This issue resonates with voters around the country. When the public feels that property taxes are too high, politicians have to rise to that occasion. These spending differences undoubtedly understate the existing inequities in educational outcomes because they do not account for cost differences, which tend to favor richer districts. The Detroit Public Schools, for example, are the nation's seventh-largest district, with 169,000 students, and are located in one of the nation's poorest cities, with a 1990 poverty rate of 32.4 percent. This district faces massive organizational problems, deteriorating facilities, and few family resources to support school programs.
Similar disparities exist in other states.
Moreover, twenty-eight other states are confronted with lawsuits concerning the equity of their method for financing elementary and secondary education. Proposal A Proposal A increases the state sales tax, which applies to all purchases except food, prescription drugs and heating fuels, from 4 to 6 percent. The proposal also establishes several new state requirements for schools and allows districts and higher educational institutions to sponsor public school academies. Property taxes are not completely eliminated under Proposal A. First, a new state-wide property tax will be levied, with the revenue dedicated to schools. This tax must be levied on homestead property alone until the homestead rate equals the nonhomestead rate and will be rolled back in future years if the district's revenue grows faster than inflation.