Senate Passes Bill Containing Basic Education Funding Commission Recommended Fair Funding Formula

HARRISBURG (April 13, 2016) –The Senate today passed a bill that contains a data-driven fair funding formula to distribute more than $200 million in additional dollars for basic education and $335 million in reimbursements to school districts for construction costs owed by the Commonwealth – also referred to as Planning and Construction Workbook (PLANCON), according to Senate Appropriations Chairman Pat Browne (R-Lehigh) and Senate Education Committee Chairman Lloyd Smucker (R-Lancaster).

The language included in the Fiscal Code bill, House Bill 1589, was originally contained in an earlier bill (House Bill 1327), which, along with the General Appropriations Supplemental 2015-16 Budget (House Bill 1801), would have adopted the recommendations of the bipartisan Basic Education Funding Commission (BEFC), on which both Senators served.

However, Governor Wolf vetoed the entire Fiscal Code in March, rejecting the BEFC’s recommendations, and instead implementing his own version of a distribution formula.

“The formula developed by the BEFC and approved by the Legislature, if signed into law, would provide a fair distribution of state education dollars and give a more consistent and predictable indication of the amount of state funding a school district will receive each year based on a funding ratio, determined by a transparent set of factors, from the total state spending on education,” Senator Browne said. “All of the information the commission received throughout more than a year of hearings and meetings allowed us to develop a funding structure based on the actual costs involved in providing basic education, including factors that require more than the normal level of funding for a child.”

Under the Governor’s distribution formula to allocate more than $150 million of increased spending for basic education and $50 million through the educational block grant program, 428 of the 500 school districts in Pennsylvania would receive less than they would under the formula developed by the BEFC.

“I am disappointed that the Governor chose to disregard the fair funding formula recommended by the Basic Education Funding Commission and passed by the legislature – the formula he had supported – in favor of an arbitrary formula that unfairly favors a small number of school districts to the detriment of 428 of the state’s school districts,” Senator Smucker said. “The lack of a fair funding formula for education continues to tip the balance of funds to a few select districts, and does not match the needs to the dollars.

“I am pleased my colleagues in the Senate overwhelmingly supported this legislation to finally establish in law a fair school district funding formula. I hope the House of Representatives follows by passing this to the Governor.”

The Governor’s formula would provide nearly 50 percent of the increased education funding to three school districts, with the Philadelphia School District seeing the biggest benefit under the Governor’s formula versus the BEFC formula ($34,396,591). Meanwhile, under his formula, other struggling school districts – including Allentown (almost $2.5 million less), Erie ($1.1 million less), Hazelton ($1.1 million less), Lancaster ($1.9 million less) and Reading (nearly $3.7 million less) – would see significantly less than under the BEFC formula.

“The General Appropriations Budget passed in March contained language that made it clear that without a funding formula for distributing state education dollars signed into law, spending in excess of 2014-15 funding levels was prohibited,” Senator Browne said. “The passage of this legislation today confirms the legislature’s commitment to establishing a fair funding formula in law, based on the work of the bi-partisan Basic Education Funding Commission.”

The BEFC undertook an extensive and comprehensive study of a number of factors before arriving at a consensus that a new formula was needed for distributing state funding for basic education to Pennsylvania’s 500 school districts.

The Commission determined that allocation of basic education funding needs to allow for accountability, transparency and predictability. The main objective of the new funding formula is to fairly distribute state resources according to various student and school district factors.

The new formula takes into account several student-based factors, including: Student count, which is the average of the most recent three years of Average Daily Membership (ADM), poverty, English language learners and charter school enrollment. The formula assigned weights to each category to help determine the degree to which each factor drives up the cost of educating a student.

The formula also includes three school district-based factors which reflect student and community differences throughout the 500 Pennsylvania school districts. The three factors are:

  • Sparsity Size Adjustment: Which adjusts for student counts in small rural school districts.
  • Median Household Income Index: Which measures a school district’s median household income compared to the statewide median household income.
  • Tax Effort Capacity Index: Recognizes a school district’s ability to generate local tax-related revenue compared to the statewide median.

Contact:          Matt Moyer (Senator Browne) 717-787-1349, mmoyer@pasen.gov

Diane McNaughton (Senator Smucker) 717-787-6535, dmmcnaughton@pasen.gov