State could fail to reach the foundation funding level for education for the second year in a row

By Jamey Dunn

Under the current budget, schools will miss a general state aid payment in June. Under Gov. Pat Quinn’s budget for next year, they can expect a similar outcome.

General state aid for education in the Fiscal Year 2012 budget fell 5 percent short of covering the foundation level of $6,119 per student paid to many schools. Lawmakers chose to hold off the reduction so it would kick in at the end of the current fiscal year.

State Superintendent Christopher Koch says that means most school districts will see a reduction in their first June payment, and no schools will get a second payment in June. But Koch said that districts should not be caught by surprise when the check doesn’t come. “The have known it for a long time. In fact, districts requested that we hold it off until the last month,” Koch said. “They’re trying to get through the school year as much as possible on what they can, and then they’re going to shoulder June’s payments to be less. But they’re quite aware of it.”

Overall, payments for general state aid, which is the largest area of state education spending, are being sent out on time. “They’ve been on time consistently, which is really good. Even through the worst of the recession, we’ve kept those payments coming. Now other payments, that’s not the case.” Payments for mandated categorical grants, for such programs as special education and student transportation -- which are the second largest area of state funding for education -- are lagging behind. “Those have gotten a little better though, and we’re not as far back as we were a year ago. I look at incremental progress, but we’re still not in great shape,” Koch said. Some mandated categorical payments are only caught up through the first quarter of the current fiscal year, which ends June 30.

Quinn is proposing to hold general state aid flat next fiscal year. Koch said the state would not be able to maintain the foundation level of $6,119 per student under the governor’s budget. Koch said that instead of simply reducing the level, lawmakers chose to take an action the state board is describing at prorating general state aid. So the foundation level did not change, but the actual payments were cut. That way wealthier schools, who receive a flat grant, would also see their aid cut. “It’s a fairness issue of everyone taking a hit versus just districts that are under general state aid taking the hit.” Under Quinn’s proposal general state aid would fall 8 percent short of meeting the foundation level.

 Koch said that the recession has put a squeeze on state dollars because local districts have less money, so that state must pay more to maintain the funding levels determined by the general state aid formula. The state board is asking for an additional $201 million above Quinn’s proposed spending level for general state aid. Under the board’s proposal, general state aid payments would fall 4 percent short of the foundation level. “Asking for an increase in this climate is not an easy thing to do, but it takes a lot of money in the GSA formula to make it work. It’s working. It’s compensating for the increased poverty and the property values [that] have not rebounded yet in this state, the home values for example. So when those do, it will take less money. But right now, the recession has been hard on the formula.” Koch said it would take about $400 million more than Quinn’s proposed spending to fully fund the foundation level.

Rep. Daniel Biss, an Evanston Democrat, said that instead of using complicated accounting tactics to make sure that cuts are spread out evenly among the spectrum of wealthy to impoverished school districts, the state should rethink the formula it uses to determine funding. “This is just the latest in a long series of very clear evidence that we, the General Assembly, ought to look under the hood of the funding formula a lot more comprehensively,” Biss said. Koch said in response that he would support a funding plan where money follows children in the system.

The state board also asked for additional dollars, $64 million total, for programs such as advanced placement classes and bilingual education. State Rep. Roger Eddy, a Hutsonville Republican, questioned proposed spending in other areas if the state cannot afford to make its general state aid payments. “The documents I’ve read from the State Board of Education in the past … in order of priorities the general state aid foundation level is number one,” says Eddy, who is also a Hutsonville superintendent. “I’m tying to figure out how, if that is the priority [and] we have available funds, why is it not going into that if it’s not funded at the level promised?”

Koch said the increases the board is asking for outside of general state aid are needed to implement programs that are mandated by law, including the recent education reforms approved by the General Assembly. “There’s other mandates. The General Assembly passed additional requirements for preschool bilingual programs. Well, that’s a lot more kids,” he said. “We are not asking for anything that is not a requirement. There’s not fluff in our budget. Everything there has a statute in behind it or some requirement on schools districts or on us to deliver on. We’ve been prioritizing among priorities for a long time now.”

UPDATE:  Quinn said he is looking for ways get schools their full general state aid payments in June. “I’m not giving up on that,” Quinn told reporters at a news conference in Berwyn.

He said sales tax revenues are better than expected this year, and some of that money could help stave off cuts. “We’ve got some revenue that we were happy to get because our sales tax this year, this fiscal year, performed better than expected,” Quinn said. “It seems to me we ought to take a look at investing that money in learning and education this fiscal year and definitely next fiscal year.”