Enlow: Other States Trying to Emulate Indiana on Vouchers, Charter School Law

The following guest blog is part of our weeklong celebration of National School Choice Week:

Around this time last year, the national spotlight was on Indiana because of a battle in the state capital. No, not right-to-work – the Super Bowl. But in the absence of that spectacle, the nation continues to keep a watchful eye on Indiana for the transformative changes made to its education system – particularly in the area of school choice.

Our state continually ranks at the top in the educational opportunities it provides Hoosiers. With vouchers, Indiana has the largest eligibility window of the other 11 voucher-providing states: 530,000 low- and middle-income students statewide, 9,324 of whom opted for vouchers in the program’s second year. The state has the sixth-best charter school law in the nation, according to the National Alliance for Public Charter Schools. And in the Center for Education Reform’s “Parent Power Index,” which compiles a number of education reform measures that empower families, Indiana ranks number one.

Hoosiers should know that other states have tried for years to adopt pieces of the package Indiana approved. And make no mistake, other states need to pass those measures because our country has been woefully lagging, and overspending, in attempting to prepare our young people for college, careers and life.

In 1966, the federal government provided $2 billion for public education (using 2006 dollars). In 2005, that number increased to $25 billion. In 2010, total federal spending on K-12 education reached $47 billion. Meanwhile, data from the National Assessment of Educational Progress (NAEP) show a history of education outcomes not keeping pace with those increased expenditures. In 1971, the average score for eighth graders on NAEP’s reading exam was 255 (on a 500-point scale). In 2011, that number stood at 265. For fourth graders over that same time period, the average score bumped from 208 to 221.

School choice, on the other hand, has proved its positive effect on increasing student outcomes at around half the cost. Of the 10 random-assignment studies – considered research’s “gold standard” – conducted on school vouchers, nine showed they positively impact student performance; one found no effect. And among the empirical studies examining school choice’s effect on other schools, all but one found competition improves traditional public schools; again, one found no effect. None concluded there is a negative impact.

That’s why states – this year’s list includes Alaska, Maine, Mississippi, Tennessee, and Texas – are trying to emulate Indiana. And they must. Such policies may not be as fun as the Super Bowl, but their effects are certainly game-changers for taxpayers, schools, parents, and those who matter most: students.

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Robert Enlow is president and CEO of the Indianapolis-based Friedman Foundation for Educational Choice, which is participating in National School Choice Week, January 27-February 2. More than 100 Indiana schools are holding events during the weeklong celebration for school choice.

Poll: We’re Striving to Thrive But Falling Short

Gallup is certainly one of the kings when it comes to the polling world. Its latest effort, the Gallup-Healthways Well-Being Index, seems to require a bit more interpretation than most.

Respondents were asked to rate their lives today and their expectations for their lives in five years. The answers lead to classifications of ‘thriving," "struggling" or "suffering." Indiana finds itself on the bottom 10 list of states with the lowest percentage of residents thriving.

Biggest improvement from 2011 to 2012: South Dakota, third overall; biggest drop over the last year: Alaska. In somewhat of a contrast, South Dakota was also among the four states (with Wyoming, West Virginia and Vermont) that are "least optimistic" about five years from now compared to today. In the "most optimistic" category for five years hence, honors go to Louisiana, Georgia, Texas, Florida, Ohio (breaking the Southern monopoly) and Hawaii.

Top 10 "thrivers" in 2012: Hawaii, Utah, South Dakota, Maryland, Texas, New Hampshire, Nebraska, New Mexico, Colorado and Minnesota. The bottom 10: West Virginia, Maine, Delaware, Nevada, Oregon, Tennessee, Kentucky, Ohio, Indiana and Florida.

