I_SFinance_2021A 08/24/2021 09:06:17 AM Committee Summary

PUBLIC
STAFF SUMMARY OF MEETING
INTERIM COMMITTEE LEGISLATIVE INTERIM COMMITTEE ON SCHOOL FINANCE

Date

08/24/2021

Attendance
Coleman	X
Geitner	E
Herod	X
Larson	X
Lundeen	X
Zenzinger	X
Kirkmeyer	X
McCluskie	X

Time

09:06:17 AM to 03:30:35 PM

Place

SCR 357

This Meeting was called to order by

McCluskie

This Report was prepared by

Annie Kitch

Hearing Items	Action Taken
hOpening Remarks	Committee Discussion Only
hOverview of School Finance in Colorado	Committee Discussion Only
hUpdate on Federal COVID-19 Funding	Committee Discussion Only
hAt-Risk Students and Funding	Committee Discussion Only
hDiscussion of Poverty Study Proposals	Committee Discussion Only
hLogistics and Next Steps	Committee Discussion Only

Opening Remarks - Committee Discussion Only


	09:06:38 AM	Representative McCluskie gave opening remarks, welcomed new members, and reviewed the agenda. Committee members also made opening comments and discussed their goals for the committee. Committee discussion ensued.

Overview of School Finance in Colorado - Committee Discussion Only


	09:22:20 AM	Brita Darling and Julie Pelegrin, Office of Legislative Legal Services (OLLS), and Marc Carey, Legislative Council Staff (LCS), introduced themselves and began their presentation regarding the school funding formula. The presentation was sent to members of the committee and can be accessed here: http://leg.colorado.gov/content/isfinance2021acommdocs
	09:22:21 AM	Ms. Darling reviewed the formula for calculating funding which is based on factors such as school district characteristics, including statewide base funding, personnel costs, cost of living, nonpersonnel costs, and the size of the district. The panelists responded to questions from the committee.
	09:42:29 AM	Ms. Darling continued her presentation and described funding based on student characteristics. Committee members discussed previous efforts to shape the School Finance Funding Formula. Brita Darling continued her presentation by describing additional aspects of the funding formula such as the funded per pupil count, district total program, and the budget stabilization factor (BSF). Ms. Darling explained that the BSF is a percentage reduction in each school district's total program funding that is calculated after the base per-pupil funding amount is increased and other district-specific adjustments are calculated. Ms. Darling then provided a summary of the 2021-22 school finance formula funding.
	09:57:11 AM	Dr. Carey continued the presentation by explaining that school funding primarily comes from state and local shares, which equaled approximately $8.0 billion in FY 21-22. He shared that state and local shares can vary significantly by district and funding can look difference once the BSF is applied. Dr. Carey explained that revenue sources can include mill levy overrides, binding, fundraising, grants, categorical funding from the state, state funds from sources such as the READ Act, and federal revenue. Dr. Carey responded to questions from the committee regarding state and local funding sources, mill levies, and forms of revenue.
	09:58:12 AM	Dr. Carey explained that local shares have generally decreased over time, as the state share has increased in an attempt to offset those decreases because of three constitutional factors: the passage of the Gallagher Amendment in 1982; the passage of the Taxpayer Bill of Rights (TABOR) in 1992, and the passage of Amendment 23 in 2000. Both the Gallagher Amendment and TABOR have put downward pressure on local property tax revenue. The passage of Amendment 23 has driven increases in total program funding based on inflation and enrollment growth.
	10:21:13 AM	Julie Pelgrin continued the presentation by explaining that after the passage of Tabor in 1994, most districts waived the TABOR revenue limit, but still reduced their mill levies. In 2007, the General Assembly amended statute to clairfy that districts only needed to reduce their mill levies to stay within the TABOR revenue limit if they were subject to the limit. The General Assemly also amended statute to cap mill levies at 27 mills. House Bill 20-1418 and House Bill 21-1164 then reset the mill levies for districts subject and not subject to the TABOR limit. The presenters responded to questions from the committee regarding mill levy overrides, provisions in HB 20-1418 and HB 21-1164, and mill levy resets that may take place without voter approval.

