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School funding change on the move in the Legislature

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Between the fall of 2019 and fall 2020, 59 public school systems’ enrollment grew by nearly 6,500 students.

But under the state’s current funding structure, systems have to fund most of that growth, including hiring the needed teachers, out of their local tax revenue and state funding is slow to catch up, if it ever does, educators say. For some of the systems with the largest growth, that’s hundreds of students and millions of dollars.

Senate Bill 9 would amend the state's Foundation Program to calculate growth so systems don’t have to wait a year for per-student funding, which this year is about $6,271. It would estimate non-virtual enrollment based on the previous years’ growth. Virtual students are also included in schools' average daily membership and growth in virtual students will be funded at a rate determined by the State Department of Education.

“This legislation will provide front-end funding for these students so that they receive funding in year one,” said bill sponsor Sen. Chris Elliott, R-Daphne. “The Foundation Program utilizes prior year enrollment to calculate appropriations each fiscal year,

“Historically, fast growing school districts have received little to no funding for these new students.”

The Alabama State Department of Education worked with Elliott on the legislation.

Deputy State Superintendent Andy Craig said the existing mechanism for funding growth in a budget year is “current units.”

“It’s kind of been guesswork in terms of how much it would take to do it from year to year, so it goes partially funded or has gone partially funded for a long period of time,” Craig said.

Elliott’s bill puts a growth formula into the state’s Foundation Program, which funds schools’ basic functions.

Craig said the legislation will benefit all systems that are gaining students, not just the largest in the state.

“There’s a shortfall historically, for any system if they grew that year, it’s always been partially funded,” he said.

Russellville City Schools added about 78 students between 2019 and 2020 enrollment counts.

“It is very difficult, when we get an influx of students, especially more than 20 students, that’s a whole other class,” Superintendent Heath Grimes told Alabama Daily News. “If you get 60 more students and you don’t have the state funding, that’s three teacher units that you’re having to fund locally,” Grimes said. “So, anything that funds an increase upfront on projected units I think would be beneficial for systems, for sure.”

Systems’ local funding, based on local tax revenues vary significantly across the state. If it doesn’t have to be used to fund teachers and other essentials of education, it could be used on extracurriculars or other classroom enhancements.

Elliott’s bill does not impact the funding of systems with declining enrollments.

Sen. Donnie Chesteen, R-Geneva, said on the Senate floor Thursday that lawmakers for several years have been trying to address funding of growth, but equity had been a concern.

“What you’ve been able to do here is take care of the growing systems … without causing undue harm to the systems that are flat or not growing,” Chesteen said.

It was approved in the Senate last week on a 29-to-0 vote. It now goes to the House Ways and Means Education Committee.

Separately, school leaders have asked for special consideration in the 2022 budget to not penalize systems who lost enrollment in 2020, possibly because of COVID-19. Last month, State Superintendent Eric Mackey told lawmakers public schools saw a total decrease in enrollment of about 9,700 students this year.

Gov. Kay Ivey’s 2022 education budget includes a one-time $95 million to replace the funding in the Foundation Program that schools would have lost because of enrollment declines, Finance Director Kelly Butler said last week.

Part of the concern is that less funding would cause systems to have to layoff teachers, but students who stayed home in 2020 could come back to class in fall of 2021, crowding classrooms. Lawmakers seem supportive of the one-time funding.

“This especially is not a year we want any school districts handing out pink slips,” said Rep. Terri Collins, R-Decatur. She’s the House Education Policy chairwoman and on the education budget committee. She said she’s working on the resolution thanking teachers for their work and flexibility during the pandemic that moved much of their work out of the classroom and put it online.

“We appreciate everything they’ve done, just rolling with the flow, in the last year,” Collins said.