The following analysis is based on Governor Kasich’s Executive Budget Proposal for Fiscal Years (FY) 2012 and 2013. The following chart is based on “ALL FUNDS” dollars, not just state foundation aid:

Category	Current FY 2011	Proposed FY 2012	% from FY 2011	Proposed FY 2013	% Fromy FY 2012	Total Change
K-12 Education	$11.5 bill	$10.2 bill	(11.5%)	$9.7 bill	(4.9%)	($3.1 bill)
Higher Education	$2.57 bill	$2.3 bill	(10.5%)	$2.4 bill	3.7%	($440 mill)

K-12 SCHOOL DISTRICTS:

K-12 Funding:

Decrease overall education funding by $3.1 billion over FY12-13 from FY 11 amounts ($1.3 billion cut in FY 12 and $1.8 billion cut in FY 13)
Repeals Evidence-Based Model for school funding
Increase state foundation funding by 2% for FY 12 and 1.5% for FY 13 (not the whole story)
Eliminate state fiscal stabilization $ (fed stimulus for state foundation) of $457 million in FY 12.
Reduce federal stimulus for IDEA Part B and Title IA totaling $400 million in FY11 by 90% for FY 12 with the remainder eliminated in FY13
Decrease overall Special Education funding by 14.5% in FY 12 and another 2.1% in FY 13.
Decrease TPP “hold harmless” payments by $428 million (37.2%) for FY12 and by another $247 million (34.2%) in FY 13. Reductions at school district level will be capped at 2% per year
Decrease gifted funding by 88.2% in FY 12 and flat-lined in FY 13
Reduces Kilowatt Hour tax reimbursement
Decrease overall funding for early childhood education by 4.7% in FY 12 and .5% in FY 13
Maintain current levels of overall funding for Joint Vocational School Districts in FY 12 and FY 13
Diverts more funding from local school districts by expanding charter schools & vouchers

Teacher Salaries Removed From Collective Bargaining: 3317.14

Each school district board of education and ESC shall annually adopt a teacher’s salary schedule with a minimum and maximum salary for the following categories of teacher licensure status:
1) Resident educator license, an alternative educator license, or a temporary, associate or provisional educator license,
2) professional educator license or a professional or permanent teacher’s certificate,
3) senior professional license,
4) lead professional license.
For each teacher employed by a school board, the board annually shall designate a salary within the salary range of the appropriate board adopted salary schedule that considers the following factors:
1) Teacher evaluations;
2) highly qualified status;
3) any other relevant factors, which may include whether the teacher teaches in a hard-to-staff district or subject area, teachers class sizes that are larger than average, or teaches at-risk students.
If a salary paid to a teacher is higher than the maximum salary that the teacher may earn under a salary schedule adopted by the board, the board shall designate the salary paid to the teacher on that date as the teacher’s permanent salary, unless a subsequent salary schedule adopted by the board has a higher maximum salary. Collective bargaining agreements expiring after the effective date of the bill run their course.
THE REQUIREMENT FOR LOCAL SCHOOL BOARD ADOPTION OF TEACHER SALARY SCHEDULES AND PLACEMENT OF INDIVIDUAL TEACHERS AT A SALARY WITHIN THAT RANGE PREVAILS OVER ANY CONFLICTING PROVISIONS OF A COLLECTIVE BARGAINING AGREEMENT ENTERED INTO AFTER THE EFFECTIVE DATE OF THE BILL.

Teacher Incentive Program:

ODE shall pay eligible classroom teachers an annual stipend of fifty dollars for each of the teachers’ students in classes that have achieved more than a standard year of academic growth, in one or more eligible subject areas taught by the teachers, as measured by the value-added progress dimension.
The program applies only to teachers in subject areas and grade levels for which value-added data is available under the value-added progress dimension, as determined by ODE.
If a student attains more than a standard year of academic growth in more than one eligible subject area, the fifty dollar stipend attributable to that student shall be divided among the teachers who taught those subjects.
If more than one teacher is responsible to teach a particular student in one eligible subject area, such as a team-teaching arrangement, the portion attributable to that student for that subject area shall be divided among the teachers who taught that student in that subject area.
The first stipends paid shall be based on student performance for the 2011-2012 school year as computed by for the school district and school report cards issued by ODE in 2012.

