Financial Fix? Mixed views on state's education funding formula

One local legislator says the new formula doesn’t make the grade. Though the funding formula approved by the General Assembly in 2005 determines each district’s funding level using weighted measures, the formula merely spells out how much districts should receive – not how much they will actually receive.

“I believe we’re not doing what we said we would do, which is making education the top priority after debt – which is what the Constitution says,” said Rep. Sara Lampe, D-Springfield. “People say, ‘Well, Sara, how much money do they need?’ They need however much (the Department of Elementary and Secondary Education) says they need to do their jobs properly.”

DESE uses the funding formula to determine how much each of Missouri’s public school districts will receive from the state. State school funding is split between the general revenue fund and the Classroom Trust Fund, which is stocked through state gambling revenue.

Sen. Charlie Shields, R-St. Joseph, sponsored Missouri Senate Bill 287, which created the new formula. He said the formula makes funding more equitable across the state.

“Under the current formula, students are funded from $4,700 per student all the way up to about $13,000 per student,” Shields told the House Special Committee on Education Funding in 2005 when he presented the bill after it had passed the Senate.

He said the new formula funds all districts at about $6,100 per student, the average per student in the state’s highest-performing districts.

The formula takes a district’s average daily attendance and adjusts it based on summer school attendance, students using free and reduced lunch programs, special education students and students with limited English proficiency.

That number is then adjusted again based on the average wages in the district’s city, through a figure called the dollar value modifier. It is then multiplied by the average spending per student in districts that received a perfect score on the state’s Annual Performance Report, referred to as the state adequacy target.

“The formula is much simpler than the two previous formulas that I worked with as a superintendent of schools,” said Roger Dorson, director of school finance for the Missouri Department of Elementary and Secondary Education. Dorson previously served as superintendent of the Salisbury R-IV School District.

Adequate funding?

While the latest formula may be simpler than its predecessors, not everyone agrees that it solves education funding woes.

Steve Chodes, director of finance for Springfield R-XII School District, said that while the district will see an increase in funding – an estimated $40.9 million in state money for 2007–08, up 6 percent from 2006–07 – he can’t directly attribute that to the new formula.

Lampe also pointed to the issue of earmarked money for specific student groups, such as gifted children or children with autism. The old formula, she said, set aside money for those groups to ensure they would receive the needed money from their local districts. The new formula includes fewer student groups, which Lampe said could leave some without vital money.

“I agree that school districts need to be able to make decisions locally,” she said. “But when you have groups that people don’t know a lot about, they don’t have the information to make a decision on it, especially if it only affects a few kids.”

A long transition

Another issue is the transition to the new formula. The 2005 bill spells out a seven-year period during which the state will gradually move from the old formula to the new. That period is designed to prevent a radical jump in state funding that could negatively impact other state services.

Lampe said it still comes down to what the legislature will allocate. For example, during the first year under the new formula, only 15 percent of funding was based on the new formula; the rest came from the old formula.

Springfield’s Chodes agreed that the district does stand to lose out on some money that it would receive if the new formula were entirely in place. He added that it’s difficult to say how much funding the district could lose out on, because it’s difficult to determine how much the district would get if funding was totally decided by the new formula.

While Chodes doesn’t think the new plan is perfect, he said it’s better than the old formula.

“It’s not going to be a (cure-all), but it’s definitely going to help,” Chodes said. “If we’d stayed under the old formula, we’d definitely have less funding.”

Funding Formula

Missouri’s education funding formula determines how much money each school district should receive to ensure adequate and equitable funding, though it doesn’t require the legislature to actually allocate that amount.

The example below shows how much Springfield R-XII School District has budgeted for state funding for the 2007–08 school year. The amount that will be received is not yet known.

(Note: State school funding is split between the general revenue fund and the Classroom Trust Fund, which is stocked through state gambling revenue.)

Springfield R-XII School District

Weighted Average Daily Attendance: 23,567

State Adequacy Target: $6,117

Dollar Value Modifier: 1.034

Total 2007–08 state funding: $40,897,607

Source: Springfield Public Schools