A legislative panel on Wednesday rebuffed the state House and Senate education committees' proposal to hire a Colorado consulting firm to study the state's process for funding public education.
Instead, the Policy Making Subcommittee of the Arkansas Legislative Council voted to require that the education committees either hire both of the companies that submitted bids for the study or none at all.
The subcommittee's recommendation will go before the full Legislative Council on Friday.
Wednesday's action was the latest complication in a controversial process that has split lawmakers for several years. In addition to disagreements about which company should study Arkansas school finance, legislators have disagreed about the scope of such a study and whether such a study is necessary at all.
Under the motion approved Wednesday, the education committees would have to enter two contracts -- one for $499,236 with St. Louis-based Shuls and Associates and another for $659,580 with Denver-based Augenblick, Palaich and Associates.
If lawmakers hire both companies, the total cost of the contracts will exceed $1.1 million.
Those in favor of the motion said that more information from separate groups would benefit the committees as they made recommendations for education funding changes. There was also concern from some members that Augenblick, Palaich and Associates would recommend large funding increases.
Looming over the process is the prospect of another lawsuit -- like the 2003 case that prompted an overhaul of how the state funded public schools -- if the recommendations of a consultant aren't implemented.
"We'd be providing a piece of evidence in a lawsuit that we didn't produce adequacy," state Sen. Bob Ballinger, R-Berryville, said. "The experience [Augenblick, Palaich and Associates] have comes back and says, 'You're not spending enough on education.'
"If we have two groups that come back and say we're not spending enough on education, then we'll be stuck, but at least at that point, we'll have a couple of ideas."
FUNDING STUDY
There has been growing, bipartisan appetite in the Legislature in recent years to hire an outside group to review the education committees' process for making public school funding recommendations every two years. The process hasn't received an in-depth, outside review since two college professors were hired to help develop a new funding formula in 2003 after the Arkansas Supreme Court's Lake View School District No. 25 v. Huckabee landmark decision that deemed the state's school funding model unconstitutional.
Every two years, the committees review that formula, typically making small tweaks, but it remains largely the same as it was 16 years ago.
Sen. Joyce Elliott, D-Little Rock, said hiring two groups was unnecessary.
"I don't know that it's fruitful for us to have these separate companies doing the work of adequacy," she said. "That seems to be just a recipe for spending more money and prolonging what we're doing."
Sen. Blake Johnson, R-Corning, noted that school funding comprises a huge chunk of state spending. Indeed, public education accounts for the largest single category of state spending in Arkansas. It comprises about 41% of the general revenue budget, making up about $2.25 billion of this year's $5.75 billion budget.
There is already a proposal to pay $600,000 to one company, Johnson said.
"I don't care that you spend another $400,000," he said. "The more info we can get as a body, the better off we are."
SURPRISED REACTION
The House Education Committee chairman, Rep. Bruce Cozart, R-Hot Springs, said he was surprised by the Policy Making Subcommittee's action Wednesday. He said he expects the education committees will support hiring both, but he's not totally sure how it will play out.
"I'll be blatantly honest; the people that didn't want [Augenblick, Palaich and Associates] I think were trying to figure out how to do something different," he said. "I don't have a problem doing it the way they want to do it. I just don't know about spending that amount of money."
Cozart noted that several members who supported Wednesday's action raised concerns about the higher bid Augenblick, Palaich and Associates submitted to a broader request for adequacy study proposals issued in the spring. That $943,605 proposal was ultimately rejected, and the committee issued a new bid request that had a narrower scope.
"The first time the proposal came in, they were just about to have a cow," Cozart said. "I guess that cow just jumped over the moon."
Officials from both Augenblick, Palaich and Associates and Shuls and Associates were a bit bemused by the General Assembly's process on this contract, and neither company committed to accepting a contract that would include simultaneous studies from both companies.
Justin Silverstein, co-CEO of Augenblick, Palaich and Associates, said that he wanted to confer with his team before making a final commitment, though he expected that the company would be willing to continue with the contract.
Augenblick, Palaich and Associates is one of the few firms in the country that conducts studies similar to the one being proposed in Arkansas. The firm has worked in all 50 states over the better part of the past four decades, and it has conducted adequacy studies in more than 20 states.
"We haven't seen a process quite like this," Silverstein said after Wednesday's meeting.
Silverstein said that Ballinger was correct that his firm had often recommended significant funding increases, but that those recommendations typically came in states that were in the early stages of educational adequacy -- like Arkansas in 2003.
This study, Silverstein said, is tailored to look at the state's funding process and structure, not whether school spending is adequate. Thus, he said his firm would not be providing any "full-system dollar amount" recommendations.
MISSOURI GROUP
Shuls and Associates is a newly formed group that was created in August with the Arkansas contract in mind. James Shuls, an assistant professor at the University of Missouri-St. Louis, formed the company, and he proposed partnering with the University of Arkansas' Office for Education Policy and a handful of other individuals to study Arkansas' education funding methods.
Several lawmakers questioned the timing of Shuls and Associates' formation as well as the publicized opinions on school choice issues and teacher pensions by Shuls and other members of his team.
One lawmaker asked legislative staff to reach out to Shuls, among others, about bidding on the contract, which prompted questions from some other committee members, but that member never identified himself or herself when other committee members asked. Bureau of Legislative Research staff say they are precluded from divulging conversations with lawmakers.
Shuls has said that he was never contacted by a lawmaker from Arkansas nor did he contact one.
The education committees did not vote to hire Shuls' group.
Shuls in a phone interview on Wednesday said that no one from the state had contacted him about possibly being re-included in the process. He said that he wanted to wait to comment until he had talked with his team and received official word from the state.
However, he did say that he was a bit frustrated by the process. He noted that the initial request for proposals was taken down earlier and reconfigured in hopes that more consulting firms applied.
"I formed a firm for that very purpose," Shuls said, noting that these projects and the bidding process is long and complex. "Then, they question my character. And they wonder why there are so few firms who do this work."
House Speaker Matthew Shepherd, R-El Dorado, attended the subcommittee meeting on Wednesday. He said in an interview that he became somewhat involved in the process because there was a lot of disagreement about how to approach the consulting contract.
He said he hoped that hiring both groups would find a "middle ground," and he said he didn't think the Policy Making Subcommittee's action undermined the education committees. He said that under Wednesday's proposal, the education committees would still receive Augenblick, Palaich and Associates input just as they would have if that was the only company hired.
Gov. Asa Hutchinson has typically said he defers to the General Assembly when it comes to the education adequacy process. He stuck a similar tone Wednesday when asked if he had an opinion on how lawmakers should proceed.
"Determining adequacy is a legislative responsibility and I trust they will fairly determine what professional assistance of this nature is needed," the Republican governor said in a statement. "I am not personally familiar with the selected firm but I look forward to receiving their insights."
Metro on 11/14/2019