Illinois is proposing changing how the State funds public education
EDGE Illinois is providing a data driven analysis of how the proposed changes will affect all School Districts in our State.
Click here for an overview of the Education Funding Reform Act 2015 (SB1)
The Education Funding Reform Act of 2015 (Senate Bill 1) is a reintroduced version of Senate Bill 16 with changes to address some of the concerns that were raised by School Districts, legislators, community members and parents. The purpose of the bill is to modify how State education dollars are distributed through the funding formula.
Below is a summary of the key changes in the Education Funding Reform Act of 2015 (SB1).
The sponsors of the bill are asking for an additional $500 million in State education funding to support the proposed changes. The feasibility and the source of the additional funding will be part of the legislative budget discussions.
Regional Cost Difference
A regional cost difference was added to SB1 to account for cost of living and comparable wage differences in our State.
SB1 temporarily reverts back to the current method of determining how many low-income students are in a School District. The current method of using data from the Illinois Department of Human Services will continue to be used for two years and then the Illinois State Board of Education (ISBE) can switch to a different method of counting low-income students without needing to get the new method approved by legislators. Depending on which method ISBE ultimately selects could greatly affect the amount of State Education funding a School District receives each year.
A new "Adequacy Grant" will be provided to School Districts that have an above average property tax rate and who are not adequately funded. This new provision will prevent these School Districts from losing funding as the State works to increase overall funding for education.
Concern about local tax rates was an issue raised with SB16. During the data analysis, it was discovered that School Districts that were projected to lose the highest amount of per student State funding were Districts that had the highest tax rates. To address this concern, additional Hold Harmless provisions were added to SB1. Click here for the SB16 loss to tax rate comparison chart.
An expiration date of 2023/2024 was also added to the Hold Harmless $1,000 per student loss cap.
Special Needs Students
SB1 funds programs for Special Need students using the Statewide average of 13.8% for all School Districts. A change has been made with SB1 to allow School Districts to request additional funding for up to 18.8% of their students.
One of the concerns raised with this approach is that using an average % of Special Needs for all School Districts does not differentiate the costs associated with serving different type of special needs. For example, a student receiving basic speech lessons would be funded at the same level as a student that requires a dedicated aid.
Available Local Resources
One of most significant changes with the proposed SB1 formula is that it modifies how Available Local Resources are calculated for School Districts that are subject to limits in how much they can increase Property Tax Revenue by each year to match the increase in the Consumer Price Index (CPI) for that year. Click here to see which counties limit the amount that Property Tax revenues can increase by each year.
The negative impact of this proposed change will not be seen in the SB1 projections that the Illinois State Board of Education provides because property value is basically at a ten year low for many Communities in our State. The impact will be felt as property value continues to recover in the next few years.
Click here to learn more about how Property Tax increase limits and how the proposed changes in SB1 will negatively impact School Districts funding.