Tennessee’s school districts have started preparing their individual budgets for the 2023-2024 school year. They are doing it while contending with a new state funding formula and limited guidance from the Tennessee Department of Education (TDOE). The change in formula completely alters how district allocations from the state are calculated. In the past, the state has provided calculations for local districts. This year, that, too, will change.
In notes obtained by The Tennessee Star from a call between the TDOE and the Superintendent Study Council, local officials were informed that the department will soon be sending out Data Verification Packets to districts that will include district-specific data from 1st, 2nd, and 3rd 20-day reporting periods. Districts are required to report attendance counts at 20-day intervals throughout the year.
The TDOE will not be providing TISA projections. Instead, districts will need to take the data from their packet and plug in the info in the TISA calculator for their estimates. These are the estimates districts should use in their individual budget process.
For some districts, this is a simple calculation and that data will suffice. In others, the calculations are a little more complex, and more is needed.
For Metro Nashville Public Schools (MNPS), the biggest factor impacting the budgeting process is the state’s fiscal capacity index, which determines the amount of state funding the district will receive compared to the local match. This number is arrived at through a complex calculation involving, property values and taxable sales, along with additional factors like household income, the number of students per county resident, and the ability to export some taxes.
MNPS spokesman Sean Braisted told The Star, “Our understanding is that the fiscal capacity index won’t be finalized until late March or early April. So while the state may release preliminary TISA projections based on enrollment, until we know the fiscal capacity index that is being applied to the formula, the estimates won’t be reliable for budgeting purposes.”
“Additionally, there is a provision in the law that would allow for a cost-differential factor to be applied to funding for districts like MNPS that have a higher cost of operating than the average county,” Braisted added, “but that is subject to appropriations and we do not yet know if that will be funded by the Governor/Legislature.”
The lack of information is not having much of an impact on budget preparation for smaller districts, or those whose school boards don’t approve next year’s budget until May. However, for larger districts and those with earlier deadlines, it is creating some additional challenges.
“The Metro budget is typically submitted by the Mayor towards the end of April and the funding figure for MNPS is a combination of state and local revenues, so knowing what we’ll receive from the state is very informative to the overall budget allocation,” Braisted said. “Last year, we did not receive April BEP estimates until the end of the month which did have a negative impact on the budgeting process.”
Braisted is referring to MNPS being informed late in last year’s budgeting process that there was a $22.6M shortage in the district’s estimated funding and the actual money received. In March of 2022, the state board of education estimated the BEP funding for MNPS at $312M. This amount was used to prepare the budget that was included in the mayor’s 2023 budget for the city. However, in April, this amount was adjusted to $295M. In addition, the amount to be transferred to state-run chartered schools went up by almost $10M, creating a deficit of $22.6M in the mayor’s budget. Last-minute adjustments were required to be made to the city budget.
Another factor further complicating budget calculations for local districts is that the rules governing the transition to TISA have not yet been codified. A rule-making hearing for BEP to TISA transition rules is set for January 30th. The next State Board of Education meeting is scheduled for February 11, 2023.
In an effort to simplify the state’s school funding formula, last legislative session, the Tennessee General Assembly voted to discontinue using the state’s Basic Education (BEP) formula, and transition to the Tennessee Investment in Student Achievement (TISA). This marked the first change in student funding in 30 years. A move that left districts scrambling to master new calculations.
Both formulas are driven by student attendance, but TISA puts a greater emphasis on the individual student. Under the new formula, each student is awarded a base amount of funding and then assigned additional monies based on weights they qualify for through their unique learning needs – students with disabilities, gifted students, students with characteristics of dyslexia, and English learners. Impoverished students, those who live in concentrations of poverty, and those who live in rural districts receive additional weight. Districts receive additional monies through direct funding and outcomes funding.
Recognizing that there would be challenges and unforeseen consequences in making a change of this magnitude, legislators built a four-year hold harmless caveat into the law. Over the next four years, districts will not see less money from the state than they did under the previous BEP formula.
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TC Weber is a reporter at The Tennessee Star and The Star News Network. He also writes the blog Dad Gone Wild. Follow TC on Twitter. Email tips to [email protected]. He’s the proud parent of two public school children and the spouse of a public school teacher.
Photo “Teacher and Student” by RODNAE Productions.
The only things guaranteed in school funding are that the per student cost will go up dramatically and the districts will continue to grow top heavy with more “administrators”. The other guaranteed thing is that students will continue to fail academically and be indoctrinated with CRT and “woke” garbage.
It does not take a rocket scientist to see that our education system is broken. Jut look at the way it is regulated and funded. Very little of this is actually benefiting children as much as it is providing funding for a bureaucracy that lines its pockets based on the pretext of education. Financial Audits keep honest people honest, perhaps that is why we don’t audit our educational institutions.