House Subcommittee Budget Reported

Bob Kefgen's picture

On Tuesday afternoon, the House K-12 budget subcommittee reported out its version of the K-12 budget for 2018-19. Like the Governor and the Senate, the House included a sizable foundation increase on the 2X formula, some new funding for CTE and the $25 per pupil bonus for high school students that first appeared in last year's budget. Like the Senate, the House also restored the cuts proposed by Governor Snyder to shared time and cyber schools. The House also included the Governor's Marshall Plan for Talent proposal as part of their recommendation, something that the Senate plans to do as a separate bill.

Side-by-Side

Here's a side-by-side breakdown of the major provisions of the House, Senate, and Executive budget recommendations:

Item Executive Senate House
Foundation Allowance $120-240/pupil allocated on 2X formula

  • Minimum foundation: $7,871
  • Maximum foundation: $8,409
  • Gap: $538
$115-230/pupil allocated on 2X formula

  • Minimum foundation: $7,861
  • Maximum foundation: $8,404
  • Gap: $543
$120-240/pupil allocated on 2X formula

  • Minimum foundation: $7,871
  • Maximum foundation: $8,409
  • Gap: $538
High School Foundation Increase $25/pupil foundation increase for students in 9-12 grade. This is a continuation of current practice. $25/pupil foundation increase for students in 9-12 grade. This is a continuation of current practice. $25/pupil foundation increase for students in 9-12 grade. This is a continuation of current practice.
CTE Incentive Payments Up to $50/pupil foundation increase for student enrolled in CTE programs.

  • $25/pupil for all CTE pupils
  • Additional $25/pupil for CTE pupils studying high-demand fields
Allocates the same total amount of money ($5 million), but distributes it equally in grants to each career education planning district (CEPD) that is located in an ISD that does NOT levy a CTE millage. At least 50% of the funds must be used for equipment purchases. Allocates the same total amount of money ($5 million), but distributes it through the existing Added Cost formula (sec. 61a).
Shared Time Cap Capped the amount of shared time FTEs a district could collect at no more than five percent of a district's total FTEs. Reduces the existing per pupil FTE cap for shared time pupils from .75 FTEs per pupil to .67 FTEs per pupil. Retains current law.
Cyber School Foundation Cut Caps the foundation allowance paid to cyber schools at 75% of the state's minimum foundation allowance, or $6,586. Not included. Not included.
Partnership Districts Appropriated $8 million to support the MDE's Partnership Model as outlined in the state's ESSA plan. Creates a new Partnership District accountability system that would tie a portion of the foundation allowance for Partnership Districts to meeting new requirements. Specifically, these districts would have to amend their partnership agreements to include:

  • Measurable academic goals, including a mandatory goal that all students be on track to achieve proficiency within 36 months.
  • Accountability measures, which must include either school closure or reconstitution if a partnership district does not meet their goals. The language also stipulates a detailed process for reconstitution including (among other things) replacing the elected school board and cancelling collective bargaining agreements
Appropriated $6 million to support the MDE's Partnership Model as outlined in the state's ESSA plan.

At Risk and Marshall Plan

There are two other noteworthy budget battles ongoing that don't fit nearly in the table above: At Risk and the Marshall Plan for Talent.

The biggest of these is a debate about what requirements will be attached to At Risk funding (sec. 31a). The strings tied to the funding districts receive through this section amounts to yet another layer of state accountability and one that has changed a handful of times in the past several years. As part of his budget proposal, the Governor proposed yet another overhaul. The Senate maintained existing language. And the House effectively split the difference, accepting some, but not all of the Governor's changes. Bottom line: while it means moving the target yet again, a change in language seems likely since it may not be realistic to hit the target where it is.

The other is Governor Snyder's proposed Marshall Plan for Talent. The House only includes about half of the Governor's proposal, changes some elements and uses a big chunk of the Marshall Plan funding to displace existing School Aid spending. Among those items on the chopping block are several proposals that had the greatest support from educators: universal access to career cruising software, state-funded career navigators, and incentive payments to educators who obtain certification in a critical shortage area. The Senate did not take any action yet on the Marshall Plan.

Notes and Next Steps

Like the Senate's budget, the cost for the House proposal is approximately $100 million higher than the Executive Recommendation. Unlike the Senate, which makes up the difference primarily by allocating additional general fund dollars, the House uses School Aid revenue to close the gap. This could work if revenue estimates increase beyond what was projected at the January Consensus Revenue Estimating Conference. But if revenues come up short, the House and Senate would both be significantly over budget.

Today's budget recommendation now goes to the House Appropriations Committee and then the House floor. The recommendation can be amended at both stages, so further changes are possible.

Over the two months between now and when the 2018-19 budget is expected to be finalized, the budget bills from both chambers will go through the formal process of moving out of committee, through the full House and Senate, and into conference committee where the compromise version of the budget will eventually be voted on. All the while, the budget chairs from the House and Senate will negotiating with each other and the Governor's staff behind closed doors hammering out the fine details of that compromise. The whole process should wrap up by the last week of May or the first week of June.

Resources

For anyone who wants to dig deeper into the details, 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.