Moodys praises RI school funding hike, warns on Woonsocket
June 27th, 2012 at 11:41 am by Ted Nesi under Nesi's Notes, On the Main Site
The 2012-13 state budget Governor Chafee signed into law last week will help Rhode Island municipalities and school districts by providing $34 million in new education funding, Moody’s Investors Service says.
The nearly 4% hike in state aid for K-12 schools is the third annual increase in a row and “a credit positive for both school districts and for cities and towns,” Moody’s analysts wrote in a research note Tuesday. “State funding for education now stands at over $900 million, well above the pre-recession peak,” they said.
However, Moody’s said the impact isn’t uniform across the state because of the new school funding formula. Barrington will get the biggest increase in education aid in 2012-13 at 42%, while the Chariho school district will suffer the biggest drop, losing 14%. Non-education aid will be flat after plunging since 2007.
Moody’s also noted lawmakers’ $2.6 million appropriation to offset some of the deep cuts in Central Falls’ pension benefits will help that city emerge from bankruptcy, but expressed concern about the failure of a proposed supplemental tax sought by cash-strapped Woonsocket.
The failure to enact any laws to stabilize the 36 locally run pension plans also drew concern. “Members of the legislature have publicly stated that they intend to take up local pension reform, but the delay into the next legislative year highlights the significant political hurdles they’ll have to surmount,” Moody’s wrote.
(chart: Moody’s Investors Service)
Tags: barrington, central falls, chariho, education, general assembly, local aid, moody's, non-MERS, pensions, woonsocket
Nesi's Notes covers politics and the economy in and around Rhode Island for WPRI.com. (Twitter: 
How come the chart guide give 4 possible categories but the chart bars only show 3 spending categories?
I assume “other” is such a small amount we can’t see it on the chart. Ask Bob! I bet he knows.
Hardly! Double check it with the Uniform Chart of accounts. Remember, we pay for things other states don;t pay for, like out of district transportation and parochial school text books, plus we give back door vouchers in the form of tax expenditure spending to corporations who donate to private schools. “Other” adds up pretty quick.
Or maybe Moody’s decided those were details not worthy to get in the weeds on…..you know, them being facts an all. Perhaps better to create a chart with a phantom category and hope no one notices?
A 1 cent increase from last years 1 cent distribution would be a whopping 100% increase.
Barrington’s 42% increase follows that same logic. Barrington still sits at the bottom of the barrel in dollars per student in this rigged formula.
[...] the way, what does it mean for Rhode Island that its political journalists report more on what Moody’s thinks of the state’s school funding formula than it does local cities and towns? I think it means we’ve become a little too focused on [...]
Let’s start with this. How is Rhode Island better for more state taxpayer funding of public elementary/secondary education? Does Moody’s believe that spending more from state revenues has something to do with relieving local taxes? Do they believe it has something to with improving actual cognitive results? What more spending, state and local does is drive the results of teacher union collective bargaining. As long as that is based on a state law which guarantees whatever is agreed upon, must be honored and funded, additional spending from state taxes merely subsidizes those contracts. What is responsible about that? Better yet, what is responsible about a Legislature and a Governor behaving as mere extensions of teacher unions? Why doesn’t Moody’s entertain the idea that real structural changes can’t happen unless and until the Teacher Collective Bargaining law is changed dramatically? Until then, this reader isn’t buying what the “powers to be” shovel.
Good response, couldn’t agree more. This is just more of the same for Rhode Island. Raise taxes then spend more money, this has got to stop.