Teacher Dismissal:

Eliminates the option to hold teacher dismissal a hearing in front of a referee instead of the school board.
Any teacher whose contract is terminated may appeal to the court of common pleas or request execution of the grievance procedure specified in any collective bargaining agreement that is applicable, but many not do both. This limitation on appeal of dismissal prevails over any conflicting provisions of a collective bargaining agreement entered into on or after the effective date of the bill.
When implementing a reduction in teachers, a school board or ESC board shall consider the relative quality of performance the principal factor in determining the order of reductions. Quality of performance is measured by level of license, highly qualified status, performance evaluations under 3319.111, and any other criteria established by the board. Seniority may be considered, but only after considering these other factors.
Eliminates preference in dismissals for teachers with continuing contracts. If a teacher contract is suspended in part, teachers with continuing contracts have the right of restoration to continuing service status if positions become open, but not in the order of seniority service to the school district or ESC.
All of the above provisions prevail over any conflicting provisions of collective bargaining agreements entered into on or after the effective date of the bill.

Teacher Testing:

The board of education in each school district ranked in the lowest ten percentiles of performance index score (3302.01) by ODE shall require each of its classroom teachers in a core subject area (3319.074) to register for and take all written examinations prescribed the state board of education for licensure to teach that core subject area and grade level.
Each district board of education may use the results of a teacher’s examination in developing and revising professional development plans and in deciding whether or not to continue employing the teacher, in accordance with statutory dismissal processes. Test scores cannot be used as the sole basis for a decision to terminate or non-renew a teacher unless the teacher has not passed the exam three consecutive times.

Parent Takeover of Schools:

A parent initiated takeover may be conducted for any public school (city, exempted village or local) that has been ranked by ODE in the lowest five percent of performance index scores for three or more consecutive school years.
If the parents or guardians of at least fifty percent of the students enrolled in a school eligible for a parent initiated takeover sign and file with the school district treasurer a petition for one of the following reforms, the school board shall implement the requested reform in the next school year:
Reopen the school as a community school; replace at least seventy percent of the school’s personnel who are related to the school’s poor academic performance; contract with another district, non-profit or for-profit entity to operate the school; turn operation of the school over to ODE; any other major restructuring of the school that makes fundamental reforms in the school’s staffing or governance.

Creation of Innovation Schools:

Any public school may (city, exempted village or local) apply to the district board of education to be designated an innovation school.
The innovation school application must include a plan with specified provisions, including a description of any laws in ORC Title 33, rules adopted by the State Board of Education, requirements by the district board, or provisions of a collective bargaining agreement that would need to be waived to implement the innovation plan.
Evidence must be shown that a majority of administrators and teachers assigned to the school consent to seeking the innovation school designation, as well as a statement of support from other staff in the school, students and parents and members of the community.
Each CBA entered into on or after the effective date of the bill must allow for the wavier of any provision in the agreement specified in an approved innovation plan as needing to be waived to implement the plan, contingent upon at least sixty percent of the members of the bargaining unit covered by the CBA who work in the school voting, by secret ballot to approve the waiver.

Sanctions for “Poor Performing” Schools:

For any school building ranked in the lowest five percent of schools based on performance index scores for three consecutive years and is declared to be under academic watch or emergency, the district board of education shall do one of the following:
Close the school and reassign students to other buildings with higher achievement; contract with another district, non-profit or for profit entity to operate the school; replace the principal and all teaching staff of the school; reopen the school as a conversion community school.

Determining “Classroom” And “Non-Classroom” Expenditures:

ODE shall develop standards for determining the amount of annual operating expenditures for classroom instructional purposes and for non-classroom purposes for all public schools and community schools.
ODE shall rank each district and community school from highest to lowest in terms of percentage spent for classroom instructional purposes and non-instructional purposes.