What does it mean? In Gallup’s words:

Gallup’s research has shown that people take a variety of factors into account when rating their lives. While this thriving measure doesn’t always align perfectly with macro-level trends on economic indicators such as economic confidence and job creation, it is known to correlate with personal factors in one’s own life including career, social, physical, financial, and community wellbeing. To that end, the states that do best overall in "thriving" are similar to those best positioned for future livability based on a variety of factors encompassing economic, workplace, community, and personal choices. As such, it remains clear that a broad-based approach will likely fare best in terms of improving how residents rate their lives and their level of optimism for the future.

 

Gigerich Breaks Down U.S. Chamber Enterprising States Report

Larry Gigerich of the highly respected site selection firm Ginovus penned a column for Inside INdiana Business, in which he relays and analyzes a recent report from the U.S. Chamber of Commerce (to whom we have no direct affiliation) listing the top enterprising states. Interesting stuff:

The Chamber breaks policies down into five major areas.

1. Exports and International Trade
2. Entrepreneurship and Innovation
3. Taxes and Regulation
4. Talent Pipeline
5. Infrastructure

The report combines metrics for the different policy areas to measure performance, which has allowed the Chamber to evaluate the top states based upon quantifiable measurements. Please find below a list of the measurements used to rank the states.

1. Long-term job growth
2. Short-term growth
3. Overall expansion of gross state product
4. Productivity – state output per job
5. Productivity growth – growth in output per job
6. Income growth – growth in per capita personal income
7. Livability – median income of four-person households, adjusted for state cost of living

Based upon the metrics used by the U.S. Chamber of Commerce, here are the top performing states and a brief summary of why they rank in the top 10.

1. North Dakota: The state ranked in the top 10 in six of the seven measurements. The state ranked first in short-term jobs, long-term jobs, gross state product and per capita personal income. The energy boom in the western part of the state has led the growth of the economy in the state.

2. Wyoming: The state ranked in the top 5 in five different categories. The state is second on long-term job growth and gross state product and third in productivity growth and income growth. Energy, chemicals and metals helped drive the performance of the state’s economy.

3. Virginia: The state has the highest income in the nation, after adjusting for cost of living. In addition, Virginia ranks in the top 25 in all seven categories. The state’s growth in professional services and information technology jobs has helped led to excellent results.

4. Alaska: The state ranked in the top 8 in three key areas: overall productivity, long-term job growth and gross state product. Alaska’s economy has been driven by energy, mining and tourism activities. The growth of these sectors has led to the significant growth of retail support entities in the state.

5. Maryland: The state ranked in the top 25 in all seven measurements. Maryland ranked the highest in adjusted family income, followed by productivity growth. The growth in government jobs in the Washington D.C. area, high technology growth and corporate headquarters helped to propel the state.

6. Texas: Texas ranked second in short-term job growth and fifth in long-term job growth. In addition, the state fared well in the growth of gross state product. Its energy sector, affordability, and business climate fueled economic growth throughout Texas.

7. South Dakota: The state ranked fourth in growth in gross state product and per capita income. Long known for its back-office finance operations due to its well educated workforce, South Dakota can credit growth in manufacturing and professional services for propelling its economy today.

8. Washington: The state of Washington jumped five spots from 2011 largely due to rapid short-term job growth. In particular, aerospace and transportation equipment manufacturing has been growing rapidly. Professional services and technology have also been growing significantly.

9. Iowa: The state ranked fifth in growth in economic productivity, sixth in per capita income growth and eleventh in gross state product. Iowa’s finance and insurance industries have grown by nearly 30 percent. Transportation and warehousing are also growing rapidly.

10. New York: The state ranked in the top 25 in six of the seven measurements. The state jumped eleven spots in this year’s rankings due to the rapid growth of gross state product and per capita income. The rebound in the financial services sector, coupled with the growth of educational entities have assisted New York in these rankings.

