Oxford Foundation Drops School Aid Rewrite Draft

The Oxford Foundation has released its first draft of a new school finance bill designed to replace the existing School Aid Act. The new piece of legislation, the Michigan Public Education Finance Act, calls for sweeping changes to pupil accounting methods, school funding—including a performance funding component—and individual district responsibilities. Perhaps as important are the issues left unanswered such as how the Oxford Foundation intends to pay for its new proposals, what student growth measurement districts must use, or how districts will be held accountable for student performance on state assessments.

An outline of the proposed changes follows:

School Funding Changes

• The bill creates a public school voucher system in which students may use their foundation allowance to purchase the components of their education a la carte from one or more providers.
• Districts' state aid payments are paid based on student enrollment in individual courses, a prior year pupil count, and a performance funding component as follows:
  • 85% of state aid based on average daily enrollment (calculated monthly),
  • 10% of state aid based on previous year spring pupil count, and
  • 5% of state aid based on the proportion of students who achieve one year of growth for one year of school.

Student Enrollment Changes

• Students may enroll in individual courses in any public school district in the state that will accept them.
  • The student or parent selects one of these districts to act as their primary district (called an enrollment district).
  • The enrollment district is responsible for record maintenance, counseling, accepting credits, awarding diplomas, and other services.
• Districts must continue to accept resident pupils, but may choose whether to accept non-resident pupils and to what extent they will open their doors (for one course, for a certain number of Schools of Choice students, etc.).

Other Changes

• The state would begin paying performance funding in 2014-15 based on the results of a growth assessment to be determined by the Michigan Council on Educator Effectiveness (MCEE).
• The bill establishes a pay-for-performance system for online education in which 50% of the amount paid to online providers is based on the student's level of content mastery.
• Students would be eligible for a scholarship if they graduated high school early. They could receive $2500 per semester that they finished early (up to a maximum of $10,000).
• Schools would be eligible for an undefined per pupil incentive payment for transitioning to a year around calendar.

The proposal is completely silent on the question of district accountability for student performance beyond the proposed performance-funding component. It does not address how the new system would work with Michigan's school ranking system or which districts would be held accountable for a student's performance on state assessments such as the MME. To the contrary, the proposal refers to these accountability systems as "data and record keeping requirements" that may "undermine a new approach."

The proposal not expected to see extensive legislative debate until next year during budget negotiations. In the meantime, the debate will focus on other bills with which this proposal is interlinked—the EAA legislation (HB 6004/SB 1358) and the New Forms of Schools bill (HB 5923)—which are being considered during the lame duck session. A summary of these interconnected proposals and how they relate is available by clicking here.