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School Finance: Chapter 70 Program

FY11 Chapter 70 Aid and Net School Spending Requirements

June 30, 2010

On June 30th Governor Patrick signed the FY11 state budget which authorizes $3,850,884,445 in Chapter 70 education aid to Massachusetts school districts. This is a reduction of $18,641,690 or 0.5 percent from the FY10 Chapter 70 appropriation.

As in the past two fiscal years, state fiscal stabilization fund (SFSF) grants help avoid deeper reductions. These grants fall from $172 million in FY10 to $75 million in FY11. The net result in combined Chapter 70 and SFSF funding is a four percent cut for 275 of 328 operating districts, with the combined total falling from $4,041,701,404 to $3,926,155,830, a reduction of $115,545,574 (-2.86%).

The final FY11 aid numbers differ significantly from the preliminary estimates published in January based on the Governor's House 1 level-funded budget proposal . Required contributions also change from the January amounts, falling by $16 million (0.3 %) due primarily to the impact of local aid cuts on municipal revenue growth factors. Enrollment and foundation budgets are the same as those used in January.

Here are highlights of the FY11 Chapter 70 program:

  • All foundation budget rates have been decreased by -2.2%, using the federal government's price deflator index for state and local government expenditures. This is the first time that a negative index has been applied to foundation budgets.

  • Statewide foundation enrollment fell slightly from 940,984 in FY10 to 938,333 in FY11 (-0.3%).

  • Each municipality's target contribution has been updated using 2008 property values and 2007 personal income data.

  • The implementation of the aggregate wealth model for calculating required local contributions continues. When the model was first used in FY07 it was hoped that excess local effort above targets would have been fully reduced in FY11. Unfortunately recent state budget shortfalls have necessitated more moderate phase-in. FY11 requirements are reduced by 30% of the gap (compared to 15% in FY10).

  • The $172,175,259 in SFSF funds from FY10 are added to the base Chapter 70 amount of $3,869,526,145 and then a four percent cut is applied to each district's combined sum.

  • 67 districts receive a total of $48 million to ensure that they do not fall below their foundation budgets.

  • The resulting Chapter 70 amount is then cut by an additional 1.91% and replaced with $75,271,375 in FY11 SFSF grants. Every operating district is eligible for an SFSF grant.

  • Net school spending requirements continue to equal the sum of Chapter 70 aid and required contributions. Although SFSF grants contribute to districts' capacity to fully fund foundation budget levels, the grants are not included in the spending requirement.

The Department of Elementary and Secondary Education has prepared the following materials to assist local officials in understanding the state aid calculations and local contribution requirements in this year's Chapter 70 program:

  • Download PDF Document Download MS EXCEL file  Summary chart showing foundation enrollment, foundation budget, Chapter 70 aid, and required local contributions for each school district.

  • Download PDF Document Download MS EXCEL file  Summary chart for regional school districts, showing foundation enrollment and required local contribution for each member of the district

  • View HTML Page  White paper describing the major components of the formula.

  • Download MS EXCEL file  Complete formula spreadsheet showing the detailed calculations for each municipality and district.

Questions about the Chapter 70 program should be addressed to either:

Roger Hatchrhatch@doe.mass.edu781-338-6527
Jeff Wulfsonjwulfson@doe.mass.edu781-338-6500


Last Updated: June 30, 2010
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