KingSpry | PA Governor's Proposed Budget for School Funding

Governor’s Proposed Budget Could Be Game Changer for School Funding

Posted on February 10th, 2021
by Jonathan M. Huerta

On February 2, 2021, Governor Tom Wolf announced his budget proposal for the 2021-2022 fiscal year.

Governor Wolf addressed concerns regarding barriers that Pennsylvanians are currently facing, and he emphasized his interests in focusing on Pennsylvania’s ‘unequal and underfunded’ education system.

Summary of Education Budget:

Basic Education Funding (BEF): Governor Wolf proposed an increase in Basic Education Funding and a redistribution of funding to districts with the greatest needs. All BEF will be redistributed through a new formula that considers students’ needs and other district factors. The proposed budget includes $8,133,774,000 for the BEF appropriation, which is a $1,352,056,000 increase from last fiscal year’s appropriation. This puts all existing state-level BEF through the new Fair Funding Formula and incorporates $1,152,056,000 so no school district is negatively affected by the transition.

The remaining $200,000,000 will provide every school district in the Commonwealth with some increase in BEF. Some districts in the Lehigh Valley could see over a 100% increase in BEF. The budget also included a statutorily mandated appropriation of $526,639,000 to be used for School Employees’ Social Security payments to school districts.

Special Education Funding: In the last decade, special education costs have increased by over $2 Billion – with a B – dollars while the state’s funding obligation only grew by $110 million dollars. Now, Wolf’s proposed budget includes a $1,386,815,000 appropriation for Special Education, which is a $200,000,000 increase from last year’s funding. Additionally, the Special Education appropriation includes funding of about $102,679,169 to be used for Special Education Contingency Fund, Core Services funding to Intermediate Units, Institutionalized Children’s Program funding, special education for wards of state students, and special education for students placed out of state.

Charter School Funding and Policy: Governor Wolf proposed several reforms for charter schools, including a flat rate of $9,500 per student for cyber charter regular education and a moratorium on new cyber charter schools. Additionally, Governor Wolf  would apply the special education funding formula to all charter schools in an effort to match tuition payments with actual costs. Other reforms include statewide performance standards for charters and greater accountability requirements to hold charter schools to greater financial and ethical standards and oversight.

Construction Funding: Governor Wolf’s budget ended the 2016 moratorium for PlanCon by including $200,000,000 to partially reimburse school districts for construction projects. Also a part of the proposed budget is a $1 billion dollar expansion of RACP, the Redevelopment Assistance Capital Program which provides grants to districts to remediate and enhance student access.

Early Learning and Secondary Career and Technical Education: Wolf’s proposed budget includes $268,000,000 for the Ready to Learn Block Grant. The purpose of this grant is to enhance learning opportunities for students and provide resources for schools to innovate at the local level. For example, funds may be used for teacher training and professional development, pre-k to Grade 3 extended learning opportunities to allow for additional classroom instruction, and establishing and expanding on hybrid-learning models, to name a few. Wolf’s proposed budget also includes $66,639,000 for the Secondary Career and Technical Education Subsidy.

Higher Education Funding: Governor Wolf also proposed changes in higher education funding, including $199 million in scholarships for full-time students in Pennsylvania’s state-owned, public Pennsylvania System of Higher Education, with a priority for students in the fields of education and nursing. Depending on their family income, students would receive up to $5,700 per year in annual scholarships. Wolf proposed changes to the Educational Improvement Tax Credit and Opportunity Scholarship Tax Credit Programs which permit businesses to allocate certain tax payments away from Pennsylvania’s Treasury into organizations that provide scholarships. Previously, these organizations could retain as much as 20% of the funds received as “administrative costs.” Under Wolf’s proposed budget, this amount would be maxed at 5% and would require these organizations to report more information about the families receiving funding.

Additionally, Wolf’s budget guarantees a minimum $45,000 annual salary for teachers.

In his address, Governor Wolf stressed that our local school systems are lacking the necessary resources they need to provide the student with a quality education. Governor Wolf also noted the increasing costs of higher education and how these costs make high-quality education less accessible. Over the past five years, there has been an additional $1.4-billion-dollar funding for pre-k through college education, but Governor Wolf explained this has not been enough because far too many families throughout Pennsylvania still do not have access to these educational opportunities.

Critics take issue with the funding sources for these increases, including the increase to Pennsylvania’s Personal Income Tax rate from 3.07% to 4.49%. Also at issue are funds redirected from Pennsylvania’s Race Horse Development Fund to Governor Wolf’s new higher education scholarship program.

In addition to the almost $2 billion dollar investment into school districts and schools, and distributing education funds in a more equitable way, Governor Wolf’s proposal pushes for charter school funding reform and investments in the school infrastructure. According to his address, the budget includes reforms that would hold charter schools accountable for the results they deliver. School districts pay the tuition for students who live in their districts but attend charter schools, and these costs make up a large portion of district budgets.

Under Governor Wolf’s proposed plan, the state’s special education funding formula would apply to charter schools the same way it does to traditional public schools. Additionally, Governor Wolf’s proposal to create a universal cyber charter school tuition rate of $9,500/student could save school districts additional millions a year.

Bottom Line for Schools

Political reality in Harrisburg portends a difficult road for the Governor’s proposals for education funding. It is in the interest of all who value public education to aggressively advocate for more and fairer funding for education.

Efforts to cure Pennsylvania’s lopsided educational funding continue in the courts as well. The case of William Penn School District etal v PA Department of Education etal, currently in the Commonwealth Court, has advanced further than previous judicial challenges to PA’s school funding formula. As always, we will continue to keep everyone up to date with the ongoing effort to reform school funding.

If you have a question, please contact your legal counsel or one of the Education attorneys at KingSpry.


School Law Bullets are a publication of KingSpry’s Education Law Practice Group. This article is meant to be informational and does not constitute legal advice.