formula funding for fiscal year 2012 and beyond. budget issues – good news fy11 budget includes...
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![Page 1: Formula Funding For Fiscal Year 2012 and beyond. Budget Issues – Good News FY11 Budget includes 2.3% growth in state revenues. As of October 1, year-to-date](https://reader036.vdocument.in/reader036/viewer/2022081519/56649cad5503460f9496f631/html5/thumbnails/1.jpg)
Formula FundingFor Fiscal Year 2012 and beyond
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Budget Issues – Good NewsFY11 Budget includes 2.3%
growth in state revenues.As of October 1, year-to-date
collections are up 2.6 percent compared to 2010.
$189 Million in Federal Jobs money to be run through FY11 supplemental budget process.
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Budget Issues – Bad NewsFoundation formula includes $247
million in Federal Stabilization Funds.Gaming revenues that support the
formula are about $50 million under budget.
Formula requires an additional $233 million to fully fund in FY12 at 86/14.
The state’s total general revenue is about $600 million short for FY12.
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Foundation Formula History
FY07 - $2,748,753,809FY08 - $2,871,673,147 +$122,919,338
FY09 - $2,969,011,969 +$97,338,822
FY10 - $3,004,388,410 +$35,376,441
FY11 - $3,004,388,410 +0
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New Formula Phase-in
SB287 2005-062006-07 (FY07) 15%85%2007-08 (FY08) 30%70%2008-09 (FY09) 44%56%2009-10 (FY10) 58%42%2010-11 (FY11) 72%28%2011-12 (FY12) 86%14%2012-13 (FY13) 100% 0%
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Formula Cost
FY11 (72/28)$3,129,672,170
FY12 (86/14)$3,237,040,673
FY13 (100/0)$3,345,928,000
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Formula UnderfundingWith $3 billion funding appropriation
FY11 $125,283,760 4% reductionFY12 $232,652,263 7-9% reduction**FY12 reduction will increase if appropriation is less than $3 billion.
FY13 $341,539,590 ?????
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FY 11 Foundation FormulaFunding Scenarios
Phase-in Approp. Proration72%/28% 3.004 B 96.0%72%/28% -50 m 94.4%72%/28% -50 m + Fed. Jobs100.4%
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FY 12 Foundation FormulaFunding Scenarios
Phase-in Approp. Proration 86%/14% 3.004 B 92.8%86%/14% -50 m 91.3%86%/14% -100 m 89.7%86%/14% -200 m 86.6%86%/14% -297 m 83.7%
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In FY13 The Rules Change
SB287 includes a provision that comes into play in 2012-13 (FY13) which says, “The state adequacy target may be adjusted to accommodate available appropriations.”
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FY 13 Foundation FormulaFunding Scenarios
Phase-in Approp. Proration SAT100% 3.004 B 89.1% $5,612100% -50 m 87.5% $5,515100% -100 m 85.9% $5,410100% -200 m 82.7% $5,125100% -297 m 79.6% *
*At this point all districts are hold harmless
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IF $3B is appropriated to fund the foundation formula in FY13.
The state adequacy target may be adjusted to accommodate for available appropriations.
The adequacy target is estimated to fall from the current $6,131 to about $5,600.
About 100 more school districts will become hold harmless.
Hold harmless school districts would receive 100% of their hold harmless amount.
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FY13 School Funding ChaosIf get to FY13 and the state
adequacy target is adjusted to $5,600 or below, there will be a MASSIVE shift of funds from formula districts to hold harmless districts creating financial chaos among Missouri’s public schools.
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Is There A Solution?Executive Committee requested
a study of possible solutions.
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Formula Funding Proposal
1. Proposal only works if there is $3 billion appropriated and distributed to schools in FY12 and the amount is increased in FY13 and FY14.
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Formula Funding Proposal
2. Freeze the funding percentages at 72%/28% for FY12 and FY13. In the following years, increase the percentages by 7% each year on the SB287 formula until the percentage reaches 100% in FY17.
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Formula Funding Proposal
3. Reduce the reduction for all school districts before the funding percentages on the SB287 formula move higher.
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Formula Funding Proposal
4. Funding percentages can never go below 72/28. If available appropriations fall below what is needed to fund a 72/28 formula, then all school districts, formula and hold harmless take a percentage reduction.
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Formula Funding Proposal
5. The future funding percentages are only targets. If the appropriation is insufficient to meet the targeted percentages, the phase-in percentages would be adjusted. If more money is available than needed, the percentages would be increased.
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Potential Issues
Can the state appropriate $3 billion for the formula in FY 12 and additional money in FY13 and FY14?
Will all school districts agree to a solution?
Who is going to carry the legislation?What amendments will be added
during legislative process?
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Coming together is a beginning.Keeping together is progress.Working together is success.
-Henry Ford
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Questions and Comments?