School District Rankings and Recognition:

ODE shall develop system to rank all public schools districts and community schools according to the following measures:
Performance index score; student growth from year to year using value-added dimension if applicable or other measures designated by state superintendent; performance measures requires for career-technical education; current operating expenditures per pupil; percentage spent on classroom instruction.
Establishes the governor’s effective and efficient schools recognition program, whereby the governor shall recognize the top ten percent of all public and chartered nonpublic schools in the state.

Distance Learning:

The Ohio Board of Regents clearinghouse of interactive distance learning courses for students in K-12 shall be based, in part, on the following principles:
Students may take distance learning courses for all or any portion of their curriculum requirements and may utilize a combination of distance learning courses and courses taught in a traditional classroom setting.
Students may earn an unlimited number of academic credits through distance learning courses.
Students may take distance learning courses at any time during the calendar year.
Student advancement to higher coursework shall be based on a demonstration of subject area competency instead of completion of any particular number of hours of instruction.
A school district or charter school is not required to pay the fee charged for a course offered through the clearinghouse.

EDUCATION SERVICE CENTER SERVICES:

Requires school districts (except cooperative education school districts) with an average daily membership of 16,000 or less to enter into an agreement with an ESC to provide services to the school district.
A school district with less than 16,000 students may enter into an agreement with an ESC for services. These services may include any services the district board and ESC board agree can be better provided through the ESC.
An ESC may enter into a contract with a political subdivision to provide services.

CHARTER SCHOOL PROVISIONS:

Eliminates caps on numbers of charter schools in “challenged” districts: An unlimited number of “start-up” charter schools may be established in any “challenged” school district. Restrictions on “start-up” charter school expansion in 3314.013, 3314.014, 3314.016 and 3314.017 are removed. A “challenged” school district is district in that is either in a state of academic watch or emergency, a “big eight” school district, or the Lucas County pilot project area. (331402(3))
Charter school sponsor & operator restrictions: If a charter school is under academic watch or emergency on the effective date of the bill, the school’s sponsor and operator shall not be permitted to sponsor or operate any additional community schools. Contracts with such sponsors that have been entered into prior to the effective date of this bill are void if the schools have not yet opened by the effective date. Contracts with such operators are void where they are to begin operating a school in the 2011-12 school year.
Leasing school district property to charter schools: If a school district board of education decides to lease space it must first be offered to the governing authorities of charter schools located within the territory of the school district.

VOUCHER EXPANSION:

Increases the number of vouchers in the Ed Choice program from 14,000 under current law to 30,000 in the 2011-12 school year and 60,000 in the 2012-13 school year.
Expands eligibility to students assigned to school buildings that ranked in the lowest 10% in performance index score in two of the last three years.

PENSION AND HEALTHCARE:

Beginning July 1, 2011, increases the employee contribution for members of STRS, SERS and OPERS to 12% of their salary (from 10%).
Simultaneously decreases employer contributions from 14% to no more than 12%.

Health Care Pooling:

Eliminates the School Employees Health Care Board.
Directs the Department of Administrative Services (DAS) to contract with a consultant to recommend a program of pooling. Upon completion of the of the consultant’s report DAS shall implement health care plans that may be used by school districts (not charter schools), ESCs, higher education institutions and political subdivisions.
Consultant’s report shall include recommendations on the following: establishment of regions; viability of voluntary or mandatory participation; use of PPO, closed panel or HAS plans to stabilize costs and premiums; system to obtain data; use of competitive bidding; experience of other states; strategies for transition; option of joining existing consortia; mandatory or optional coverages; risks; legislative language needed; reserves and stop-loss.
Maintains best practice standards of SEHCB and allows DAS to adopt standards until release of initial plans.
DAS, subject to competitive selection process, shall negotiate with one or more insurance companies for issuance of health care plans. Plans may be self-insured.
Shall determine best practices, regions and cost-effectiveness.
DAS shall design plans and set employer and employee premiums.
Consortia representing 2,500 or more employees may request permission to continue offering plans from DAS.