Gov's Budget Proposal Calls for Variety of Per Pupil Increases

Bob Kefgen's picture

Governor Snyder has rolled out his final Executive Budget Recommendation…and it's a doozy. Fortunately, the major provisions are few and straightforward, making this budget pretty easy to explain and grasp. And for most Principals, this budget is good news: a big foundation increase, additional targeted adjustments for high school and CTE students, and continued funding for things like At Risk. But the Governor proposes paying for some of the new spending with targeted cuts, specifically a cap on shared time and a reduction in cyber school foundation allowances…two items that will be deal breakers for some districts.

Let's go to the film…

Foundation Allowance

  • The Governor is proposing a foundation increase of $120-240 per pupil using the 2X formula, which – if it passed – would make it the biggest increase foundation increase since 2002. Under his proposal the minimum foundation would be raised to $7,871 and the maximum foundation would jump to $8,409. For those keeping track, this would reduce the gap between minimum and maximum foundation districts to $538/pupil, the smallest it has ever been.
  • An additional $25 per pupil for students in 9-12 grade. This is a continuation of current year practice and recognizes (as the Governor's budget proposal says) "the higher curriculum costs of high school." These dollars come without any additional strings attached, which is both good and bad from a secondary Principal perspective. On the downside, there is no requirement that the extra money be spent at the high school level, but on the upside, schools are not required to jump through any hoops to qualify for the money and there are no limits on how it can be spent…it is just like the foundation allowance.
  • A new $25 per pupil increase for CTE students in recognition of the increased cost for offering those programs. Like the additional money for high school students, the money comes with no strings attached. Any student who is enrolled in at least one CTE program qualifies for the additional funding.
  • An additional $25 per pupil for CTE students enrolled in certain programs, specifically those that "provide instruction in critical skills and high-demand career fields." The supporting documents from the Governor's office estimate that approximately 72,000 of the 109,000 students currently enrolled in CTE fall into one of these categories. The budget identifies those categories by CIP code and the list is as follows:
    • Agriculture, Agriculture Operations, and Related Sciences
    • Natural Resources and Conservation
    • Communications Technologies/Technicians and Support Services o Computer and Information Sciences and Support Services
    • Engineering
    • Engineering Technologies and Engineering-Related Fields
    • Biological and Biomedical Sciences
    • Construction Trades
    • Mechanic and Repair Technologies/Technicians
    • Precision Production
    • Health Professions and Related Programs

Other Issues

  • At Risk
    The budget continues funding At Risk at the current year level of $499 million. It is unclear how much this will translate into on a per pupil basis, but we do know that language added last year to expand the pool of eligible student is maintained in this proposal. However, a good deal of new language has been added in what appears to be an attempt to create an academic early warning system. The implications of this new language are – as yet – unclear.
  • MPSERS Offset
    Continues a $100 million allocation that offsets MPSERS costs for districts based on their percentage of the statewide payroll. While it is a rough approximation and varies by district, an easy way to contextualize this funding is that it equates to a little over a 1% reduction in the MPSERS rate paid by districts.
  • Shared Time Cap
    In order to fund some of the new spending, the budget proposes capping shared time at no more than five percent of a district's total FTEs. According to a summary provided by the state budget office, this cap would have impacted only 24 school districts in the current school year, but would save the state an estimated $68 million. However, the result is a potentially devastating cut to those district with a large percentage of shared time students.
  • Cyber School Foundation Cut
    The other cut being proposed is a reduction in the foundation allowance paid to cyber schools. Under the bill, cyber schools would receive 75% of the state's minimum foundation allowance, or $6,586.

What's Next?

It is important to remember that this only the first step in a lengthy budget process. The House and Senate budget subcommittees will now begin the process of working on their budget recommendations, which are traditionally finished by late March or early April, roughly concurrent with the legislative spring break. The months of April and May will be spent hashing out the differences between the various proposals and a final 2018-2019 budget agreement should be finalized by the beginning of June.

Resources

As you might expect with a state budget, there is plenty of detail available for those Principals with a twisted desire to dig into the details of the Governor's proposal. The best compendium of available resources is maintained and regularly updated by the Michigan School Business Officials and includes all the relevant budget documents, bills, summaries, and policy and fiscal analyses.