School Finance and District Support

FY15 Update on State Aid Programs for Elementary and Secondary Education

July 14, 2014 The Governor signed the fiscal year 2015 budget on July 11. Here is a summary of the major provisions relating to state aid for elementary and secondary education.

Chapter 70

The Chapter 70 program has been funded at $4,400,696,186, an increase of approximately $99.5 million over FY14. This increase ensures that all districts will continue to be at or above their foundation budgets. It also includes "downpayment" aid to bring districts up closer to their aid targets, and guarantees an increase of no less than $25 per pupil. Outside Section 262 also puts in place a four-year phase-in regarding the inclusion of retired teachers health insurance. 127 districts cannot count that function in their net school spending. The section allows districts to vote to begin including 25 percent of this cost in FY16, with annual increments in the percentage until 100 percent is reached in FY19. Outside section 124 establishes a legislative commission to review the Chapter 70 foundation budget and consider models of efficient and effective resource allocation. Its report will be due in June 2015.

Special education circuit breaker

The circuit breaker program has been funded at $257,513,275, an increase of $5 million from last year's funding. Claim forms for FY14 expenses were due July 7th. Claims will be reviewed as they are received, and initial payments will be made this fall. We expect the reimbursement rate for the initial payments this year will be between 71 and 73 percent. We plan to post reimbursement information by mid-September. After we have posted the reimbursement information, we will announce the districts that will be audited this year as required by statute. In addition to the reimbursement of FY14 expenses, $5 million will be available for payments to districts experiencing extraordinary increases in their eligible FY15 expenses. Instructions and application forms for extraordinary relief will be distributed in February 2015.

Charter school tuition reimbursement

The appropriation for charter school tuition reimbursement was funded at $80,000,000. Sending districts will receive 100% reimbursement for the facilities component of their charter tuition costs. The current appropriation falls short of the entitlement for the transitional reimbursements (the so-called "100/25/25/25/25/25" aid) and those amounts reflect a proration of 60 percent. The way the pro-ration is implemented is also changed, to fully fund as much of the first year 100 percent calculations as possible. Projected district-by-district calculations have been posted on the ESE website. Please remember that charter tuition costs and reimbursements will change throughout the year as enrollment and tuition rates are finalized.

Regional and vocational transportation

Funding for regional school transportation funding was increased to $70,251,563, a $18.7m increase over FY14 and non-resident vocational transportation was decreased to $2,244,847 from $3,000,000 last year. Payments will be made to districts based on reported expenses on the FY14 end of year financial returns. Final reimbursement percentages in FY14 were 66.4 percent for regional transportation and 86.9 percent for vocational transportation. Reimbursements for regional transportation in FY15 will likely be between 86 percent and 88 percent, while the reimbursement percentage for non-resident vocational transportation will decrease to approximately 59 percent. Final percentages will be calculated after we have received and processed all districts' end of year returns.

Homeless Transportation

The appropriation for homeless transportation reimbursement was level funded at $7,350,000. Payments will be made to districts based on reported expenses on the FY14 end of year financial returns. The final reimbursement percentage in FY14 was 50.8 percent for homeless transportation. The FY15 line item funding will enable us to reimburse districts between 46-48 percent.

Last Updated: July 14, 2014