Building a School Funding Formula to Increase Student Achievement

1. Building a School Funding Formula to Increase Student Achievement Governor Rendell’s Education Budget Education Policy & Leadership Center March 13, 2008

2. Only one thing counts: A quality education for every child • Nearly one-third of Pennsylvania students are still below grade level • 576,000 more students need to reach proficiency by 2014 • Even in our most successful schools, an average of nearly 1 in 6 students are below grade level

3. Governor Rendell’s school funding formula meets 3 key goals • Makes progress towards adequate resources in each school district based on student achievement needs • Provides taxpayers with assurance that new resources are being invested to increase educational services to students • Will be implemented in a manner that is sustainable and responsible

4. Three steps to a new school funding formula • Step 1: Create an adequacy target for every school district • Step 2: Calculate the state’s share of each school district’s adequacy gap • Step 3: Ensure that new resources mean more services for students

5. Step 1: Calculate the adequacy target for every school district • In July 2006, the General Assembly passed bipartisan legislation calling for Pennsylvania’s first-ever Costing-Out Report to determine the level of resources needed to help students succeed • The General Assembly’s report was released by the State Board of Education in November 2007

6. Step 1: Calculate the adequacy target for every school district • The adequacy target in Governor Rendell’s formula is the result of the Costing-Out Report: • Uses the most recent enrollment data • Base funding for every student • A higher target to meet the needs of students who are low-income and English language learners • A higher target for small and mid-sized districts • Adjustments for regional cost of living

7. Step 2: Calculate the state share of each school district’s adequacy gap • The “adequacy gap” is each district’s adequacy target minus its actual spending • 465 school districts have an adequacy gap • The largest adequacy gap is in the Reading School District ($6,033 per student)

8. Step 2: Calculate the state share of each school district’s adequacy gap • Our goal: provide the most resources to the communities that are already working hardest to fund their schools despite limited local resources • The “state funding target” is each district’s Adequacy gap • The aid ratio (measuring local wealth) • A tax effort index

9. Step 2: Calculate the state share of each school district’s adequacy gap • The total state share of the adequacy gap is $2 billion • Governor Rendell’s 6-year plan for meeting our state commitment anticipates a total investment of $2.6 billion to reflect inflation and changing enrollment patterns • The Governor’s 2008-09 education budget provides $291.3 million, a nearly 6% basic education increase, as the first step

10. The new formula in action:District examples • Rural communities • Urban districts • Older suburbs • Growing school districts

11. The new formula in action:District examples

12. The new formula in action: A permanent “growth supplement”

13. Step 3: Ensure that new resources mean more services for students • Why do we need new funding? In order to boost student achievement • School districts will have local control over the best ways to invest new resources in proven academic programs

14. Step 3: Ensure that new resources mean more services for students • Any increase up to the Act 1 inflation index can be used for regular operating costs • Any amount above inflation must be used for: • Academically challenged school districts will require state approval for their investment plans • At least 80% • More classroom time, such as tutoring or longer school days or years • Teacher training • New and more rigorous courses • Class size reduction • Early childhood education • Recruiting effective teachers and principals • Performance contracts for superintendents and principals • Up to 10% • Other strategies to increase achievement • One-time operational cost • Up to 10% • Maintain existing programs that meet the stated goals • One time operational cost

15. We are solving the school funding challenge AND delivering tax relief • Total of more than $1 billion in new school funding and tax relief in 2008-09

16. Demand a new school funding formula this year • Pennsylvania has been without a real school funding formula for more than 15 years • We are running out of time for Pennsylvania’s students • The only way to ensure a long-term school funding solution is to start now and commit in law to a 6-year plan