Arizona teacher pay ranks higher than reported

Arizona Capitol Times
Monday, July 21, 2014
Sean McCarthy

The Arizona Tax Research Association would like to correct an important error in the Arizona Capitol Times (July 11). The National Education Association (NEA), the largest teachers union in the nation, ranks Arizona 29th for school year 2012-13 in average salaries for K-12 “public school teachers.” The Capitol Times article incorrectly reported Arizona at 42nd.

Moreover, when controlling for per-capita personal income (PCI), Arizona’s ranking jumps to 14th in the nation. Calculating these average salaries as a percentage of PCI is a common method that accounts for differences in the underlying wealth between states. This analysis also helps account for the differences in cost of living between states. It certainly would be inappropriate to directly compare a New York teacher’s salary against one in Arizona.

A mistake often made in Arizona is linking our historic low Maintenance and Operations (M&O) per-pupil ranking with low teacher pay. Actually, our low expenditures per-pupil ranking is largely a function of dramatic student growth in Arizona over the last 25 years. In fact, between 1992 and 2010, Arizona’s total M&O spending for K-12 education increased 189 percent, the third highest percentage increase nationwide. Certainly, arguments can be made that historically teachers have been paid less than other professions. However, in comparative terms, Arizona teacher salaries have fared well with other states.

Perhaps more important than how Arizona ranks nationally, the article touched on another major policy challenge that affects teacher pay: inequitable spending. According to the Department of Education, Humboldt Unified’s per-pupil expenditures were $5,425 in FY2014. It’s no surprise a Humboldt teacher might flee to a district like Phoenix Union, where per-pupil expenditures last year were $8,333. A starting salary in Phoenix Union is 27 percent higher than Humboldt Unified. The base salary for a teacher with 10 years’ experience and a master’s degree in Phoenix Union is $55,348 versus $40,610 in Humboldt, a 36 percent difference. Arizona K-12 schools are financed via an equalized formula based on student counts. It begs the question how one district could spend nearly $3,000 more per student. The devil is in the details. Phoenix Union levies an additional property tax each year for “desegregation” that nets the district $56 million annually despite the fact their court order to desegregate was lifted in 2005. Certainly that $56 million, which essentially can be used by the district officials however they choose, goes to increased salaries. In addition, Phoenix Union voters authorized an M&O override, which adds $13.3 million to their annual budget. Finally, the hold-harmless transportation funding formula means Phoenix Union property taxpayers pay an additional $2.1 million on top of the equalized amount; essentially, paying for busses and drivers as if the district had not contracted in size. Humboldt does not have a desegregation levy, has failed to pass an override, and the transportation formula delta adds just $400,000. It can’t compete with a district like Phoenix Union, which has roughly $72 million in funds outside the revenue control limit. Un-equalized money in Arizona K-12’s topped $375 million in FY 2014.

Arizona now has a K-12 system that strongly encourages parental choice. Districts compete against other districts and charters for students who are free to attend the school of their choice. The playing field for that competition is clearly uneven. Whether it is to avoid perpetual litigation surrounding the meaning of “general and uniform” or just fundamental fairness, policymakers should address these inequalities in Arizona school finance.

— Sean McCarthy is a senior research analyst at the Arizona Tax Research Association.
— Editor’s note: The Arizona Capitol Times story incorrectly attributed the National Education Association as the source in reporting that Arizona ranked 41st and 42nd nationally in average starting pay for teachers and average overall teacher salary. That information came from a Grand Canyon University study on teacher shortages. The NEA 2012-13 data shows Arizona is ranked 43rd nationally for average starting teacher salary and 29th for average teacher salary.