PROVIDENCE — Rhode Island lags behind the national average in higher education spending, and while it “considerably overspends” on K-to-12 education, those investments aren’t producing great test scores or getting to the cities that need help the most.
Those are some of the findings the Rhode Island Public Expenditure Council released Monday in an analysis of “How Rhode Island Compares” to the United States and the rest of New England on state and local revenues and expenditures.
Rhode Island’s higher education expenditures are 29.5 percent lower than the national average on a personal income basis and 29.9 percent lower than for the United States and New England on state and local revenues and expenditures.
“We have not been investing in higher education for a considerable period of time,” said the council’s president and CEO, Michael DiBiase. “So if there is a strong connection between education and economic development, I think it has to disadvantage us.”
But he noted that voters did just approve a $107.3 million bond item that will provide $57.3 million for a University of Rhode Island Fine Arts Center, $38 million for a Rhode Island College Clarke Science Building renovation, and $12 million for Community College of Rhode Island renovations.
Also, he noted that the state’s top legislative leaders want to continue providing free tuition to eligible students at CCRI as part of the Rhode Island Promise program championed by the former governor, Gina M. Raimondo.
But one-time borrowing and the CCRI tuition program “won’t materially move Rhode Island’s underinvestments,” DiBiase said. Other states, such as Ohio and North Carolina, make much more significant investments in public colleges, he said.
While lower than the national and New England averages, Rhode Island’s higher education spending is the second-highest in New England on a personal income basis and fourth-highest on a per capita basis, the council found. Vermont significantly outspends the region and nation on education overall, including higher education.
While New England is home to many private colleges, graduates of public colleges often stay in the state and are therefore an important part of its economy, DiBiase said.
While lagging the nation in higher education spending, Rhode Island is ahead of the national average in spending on K-12 education: Elementary and secondary education expenditures in Rhode Island are 13.6 percent higher on a personal income basis and 13.1 percent higher on a per capita basis.
But, despite being “relatively generous” in K-to-12 spending, “student outcomes are average to below average, so questions arise about whether we are getting a return on investment,” DiBiase said.
A decade ago, the state adopted an education funding formula that aimed to get money to where it was needed the most, he noted. But it’s not clear that the formula is achieving that goal since schools districts such as those in Pawtucket and Woonsocket are among the lowest in per-pupil expenditures, and the Providence and Central Falls districts are merely middle of the pack, he said.
“I do think there has to be a serious conversation on the school funding formula,” DiBiase said. “People say the problem is Woonsocket and Pawtucket haven’t put more money in, but there is not a lot of property wealth in those communities.”
The report found that, like other New England states, Rhode Island has an outsized reliance on property taxes when compared to the nation — 42.3 percent of total revenues in Rhode Island, compared to 32.8 percent nationwide.
But the share of Rhode Island’s total tax revenues attributable to property tax fell from 45.7 percent in fiscal year 2013 in large part because the education funding formula took effect in 2010, leading to increases in state support for K-to-12 education and decreasing the share of local dollars going toward education.
“Rhode Island policymakers should consider further reducing the state’s reliance on property taxes, since the state’s relative over-reliance presents a challenge to equitably funding K-12 schools,” the report states.
The report uses the most recent available state and local revenue and spending data compiled by the Census Bureau (for fiscal year 2018) to compare Rhode Island to the United States and New England on a per capita basis and per $1,000 of personal income. The report provides historical perspective for Rhode Island by comparing data from 2013 to 2018.
With this report, the council is introducing a series of interactive datasets on its website, with 50-state breakdowns of key revenue and expenditure data.