Power Producers: Texas Leads the Way

Who doesn’t love a good list? If you’re in the energy business or just have an interest in which states are leaders in various production categories, check out this information from the U.S. Energy Information Administration:

Coal production (2010)

  1. Wyoming (442,522 thousand short tons)
  2. West Virginia (135,220)
  3. Kentucky (104,690)
  4. Pennsylvania (58,593)
  5. Montana (44,732)

Natural gas marketed production (2010)

  1. Texas (6.7 million cubic feet)
  2. Wyoming (2.3 million)
  3. Louisiana (2.2 million)
  4. Oklahoma (1.8 million)
  5. Colorado (1.5 million)

Crude oil production (2011)

  1. Texas (49,233 thousands of barrels)
  2. Alaska (18,956)
  3. North Dakota (16,581)
  4. California (16,454)
  5. Oklahoma (6,584)

Total net electricity generation (2011)

  1. Texas (33,689 thousands of megawatt hours)
  2. Pennsylvania (19,161)
  3. California (17,167)
  4. Illinois (16,851)
  5. Florida (16,845)

And a few more natural gas numbers courtesy of a State Legislatures article:

  • 90 years: estimated supply of domestic natural gas at current consumption levels
  • 24 trillion: cubic feet of natural gas used annually in the U.S.
  • 26%: amount of the nation’s electricity generated by natural gas in 2011
  • 25,400: number of wells fractured or re-fractured each year to produce natural gas

Senators Challenge “Donor State” Issue

The term “donor” usually refers to a person who bestows something voluntarily – a vital organ to a person in need or blood to a blood bank; even someone offering money to an organization without expecting anything in return is considered a donor. 

But, Indiana’s title as a financial “donor state” in the federal transportation system has never been voluntary. (States that put more money into the federal transportation program than they receive out of it are considered donor states.) A total of 28 states have the moniker, and Indiana receives only 92 cents for every dollar given to the federal system.

To combat this inequity, Indiana Republican Dan Coats has joined with several other senators from around the nation in introducing the State Transportation Flexibility Act, legislation that would allow states to opt out of federal highway programs. The act gives states the flexibility to manage and spend the gas tax revenue collected inside each state on transportation projects without federal mandates or restrictions.

The federal gas tax is the biggest revenue generator for the federal highway trust fund. With more fuel efficient vehicles and people driving less on average, the gas tax has been pushed into a steady decline and the trust fund has been bailed out several times.

“For too long, Indiana has been a donor state and sent more gas tax dollars to Washington than it has received back,” Coats says in a press release. “This isn’t fair to Hoosier taxpayers, which is why I support the State Highway Flexibility Act. Hoosiers know our state’s transportation needs better than bureaucrats in Washington, and Indiana should be able to control its own resources.”

States that choose to opt out would have to continue to maintain the Interstate system in accordance with its current program, but all gas tax revenue gained inside its borders would be used at the state’s discretion on transportation projects without federal interference.

“Anytime you can eliminate a layer of federal bureaucracy from the state’s ability to govern, it is a good thing,” adds Sen. David Vitter (R-Louisiana) in the release. “The states know their transportation needs better than Congress, so let’s put them in the driver’s seat to manage their own gas tax.”

In 2009, Alaska received $3.28 for every dollar it put into the federal fund, the District of Columbia received $5.04 for every dollar and Montana, North Dakota, Rhode Island and Vermont had returns of greater than 200% that same year.

For more information on the federal highway transportation fund and the challenges Indiana faces with the current transportation funding system, check out the story "Stuck in Neutral" in the May/June 2011 edition of BizVoice®. 

A Little Fun in the Sun … or On the Strip?

Though children might shriek “Disneyland” when asked where they want to go on vacation, the “adult play land” of Las Vegas is the top choice for travelers in 2011, according to results from Travel Leaders’ 2011 Travel Trends Survey.

Vegas earned the top ranking once again, following a dominance from 2003-2009. But the children aren’t far off in their desire for Mickey and Minnie Mouse as Orlando narrowly missed first place by 0.36%, with travelers choosing the bright lights of Vegas over the magical world of Disney. Orlando edged out Las Vegas as the top destination spot for 2010.

