bep formula overviewbep formula overview bep review committeebep review committee august 13,...

BEP Formula Overview

BEP Review CommitteeAugust 13, 2013

BEP Review Committee August 13, 2013 2

BEP Formula

BEP Review Committee August 13, 2013 3

Basic Education Program (BEP)

Adopted by State Legislature in 1992 as part of the Education Improvement Act (EIA)

In response to small systems lawsuit that claimed former funding formula was inequitable

BEP 2.0 approved in 2007

Determines the funding level required for each school system to provide a common, basic level of service for all students

BEP Review Committee August 13, 2013 4

Basic Education Program (BEP)

Funding formula, NOT a spending plan

Provides flexibility

Attempts to keep up with increased costs

Formula contains a number of components (45 total) that the Legislature has deemed necessary for schools to succeed

BEP Review Committee August 13, 2013 5

Basic Education Program (BEP)

Instructional• Regular Education• Vocational Education• Special Education• Elementary & Secondary Guidance• Elementary Art, Music and Physical Education• Elementary & Secondary Librarians• ELL Instructors and Translators• Principals• Elementary and Secondary Assistant Principals• System-wide Supervisors (Regular, Special & Vocational Education)• Special Education Assessment Personnel• Social Workers & Psychologists• Staff Benefits & Insurance

BEP Review Committee August 13, 2013 6

Basic Education Program (BEP)

Classroom• K-12 At-risk Class Size Reduction• Duty-free Lunch• Textbooks• Classroom Materials & Supplies• Instructional Equipment• Classroom Related Travel• Vocational Center Transportation• Technology• Nurses• Assistants (Instructional, Special Education & Library)• Staff Benefits & Insurance• Substitute Teachers• Alternative Schools• Exit Exams

BEP Review Committee August 13, 2013 7

Basic Education Program (BEP)

Non-classroom• Superintendent• System Secretarial Support• Technology Coordinators• School Secretaries• Maintenance & Operations• Custodians• Non-instructional Equipment• Pupil Transportation• Staff Benefits & Insurance• Capital Outlay

BEP Review Committee August 13, 2013 8

Basic Education Program (BEP)

BEP Review Committee August 13, 2013 9

Basic Education Program (BEP)

Two Separate Parts:• Funding – Department of Education

determines need.

• Local Ability to Pay or Fiscal Capacity– Fiscal Capacity Indices provided by:»Tennessee Advisory Commission on

Intergovernmental Relations (TACIR)»UT Center for Business and Economic

Research (CBER)

BEP Review Committee August 13, 2013 10

Basic Education Program (BEP)

ADMs (average daily membership) drive the Formula – funded on prior year’s ADMs.

ADMs generate:• Positions – teachers, supervisors, assistants• Funding dollars – ADMs are multiplied by a Unit Cost for

supplies, equipment, textbooks, travel, capital outlay, etc.

Funding months and weighting• Month 2 – 12.5% Month 6 – 35%• Month 3 – 17.5% Month 7 – 35%

BEP Review Committee August 13, 2013 11

Basic Education Program (BEP)

Unit Costs Equipment, supplies, travel, substitute teachers

• 3 year average• Average is inflated up two years

Textbooks• 3 year average• Average is inflated up one year

Alternative Schools, Duty Free Lunch, Maintenance & Operations• Prior year value is inflated up one year

Capital Outlay• Square footage cost obtained from RS Means publication• Formula – each ADM generates square footage, multiplied by a cost, then

amortized to arrive at a yearly cost• Includes architect fees and equipment

BEP Review Committee August 13, 2013 12

Basic Education Program (BEP)

Cost Differential Factor (CDF)

• Adjusts BEP funding in LEAs where the cost of living in the county is greater than the statewide average

• Compares county wages in non-government industries to statewide wages

• Increase applied to salaries, retirement and FICA contributions

• Currently 50% of the CDF is applied in the formula

BEP Review Committee August 13, 2013 13

Basic Education Program (BEP)

Fiscal Capacity

• TACIR Model (complex multiple-regression model)

• CBER Model– Based on property and sales tax bases– Model in BEP 2.0

Currently a TACIR/CBER mix is used in BEP calculation (50%/50%)

BEP Review Committee August 13, 2013 14

Basic Education Program (BEP)

Tennessee Basic Education Program: An Analysis• http://www.comptroller1.state.tn.us/orea/• See legislative brief

State Board of Education• http://www.tn.gov/sbe/bep.html• BEP Handbook – detailed explanation of

calculation• BEP Blue Book – up to date data on BEP

components• Recommendations of BEP Review Committee

BEP Review Committee August 13, 2013 15

Questions?