The consultants’ final report on education funding, presented to the Commission on Innovation and Excellence in Education earlier this month, includes suggestions for county-by-county funding increases and decreases. 

Meeting and Report Overview

Earlier this month, the State’s consultants presented their final report recommending a $2.9B funding increase to achieve state education standards to the Commission on Innovation and Excellence in Education, also known as the Kirwan Commission.

More than $1B of that funding would come from the local share of education expenses. However, due to the many changes recommended, fourteen counties would see a decrease in their local share of education expenses, while the other ten would see increases.

The $1B increase in funding represents a 19% increase from a current $5.39B local share of K-12 education expenses to $6.43B. Since local boards of education do not have independent authority to raise revenue, county governments would be asked to provide that cost increase. The State, which is only currently providing $4.87B of corresponding costs, would be required to increase its share 39% to $6.78B.

The consultants’ report is a suggestion only. Any ultimate recommendation for funding changes would come from the Kirwan Commission in the fall of 2018. And the report was not embraced with open arms when presented to the Commission, either. Commissioners questioned the consultants’ approach, scope, and conclusions, especially in light of other expert testimony the Commission has heard. Several components of the draft report (at that time) were not analogous to the previous items that had been presented to the stakeholder group.

Video of the meeting is online, and available at the Maryland General Assembly website, under the House Appropriations Committee December 8th. The next meeting of the Commission is scheduled for Monday, January 9th at 1pm in Annapolis. Stay tuned to Conduit Street for more updates.

County-by-County Effects

As the Commission continues broader conversations on education funding and begins to determine whether and how to integrate any of the consultants’ suggestions within its own recommendations, it is worthwhile to review the funding estimates in the report that relate to county governments.

A chart on page 109-110 of the report summarizes state and county-by-county funding changes for education that make up the $1B.

A few factors in the report that contribute to the cost increases listed above include:

• The study team recommends changes to the way that local wealth is calculated. In a system where the state’s education funding aims to equalize wealth across jurisdictions, this alters the distribution of state funding, and in-turn the required local share of education costs. The study team recommends using only November net taxable income data, and multiplying a county’s property wealth by the ratio of the county’s net taxable income to the state average net taxable income. (See report for county-by-county effect)
• The study team recommends eliminating state funding minimums, meaning some jurisdictions would receive no state education aid, and they recommend that all counties should be required to contribute towards special needs, compensatory education, and limited English proficiency programs. (State funding reduction is approximately $427M).
• The study team recommends including 4-year olds in Pre-K in the full time enrollment count. (Approximately a $493M cost).
• The study team recommends replacing the Geographic Cost Index with a three-year rolling average of the Comparable Wage Index, and incorporating that index into the state’s funding formula, resulting in decreases in state funding for regions with lower costs according to the index. (GCEI is currently a state grant. This proposal would share the program costs between the state and the counties.)

With regard to how these changes would affect current maintenance of effort laws, the consultants state:

Under the proposed method of determining state and local shares, the State should also revise its maintenance of effort requirement, which requires each jurisdiction to appropriate the greater of its total foundation local share or its prior year per pupil total local appropriation. Because the proposed total required local share would consist of the foundation, compensatory education, LEP, and special education local shares, the maintenance of effort should be changed to the greater of the proposed total required local share or its prior year per pupil total local appropriation to make it consistent with the changes to the required local share.

Additional suggestions that affect funding include:

• The study team recommends smoothing decreases in state funding to counties with declining student enrollment. (The cost of this, with Pre-K enrollment counts, is about $11M).
• The study team recommends continuing to use Free and Reduced Price Meal (FRPM) eligibility to identify students for compensatory education funding but use an alternative state-developed form for collecting FRPM eligibility information.
• The study team recommends altering the funding weights used to provide additional funding for special needs, limited English proficiency, and compensatory education students.

For more information see the Adequacy Study of Funding for Education in Maryland – Final (December 2016), the Commission on Innovation and Excellence in Education (the Kirwan Commission), and our previous post, K-12 Funding Consultants: Spend $2.6B More, Huge Winners/Losers.