The survey, which was conducted from November 3-30 and used actual booking data and responses from Travel Leaders owners and agents, determined the top ten domestic destinations for 2011. The list also includes (in descending order): an Alaskan cruise; Honolulu and Kahului (Maui) – tied for fourth place; New York City; Washington D.C.; a Hawaiian cruise; San Francisco; and Chicago and Phoenix – tied for tenth place. International vacation destinations included spots like Cancun, Rome, London, Jamaica, the Dominican Republic and several Mexican and Caribbean cruises.

Survey results also point to the fact that people are spending more on travel than they did last year, highlighting an optimistic outlook for 2011. The findings show that just over half of Travel Leaders clients will spend more this year on travel than they did in 2010, while about 38% will spend the same amount. That’s good news for the oft-struggling travel industry.

Let’s hear your top travel destinations for 2011: Will your children be successful at pestering you into taking them to Disneyland? Or, will what happens in Vegas, stay in Vegas?

Indiana’s Business Tax Climate: Not a Perfect One, But a Good 10

We’re No. 10! We’re No. 10! Not exactly the rallying cry one is used to hearing, but a refrain that deserves more plaudits than usual. Here’s why Indiana’s ranking in the Tax Foundation’s 2011 State Business Tax Climate Index is noteworthy:

  • It’s not easy to make substantial improvements in this area. Indiana has ranged between No.12 and No. 14 over the last five years
  • The top eight seemingly head the list by default as they do not impose one of the big three taxes (sales, income or corporate income). So, without too much of a stretch, you could say Indiana is second on the list
  • We’re far away from the bottom 10; in order from No. 50, that’s New York, California, New Jersey, Connecticut, Ohio, Iowa, Maryland, Minnesota, Rhode Island and North Carolina

The Indiana Chamber’s advocacy efforts certainly are contributing factors to the state ranking. Historic tax restructuring in 2002 (including elimination of the inventory and corporate gross receipts levies) is among the Decade of Policy Victories document reflecting major legislative accomplishments from 2000-2009. The Chamber has also achieved success in general property tax reductions and an expansion of a variety of tax credits (good for business, but not earning high marks in this report).

According to the Tax Foundation, the worst tax codes tend to have:

  • Complex, multi-rate corporate and individual income taxes with above-average tax rates
  • Above-average sales tax rates that don’t exempt business-to-business purchases
  • Complex, high-rate unemployment tax systems
  • High property tax collections as a percentage of personal income

Indiana’s rankings in the five categories are: corporate tax index, 21st; individual income tax index, 11th; sales tax index, 20th; unemployment insurance tax index, 12th; and property index, 4th.

Since this tax analysis game is not for the faint of heart, a little more from the Tax Foundation on how it all works.

The methodology of the State Business Tax Climate Index is centered on the idea of economic neutrality. If a state’s tax system maintains a “level playing field” for businesses, the index considers it neutral and ranks it highly. However, each state’s final score depends on a comparison with the other 49 states.

The overall index is composed of five specific indexes devoted to major features of a state’s tax system. Each of these five indexes is composed of several sub-indexes.

Each state’s laws and tax collections were assessed as of July 1, 2010, the first day of the 2011 fiscal year. Newer tax changes are the subject of commentary in an appendix but are not tallied in the scores and rankings.

The Tax Foundation has data charts, further analysis and a full 60-page report. By the way, you have to go west for most of the rest of the top 10 (in order): South Dakota, Alaska, Wyoming, Nevada, Florida, Montana, New Hampshire, Delaware and Utah.

And finally, going into a state budget year that will bring pressure to raise revenues, let’s all keep the vital importance of the tax climate in mind on business attraction and expansion decisions.

Disaster? Yes; Stop Drilling? No

Yes, there is an environmental disaster taking place in the Gulf of Mexico with the Deepwater Horizon oil rig explosion and spill. No, that should not mean the end of any future offshore drilling.

