MA'ILI — Despite doubts over whether it is fair, the Board of Education yesterday approved a new funding formula that radically changes the way money is allocated to Hawai'i's public schools.

However, the board limited the impact of the "weighted student formula" in its first year because of the huge financial implications for some campuses.

Beginning next year, school allocations will for the first time be tailored to individual student need. Because the formula will take from some schools and give to others, it means the loss of hundreds of thousands of dollars to some campuses by the time it is fully implemented in four years.

Amid widespread concern over such losses, the BOE — in a 7-4 vote — decided to comply with a legislative mandate to implement the formula but moved cautiously, restricting schools' gains or losses to 10 percent in the first year.

Schools Superintendent Pat Hamamoto has said the Department of Education would work with that, though DOE officials had indicated that anything less than 25 percent would not be enough to significantly help most schools.

Board members emphasized that the formula would be re-evaluated and potentially adjusted in the coming year.

Before the vote late last night at a meeting at Ma'ili Elementary School, both opponents and supporters in the audience of about 80 people spoke out.

Roger Takabayashi, president of the Hawai'i State Teachers Association, asked the board to wait "until the formula can be worked out and the schools taking the hits can be adjusted."

But Nanakuli High & Intermediate teacher Kimo Keli'i was in favor of passage, saying the formula provides "much-needed funding for schools on the Wai'anae Coast."

Disa Hauge, principal of Ma'ili Elementary, also favored implementing the formula, saying "change that's slow and steady and methodical is best."

"It may not be perfect and may cause discomfort," said Hauge, "but for those of us who bring slippers and shirts for the children ... for us the formula is a beacon, it gives us a sense you care about us."

SKEPTICS SPEAK UP

Before passing the new formula, the board launched into a strong debate, with members Paul Vierling and Darwin Ching advocating cutting money from the central DOE administration to come up with extra funding for schools losing money.

"In asking the schools to cut budgets, I'm asking the DOE to cut from their administrative budget," Vierling said.

Hamamoto said that would reduce services to the schools and would affect personnel.

"If it accomplishes more resources down to the schools and more local control, then yes, I'm in support of cutting positions," said Vierling.

The motion was defeated.

"It scares me we're going to vote for a formula that decreases funding for (some) schools," said board member Lei Ahu Isa. "Let's go back and ask (the Legislature) for surplus money."

State Rep. Roy Takumi, House education chairman, called the board's approval of the formula a good start to providing more equitable education throughout the state.

"Any journey begins with a first step," he said, in anticipation of the board's vote.

"Perhaps starting small is a prudent decision ... but come year two and three, let's not be shy about making some fundamental changes."

Takumi, D-36th (Pearl City, Palisades), said this is the beginning of a significant budgeting change that's "flipping the department on its head. ... Individual schools will drive that system. They'll be getting the majority of their operating budget and I cannot emphasize how big a shift that is. People don't realize how deep it is and how difficult it is."

The formula also gives Hawai'i's public school principals greater flexibility to use their budgets according to what their schools need.

SLOW TRANSITION

The formula is one of the cornerstones of the Reinventing Education Act passed by the Legislature in 2004, along with a 12-month work calendar for principals, a unified school calendar, and shifting education operations from other departments into the DOE. Principals began their 12-month calendar this year, and the unified school calendar takes effect with the next school year.

In taking a go-slow approach, the BOE was responding to worried principals, particularly those from smaller schools scheduled to lose money, and acting on the advice of longtime DOE budget director Lionel M. Aono, now retired. Aono had warned that the huge swings of money from smaller to larger schools indicated a flaw in the formula.

"The way it looks now it's skewed too much one way. It's highly discriminatory toward the smaller schools," said Aono, who served from 1965 to 1995.

In a memo to board members, Aono had recommended that they move slowly, implementing a change the first year of no more than 10 percent, and then having the formula evaluated by an independent third party to make sure it's fair.

"This will minimize the trauma and disruption to the schools," wrote Aono, "while giving the board (and everyone else) more time to clarify and understand the reasons for the change, its consequences on the schools, and a consensus among all interested parties, especially the schools, that the changes are reasonable and treat everyone fairly."

IN LIONEL THEY TRUST

Before last night's meeting, board member Karen Knudsen said Aono's memo and testimony were compelling.

"We all trust Lionel," said Knudsen. "He's the one who said 'Give it 10 percent to show good faith and continue working on it.' "

Knudsen said the board "did embrace Act 51 (the Reinventing Education Act) and we do want to move forward on this, we just want to make sure the formula is defensible and logical and doesn't hurt students."

The BOE's decision seemed acceptable to principals on both sides — those who will gain money and those who will lose money.

"It's probably better to go a little bit slower because this is such a huge change for all of us," said Farrington High School principal Catherine Payne, in anticipation of passage of a 10 percent increase for her school the first year.

Farrington is scheduled to receive a total of $1.3 million over four years, but now will get $131,825 the first year rather than the $329,562 proposed by department administrators.

"It's all right what they're doing because it helps schools which are ultimately losing the largest amount to not have such a dramatic shift," said Payne.

"And we'll still have the flexibility we don't currently have. So it's OK to go a little slower."

In a small school such as Waikiki Elementary, where principal Bonnie Tabor is scheduled to lose $17,355 the first year of implementation, the smaller loss in the first year is more manageable.

"We will be able to deal with it," said Tabor, although she doesn't know how.

"But I see it as an interim measure," Tabor said. "It buys us time to look at how we can work together to develop a more effective way of determining the weights so that it's not going to harm the smaller schools."

SMALL-SCHOOL BLUES

The Waikiki School Community Council sent a strongly worded letter of concern to every board member three weeks ago, saying the weighted student formula "is poised to destroy small schools in Hawai'i."

"Students in small schools, ones with populations of less than 400, will be forced to have fewer services and larger classes than their larger school counterparts," wrote the council.

"When you have fewer students, basic operational costs eat up a greater proportion of each student's allocated amount. This leaves less funding for a school's most desperate need — teachers in the classroom."

Though he voted with the majority to approve the formula, board member Garrett Toguchi said beforehand that he was very concerned about schools that will lose money so that others could receive more.

"Why take from Peter to pay Paul?" he said.

And he worried that schools that lose money will eventually be put in the same position as those that haven't had enough in the past.

"If there's fat in these schools losing money, then where's the fat?" he said. "It's one of the things we've been trying to get from the DOE. Show me the fat. They haven't done that.

"If they can do that, it makes the decision to stick with the formula and fully implement it more palatable."

Reach Beverly Creamer at bcreamer@honoluluadvertiser.com.