Update on Federal COVID-19 Funding - Committee Discussion Only


	10:38:38 AM	Kate Bartlett, Colorado Department of Education (CDE), discussed federal funding that Colorado received during the COVID-19 pandemic. A large amount of funding came from Elementary and Secondary School Emergency Relief (ESSER) Funds with the intention of addressing the impact that COVID-19 has had on education. ESSER funds were established as three different funding streams: ESSER 1, designated under the CARES Act for the purpose of crisis response; ESSER II, established under the Coronavirus Response and Relief Supplemental Appropriations Act for resuming and sustaining in-person instruction; and ESSER III, established under the American Rescue Plan Act for the purpose of aiding in recovery. Ms. Bartlett also shared information on additional federal funds for education such as the Governor's Emergency Education Relief fund, Coronavirus Relief Funds for education, and emergency assistance for non-public schools. She shared that CDE is actively working to ensure that schools receive as much information and opportunity as possible to receive these funds. Ms. Bartlett responded to questions from the committee regarding federal funds and compensatory services. Ms Bartlett's presentation was sent to members of the committee and can be accessed here: http://leg.colorado.gov/content/isfinance2021acommdocs
	10:57:40 AM	Kate Barlett shared that ESSER allocations are calculated using the Title I formula; however, these funds may be used for any allowable activities under ESSER funding guidelines and are not subject to Title I requirements.Coronavirus Relief Funds were distributed on a per-pupil basis that incorporated factors from the School Finance Formula. Ms. Bartlett and Jennifer Okes, also with CDE, answered questions from the committee regarding the distribution of Coronavirus Relief Funds, federal government audits around funding uses, and CDE's efforts to review applications for funding to ensure that they're consistent with the allowable uses listed in the funding guidelines.
	11:08:18 AM	Kate Bartlett continued her presentation by explaining the ten largest total ESSER & Coronavirus Relief Fund allocations. She also described the allowable and common uses of district ESSER funding. Ms. Bartlett responded to questions from the committee regarding ESSER applications, funding distribution, and spending. Ms. Bartlett provided an overview on how the state broke down the ESSER funds that have been set aside. Ms. Okes explained the methods that CDE took to distribute funding to the districts.
	11:24:18 AM	Ms. Bartlett responded to questions from the committee regarding student enrollment for fall 2021 in the midst of the COVID-19 pandemic.

At-Risk Students and Funding - Committee Discussion Only


	11:26:04 AM	The committee recessed.
	01:19:34 PM	The committee reconvened.
	01:22:05 PM	Riley Kitts and Stephanie Perez-Carrillo, Colorado Children's Campaign (CCC), shared that the at-risk student factor, which increases with the number of at-risk students, is currently at $495 million. Mr. Kitts also explained how CCC used data related to free and reduced lunch (FRL) enrollment to measure poverty. He stated that FRL is not the most accurate proxy to identify student need because it only counts for income status; is a binary measure; may hinder participation in other programs; and is not collected in a centralized location. Mr. Kitts and Ms. Perez-Carrillo responded to questions from the committee regarding other data that could possibly be used to identify at-risk students.
	01:34:32 PM	Ms. Perez-Carrillo continued the presentation by sharing that FRL data is often decentralized because it is collected at the district level. She shared that districts do all that they can to collect the data, but there are technological and resource limitations. Ms. Perez-Carillo responded to questions from the committee regarding school staff and parents' awareness of the FRL program. Committee discussion ensued. Mr. Kitts continued the presentation by discussing options that members should consider to improve data collection methods such as examinging IT systems.
	01:45:43 PM	Michael Griffith, Learning Policy Institute, presented on methods to identify at-risk students such as collecting census, foster care, and Supplemental Nutrition Assistance Program (SNAP) data. He also discussed why many states use FRL as a proxy to measure poverty, as it's a good marker for school status as a whole, but also noted how it often does not account for an individual student's situation. Mr. Griffith shared how Massachusetts and Texas successfully use other measures to identify at-risk students. Mr. Griffith responded to questions from the committee regarding FRL data.
	02:12:17 PM	Dr. Wendy Birhanzel, Superintendent, Harrison County School District, explained that her district is in dire need of additional resources that the school funding formula is not meeting. She urged the committee to look at what other states are doing successfully to meet student need as a model for Colorado. Superintendent Birhanzel responded to questions from the committee pertaining to other criteria used to determine at-risk student status.
	02:20:35 PM	George Welsh, Superintendent, Canon City School District, provided a background on his district and shared that the district is at a 55% poverty level; however, it may be higher because high school students often don't submit their FRL forms. He also encouraged the committee to look at other states' models to identify at-risk students. In addition, he suggested that the worth of each mill levy within each district should be re-examined. Mr. Welsh and Ms. Birhanzel responded to questions from the committee regarding the current at-risk student measure and their experience working with different demographics within their districts. Committee discussion ensued.

Discussion of Poverty Study Proposals - Committee Discussion Only


	02:54:55 PM	Anna Gerstle, LCS, provided an overview of the three responses that the committee received for a request for proposal to conduct a poverty study on school districts in Colorado. The committee discussed the vendor proposals. The vendors responded to questions from the committee regarding their approach to factoring in the many systems that come into play when measuring poverty across districts.

Logistics and Next Steps - Committee Discussion Only


	03:27:36 PM	Ms. Gerstle shared that the Committe will meet again on September 17, October 19, November 5, and January 10. The committee will announce bill draft requests during the November 5 meeting and vote on the drafts during the January 10 meeting. Representative McCluskie shared possible topics for discussion at future meetings.

03:30:35 PM

The committee adjourned.