Four New Jersey Democrats have already written President Obama, asking him to reverse his earlier decision to open up a variety of East Coast, eastern Gulf of Mexico and some Alaska waters for drilling as well exploration of future oil and natural gas. And Florida Sen. Bill Nelson says he will introduce legislation to stop expanded drilling.

The White House is acting correctly. All rigs and platforms currently in use are being inspected. No additional drilling will take place until the current investigation is complete. Washington is taking this seriously, just as it did the determination to expand domestic oil production as part of an important national security strategy.

Accidents, with often tragic consequences, unfortunately happen — in this industry and nearly all others. (I’m not going to succumb to comparisons; I’ll take it for granted that you understand what I mean).  That does not mean we climb into a shell and refuse to utilize the resources and technologies that provide, in this case, vital energy supplies. We find out what went wrong, why it happened, make improvements and do everything possible to prevent future problems.

Education Reform With a Capital ‘R’

The challenges are no different than those many school districts are facing — unacceptable dropout rates, continually disappointing test scores and an overall environment of "disconnection" between educators and their students.

The solutions for many are to tinker around the edges, adjust a regulation or adopt a policy to try to spark change. While well-intentioned, the results often disapppoint. In an opposite take on the old saying — if it isn’t broke, don’t fix it — education in many places is broke and requires a radical fix.

Implementation won’t begin fully until next year and ultimate results will be years down the road, but let’s give a Denver-area school district kudos for trying. How does doing away with traditional grade levels and strategically involving students in lesson plans grab you for starters? Students will advance when they have proven mastery of that subject. The Christian Science Monitor reports:

The district is training teachers to involve students in the lesson plan in a far greater way than before – the students articulate their goals and develop things such as a code of conduct as a classroom. And when children fall short of understanding the material, they keep working at it. The only "acceptable" score to move on to the next lesson is the equivalent of a "B" in normal grading – hopefully showing proficiency and giving kids a better foundation as they move on to more advanced concepts. Advocates sometimes describe it as flipping the traditional system around so that time, rather than mastery of material, is the variable.

While the idea of "standards-based education," as it’s often known, has been around for a while, the only public district where it’s been tried for any length of time is in Alaska, where the Chugach district – whose 250 students are scattered over 22,000 square miles – went from the lowest performing district in the state to Alaska’s highest-performing quartile in five years in the 1990s, a shift the former superintendent, Richard DeLorenzo, attributes to the new philosophy.

Even before the opening bell, I give a hearty "A" for effort. Read the story here. Let us know what you think.

U.S. Senate Seats Can Provide More Drama than “Laguna Beach”

A new article on Stateline proves that Blagojevich’s Senatorial dealings are far from the first drama to surround a vacant U.S. Senate seat. Granted, I doubt any of these governors were caught on tape dropping F bombs of glee over the opportunity to personally benefit over the appointments, but interesting nonetheless:

In Alaska in 2002, newly elected Gov. Frank Murkowski (R) appointed his daughter, Lisa, to the Senate seat he himself had vacated. The move caused such an uproar that both the Legislature and later voters — through a ballot measure approved in 2004 — took away the governor’s appointment power. Alaska now holds elections to choose substitute senators, and Murkowski later was voted out of office in a Republican primary, losing to current Gov. Sarah Palin. 

In Massachusetts in 2004, Democratic lawmakers — worried then-Gov. Mitt Romney would appoint a fellow Republican to Democratic Sen. John Kerry’s seat if Kerry won the presidential election — stripped Romney of his power to do so. Voting on the proposal — which replaced the appointment process with a special election — broke sharply along partisan lines.

Also noteworthy is that current Wyoming Gov. Dave Freudenthal – a Democrat – was the last governor to fill a vacant Senate seat with someone from the opposing party. This happened last year when Republican Senator Craig Thomas passed away, and Wyoming’s law dictated that the seat be filled by someone from the same party as the person who vacated it. Freudenthal chose Republican John Barasso.