Doctoral Dissertations

Date of Award

3-1981

Degree Type

Dissertation

Degree Name

Doctor of Education

Major

Educational Administration and Supervision

Major Professor

Dewey H Stollar

Abstract

The purpose of this study was to assess the interim effects of the 1977 Tennessee Education Finance Act in terms of both fiscal equity and fiscal neutrality for the first year of the legislation's implementation. The study was accomplished by examining selected public school revenues, expenditures and their sources during the school year prior to the implementation and by comparing the results with those of the first year of the Act's implementation. This required the compilation of similar data for all existing school divisions within the state for two years.

The origins of all data used in the analysis were the Tennessee State Departments of Education or Revenue, the University of Tennessee County Technical Assistance Service and the United States Department of Commerce. The computing facilities at the University of Tennessee, Knoxville, were utilized in performing the various descriptive statistics employed in this study. The variables of interest in this study were: local equalized revenue, local unequalized revenue. State revenue. Federal revenue, total revenues per pupil, instructional expenditures per pupil, adjusted property tax rates, and local school division personal income.

The major finding of the study was that the implementation of the Education Finance Act and the change to the weighted pupil method of funding the schools across the state did foster greater fiscal equity and neutrality. However, in fiscal equity, there was exhibited no change toward more equitable adjusted property tax rates.

The three types of fiscal neutrality investigated in this study were ex ante, ex post and income. The area of unequalized local revenue made the greatest advance toward fiscal neutrality in all three types. The revenues derived from state sources remained directly related to the income level of the school districts.

Federal revenues, while not directly addressed in the Education Finance Act, remained related to both the level of income and property wealth. Total revenues received by the school districts were neutral in all areas except income. There was a continuation of the relationship between instructional expenditures and local school division property wealth. In addition, the relationship between the amount of property wealth and the adjusted tax rate of districts went unchanged. Overall, there seemed to be greater strides made in the removal of relationships between the sales and property tax rates and the variables of interest. The relationship of income and the variables of interest either remained the same or exhibited change toward less neutrality.

Educational policy makers at both the state and local levels need information, which is derived from broad based economic data, to make valid decisions concerning the fiscal well-being of all local school divisions. This information should be of such quality that the administrators of both the State Department of Education and local school divisions will be able to perform long-range resource planning.

In a rapidly changing economy there is need for constant yearly assessment of the status of the statewide school finance situation. This action needs to be reinforced by the provision of quality technical assistance to local school divisions by an established partnership of the State Department of Education and institutions of higher education within the state.

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