School Finance:

1
School Finance
A Framework
2
Funding

• Where does most of a schools funding come from?
• Bonds
• Grants
• State aid
• fundraising

3
C. state aid formula
4
Schools Funding

• So what drives state aid funding?
• Property taxes
• Attendance
• Tax rates
• Test scores

5
A. Attendance
OR..
6
Butts in the seat!
7
Can you name any other major funding sources for
schools?
8

• Classroom Site Fund
• Instructional Improvement Fund
• Vocational Educational State Fund
• Federal programs
• Bonds/Overrides
• Grants

Did you guess any? ?
9
Classroom Site Fund and Instructional Improvement
Fund

• CSF

• IIF

• Prop 301 -FY2002
• From state sales taxes
• Additional funds to formula funds
• 20 to be used for base salary
• 40 to be used for performance pay
• 40 to be used for others related to classroom
  expenditures such as classroom size reductions
  and teacher development.

• Prop 202 -FY2002
• Contributions by the gaming tribes to the
  Instructional Improvement Funds
• 50 to be used for classroom size reduction and
  teacher compensation
• 50 to be used for Dropout Prevention and
  development minimum reading skills for students
  by the end of third grade level

10

• Where does Arizona rank in the nation in per
  pupil funding?
• 10th
• 26th
• 49th
• 51st

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C. 49th
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The sources of the formula funding

• State aid from the general funds
• Local tax levies (Districts only)

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What is the process for a districts budget?
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Timeline for a districts budget process 1.
Districts establish a budget for the following
fiscal year. (typically have a budget
committee) 2. Districts hold a public meeting to
discuss the budget. 3. By July 15 of the fiscal
year the district propose a budget to their
governing board. 4. The governing board of a
district approves the budget this budget becomes
an adopted budget. 5. The district submits the
adopted budget to the Department of Education. 6.
The adopted budget determines districts and
charters expenditure authority for the fiscal
year that starts July 1st and ends June 30th.
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The Equalization Concept
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Components of the Equalization Formula

• Districts

• Charters

• Base support level
• Transportation support level
• Soft capital
• Unrestricted capital outlay

• Base support level
• Additional assistance

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Components of the Equalization Formula

• Districts

• Charters

• Base support level
• Transportation support level
• Soft capital
• Unrestricted capital outlay

• Base support level
• Additional assistance

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Base Level Support per pupil spending
Maintenance Operations (MO)
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Base Support Level
Student ADM weights Add on weight for
SPED/ELL students Base Level support
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What was the Base Level Support amount for
FY2011? A. 1,927.44 B. 3,267.72 C. 9,221.68 D.
15,785.12
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B. 3,267.72
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Components of the Equalization Formula

• Districts

• Charters

• Base support level
• Transportation support level
• Soft capital
• Unrestricted capital outlay

• Base support level
• Additional assistance

23
Transportation Support Level Components
24
Components of the Equalization Formula

• Districts

• Charters

• Base support level
• Transportation support level
• Soft capital
• Unrestricted capital outlay

• Base support level
• Additional assistance

25
Soft Capital Components
26
Components of the Equalization Formula

• Districts

• Charters

• Base support level
• Transportation support level
• Soft capital
• Unrestricted capital outlay

• Base support level
• Additional assistance

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Unrestricted Capital
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Basic State Aid

• Base level support
• transportation support
• soft capital
• unrestricted capital
• Local property taxes
• Equalization Formula

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Charter Schools Formula
True or False Charter schools can levy taxes.
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Charter Schools Formula
FALSE! Charter schools cant levy taxes
Base Support Level Additional Assistance
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Can you name any other funds available to
Districts but not to Charters?
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Overrides Monies to construct schools Career
Ladder program Teacher Compensation
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FY2009 Per ADM Average Funding
Average Local State Federal Total
Statewide 3,816 4,404 1,069 9,289
Districts 4,162 4,149 1,113 9,424
Charters 521 6,830 648 7,999
Difference (district. vs. Charters) 3,641 (2,681) 465 1,425
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Charters Vs. Districts
Districts have what percentage of the
students enrolled statewide?
35
91
36
Charters Vs. Districts
What percentage of special education students are
enrolled in school districts?
37
90
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FY 2011 K-12 Funding
What percentage of the state general funds is
spent on K-12 education?
39
41
State general funds expended on K-12 Education
(about 3.5 billion)
40
FY2011 K-12 Appropriations
41
Additionally About 3 billion in local funds
(includes Local taxes, donations and bonds).
About 1.1 billion in federal funds. About
210 million in Federal Edu. Job Fund. About
240 million in Classroom Site Fund. About 38
million in Instructional Improvement Fund. About
11 million in state block grant for Vocational
Education.
42
Can you think of any education issues that also
affect funding?
43

• State Budget Deficits
• Move-On When Ready Concept
• Changes in ADM calculations as base for Funding
• Arizona Online Instruction

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Assessment Activity

• State aid
• ADM
• 49th
• Budget process
• Equalization formula
• Base level support
• Transportation
• Soft and unrestricted capital
• Weighting
• Charter schools
• 41