What would it cost to tie education spending with the Consumer Price Index?

By Steve Wilson
April 23, 2019

Tying annual increases of K-12 education spending to the price of consumer goods for urban consumers, depending on which measure is used, could become very expensive for taxpayers.

Increasing K-12 education spending commensurate with the 18 percent cumulative rate of inflation suggested by public education advocates would’ve added up to $1.042 billion in additional spending between 2007 and 2017. These figures include federal, state and local revenue.

Synchronizing increases in K-12 spending to the Consumer Price Index from the U.S. Bureau of Labor Statistics (21.9 percent cumulative rate of inflation) would’ve hit taxpayers with $1.228 billion in additional spending during that time.

The Consumer Price Index measures the average change, over time, in prices paid by urban consumers for various goods and services, including food, beverages, health care, insurance, housing, and energy. 

That includes electricity rates and gasoline prices.

Mississippi, according to data from the U.S. Census Bureau, has 51.2 percent of its total population living in rural areas.

The furor over inflation and whether K-12 spending needed to be more closely tied to it came out of a report issued by state Auditor Shad White’s office. 

The report by the auditor’s office showed that the growth in K-12 spending on administrative and other non-classroom costs from 2007 to 2017 outpaced the increase in the amount spent in the classroom. 

According to the report, administrative costs increased 17.67 percent during the decade, while instruction costs increased 10.56 percent.

The amount of money being spent overall (federal, state and local) on K-12 education in Mississippi increased 12.89 percent from 2007, when it was $4.9 billion, to 2017, when it was up to $5.5 billion.

This inflationary data might not be applicable to government spending on K-12 education, except in a few cases. 

According to BLS data, the annual rate of increase for food and beverage prices for urban customers averaged 2.3 percent.

Diesel is needed to fuel school buses and national retail prices, according to data from the U.S. Energy Information Administration, averaged $3.17 per gallon due to five years of prices of $3.80 and higher in the South. 

Diesel prices from 2013 to 2017 decreased from $3.92 to $2.65, a drop of 32.39 percent.

White’s report isn’t the first time that alarms have been sounded over increasing administrative costs. 

The Joint Committee for Performance Evaluation and Expenditure Review (PEER) released a report in 2015 that showed spending from 2005 to 2015 on instruction decreased by 3.2 percent while that spent on administration increased by 13 percent.

According to data from the state’s Legislative Budget Office, federal and state taxpayers have spent about $3.426 billion on average in the last four years for K-12 education, which averages about 16.3 percent of the state’s total budget when all revenues (general fund, special funds and federal funds) are considered.

These figures don’t include local property taxes and other revenue, such as 16th section land lease income.


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