a two-month extension here. We urge the Legislature to send a message to noncompliant vendors and pull the funding for this study.”

Amber McCann, spokeswoman for Senate Majority Leader Arlan Meekhof, didn’t return an email seeking comment.

The Michigan Legislature passed the law that stated that the study had to be completed by March 31, 2016. The law states: 

The department of technology, management, and budget shall ensure that the study required under this section is completed within 1 year after the effective date of this section (March 31, 2016). The department of technology, management, and budget shall develop a request for proposals and award the contract required under this section in time for this deadline for completion of the study to be met and shall include this deadline in the request for proposals and in the contract.

The $399,000 contract had an option that was exercised that allows an extension that pushes the new deadline to May 13. It is unclear what the consequences, if any, are for a state department not meeting deadlines. Forebearance is not unusual.

The agency's contract states that if the report is late, the state is entitled to collect damages of $5,000 and an additional $500 for each day the report is not completed.

Buhs didn’t respond to an email asking whether the state would seek damages.