Where’s the Innovation in the School Foundation

Formula?

Marsha Tangen, Davenport Chief Financial Officer

Shawn Synder, LSA Division AdministratorJackie Black, IASB Education Finance DirectorGalen Howsare, IASB Chief Financial Officer

July 20, 2011

History/Conversations/Changes Finance Formula History

LSA highlights from 1971-2010

Legislative Resolutions Committee Discussions initiated June 2011

Possible Proposed Changes Looking forward to legislative priorities

How Did We Get Here?

Regular Program District Cost

District Cost Per Pupil – FY 2012 $6,058 – Highest (8 Districts) $5,883 – Lowest (175 Districts) $175 – Range (3.0% difference)

District cost per pupil increases each year by a per pupil amount (allowable growth per pupil)Minimum district cost per pupil=State cost per pupilNote: this is not the case for the State categorical supplement per pupil amounts

Allowable GrowthHistory

Allowable Growth History

Instructional Support Program

Established beginning with the 1991-92 school year

The maximum amount may be ten percent of the regular program cost

Board may adopt for up to 5 years/election held for up to 10 years

Funding by property tax/income surtax plus state aid

Miscellaneous Income – any general fund purpose In Fiscal 2011 – 341 districts participating

Instructional Support Program

Underfunding history/issues

Spending authority

Property Tax Reform Proposal

2011 Legislative ProposalsHSB 240 Property Tax Omnibus Bill HF 697 Omnibus Appropriations BillH 1752 to SF 533 Senate Amendment

Property Tax Reform

Budget Adjustment (Guarantee)

Phase-out began in FY 2005 Scale Down Adjustment –will phase out

by FY 2014 101.0% Adjustment (will remain in

place after phase-out) A factor of enrollment changes and

allowable growth rate

Budget Adjustment FY 2012 Total B.A. $47.715 million (270

districts) Scale Down (20% based on FY 2004

total regular program budget) -$1.117 million (21 districts)

101.0% Adjustment (101% Based on previous year without adjustment - $46.598 million (249 districts)

Budget Adjustment

Finance Formula Areas Other areas of consideration

Adjust Weightings Dropout Prevention Property Tax Relief/Property Tax Equalization Cash reserve levy change 25% to 20% limit Preschool funding Transportation funding

Future direction of discussions

Questions/Discussion

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