JFC Budget: $0 Increase in Resources in First Year, $100 Increase in Second Year

While the additional $200 million in the K-12 budget adopted by the Legislature’s budget-writing Joint Finance Committee (JFC) late last night is welcomed, it is important that school board members view this increase in context.

Of the $200 million added by the JFC’s actions, $127 million simply restores the proposed cut in per pupil aid in the first year (2015-16) of the two-year state budget (That aid will be paid on a delayed basis in July 2016, which means it will be paid in the next fiscal year). The remainder ($69 million) is used to provide a $100 increase in per pupil aid in the second year (2016-17.)  This is the good news.

The bad news is that for the first time since revenue limits were implemented in 1993-94, there is no increase in the per pupil amount in either year of the 2015-17 state budget. There is a $0 increase in general aid in the first year and a $108 million increase in the second year; however, because per pupil revenue limits are not adjusted, this increase effectively reduces property taxes rather than increases resources for schools.

The chart below illustrates the recent history of legislative changes in per pupil resources for school districts. It depicts the year by year increases (or decreases) in revenue limits and per pupil aid.  (Click on chart to enlarge.)

Revenue Limit & Per Pupil Aid Adjustments over Time (thru JFC)

With no increase in funding in the first year, coupled with statewide voucher expansion funded in a way that will drain resources from public school districts, many districts will see an actual net reduction in resources under the JFC-approved plan.

Qualifying small and rural districts will see a modest increase in sparsity aid and high-cost  transportation aid

Finally, the proposed increase in the school levy tax credit remains intact.  The JFC budget version approves a $105.6 million overall  bump in property tax credits on tax bills issued in December 2015 and December 2016. This credit is normally paid out by the state on a delayed basis the following July.  The governor had proposed moving up one of the payment dates so it would fall within the second year of the biennium.  The JFC’s action moves this payment back into the next biennium, freeing that amount to be used to provide additional resources for schools without reducing the level of property tax relief the governor had proposed.