Ten months ago Delaware received a report recommending that it spend from $600 million to $1 billion more a year to provide all its public school students with an adequate education.
Last week the commission charged with creating an improved school funding system began its work.
By the time members of the Public Education Funding Commission finished their second session on September 26, they seemed to agree that they won't be able to get the job done by the October 1, 2025 deadline set by the General Assembly.
In fact, they think they may need more than a couple of months to resolve the key question posed by the consultants hired to guide the commission's work: Do they build a new funding system from scratch or remodel the unit count system that has been in place since the 1940s?
The consultants, Michael Griffith of the Learning Policy Institute and Sara Barzee of WestEd, drew some quick pushback after proposing that the commission discuss that issue at its October meeting so it could make a decision in November.
“I'm not comfortable with a 2-hour discussion to say that the final product is this when we're representing a third of the state budget,” said PEFC member Kevin Carson, superintendent of the Sussex County Vocational Technical School District.
“I'm not comfortable with a 2-hour discussion to say that the final product is this when we're representing a third of the state budget."PEFC member Kevin Carson wants more time before serious decisions are made around education funding in Delaware.
The 31-member commission, composed of education leaders, budget experts, legislators and community representatives, tried to digest plenty of information in its first two sessions – diving into the complexities of Delaware’s school funding system and hearing how other states have approached funding reform – but members’ comments demonstrated that they want to dig more deeply into those topics before they make any decisions.
Why have the commission
While the commission’s challenge is to determine how much of the December 2023 study by the American Institutes for Research’s (AIR) report should be implemented – and how to do it – its roots extend much farther back.
In January 2018, a lawsuit filed by Delawareans for Education Opportunity and the NAACP Delaware State Conference of Branches alleged that inequities in the state’s school funding system resulted in certain groups of students – low-income children, English learners and many in special education programs – not receiving an adequate education.
The case was settled in late 2020, with some details worked out in 2021. As a result, all three counties agreed to property reassessments – something that had not been done in 40 years or so – and the state began pumping “Opportunity Funds” into local schools to enhance programs for disadvantaged students.
Another part of the settlement called for the state to pay for an “independent funding assessment” to suggest potential modifications and improvements to the school finance system. The resulted in the AIR report and set the stage for the General Assembly to move forward early this year.
The report made eight recommendations:
- Increase overall investment in public education.
- Distribute more resources according to student need
- Improve funding transparency
- Allow more flexibility in how districts use resources
- Better account for local capacity to raise revenue and address tax inequity
- Regularly reassess property values
- Simplify the calculation of local share provided to charter schools
- Implement a weighted student funding formula, also known as a foundation formula.
After receiving the report, the General Assembly’s Education Committees conducted a one-day hearing to hear more about its details. Rather than starting to act on the recommendations, legislators passed a resolution calling for more study.
Senate Concurrent Resolution 201
The resolution, SCR 201, tasks the commission with 19 responsibilities, far more than merely making recommendations tied to implementing the AIR report. One item on the to-do list is to consider a hybrid funding system – one that combines elements of the 70-year-old system now in place with a weighted funding formula as suggested in the AIR report. It also calls for reviewing state education laws and regulations that impact funding and making recommendations for addressing conflicts, inconsistencies, and disparities.
The commission must consider the impact of recommendations on all students’ needs – both academic and non-academic – and on the recruitment and retention of teachers and other educators. It must also consider the impact any changes would have on revenue collected by school districts through property taxes, and address mechanisms for funding the state’s 24 charter schools.
While the resolution asks for recommendations by next October 1 so they might be included in the state’s Fiscal 2027 budget, which begins July 1, 2026, it calls for multi-year implementation plan, with commission members serving up to two two-year terms and the expectation that the commission would conduct annual reviews of education funding.
The key issue
The big issue facing the commission is the one that was brought up in last week’s sessions: making a choice between building a new funding system from scratch or keeping at least some features of the current unit system. Delaware school finance reform advocates have argued for years that the state must move to a weighted funding system, as recommended in the AIR report, but some school administrators and school board members are comfortable with the unit system because of the year-to-year predictability in funding that it offers.
Griffith, a senior researcher and policy analyst for the Learning Policy Institute, one of the commission’s consultants, used a construction analogy – build a new house or remodel the one that you already have – and suggested that the commission make that choice quickly so it would have more time to work out the details of whatever format the members select. But some commission members, seeing the mass of information presented to them, said they wanted more time to compare the pros and cons of each option before deciding which path to take. Several noted that they are serving as representatives of specific groups – school board members, principals and teachers, for example – and said they would have to get feedback from their constituencies before casting their vote. Still others said they wanted key votes to be taken in person rather than in virtual meetings, which is how the commission’s future sessions are tentatively scheduled.
Units vs. weighted funding: What’s the difference?
In the current $6.1 billion Delaware state budget, education accounts for about $2.1 billion. Local property taxes add almost $1 billion to total education revenues. Federal funds add about $400 more.
Delaware, with its unit system, is one of only seven states that uses a resource allocation system to manage its education spending. Most states – 37 in all – use a foundation or weighted funding system.
Most of Delaware’s spending is allocated to school districts through the unit system, which is based primarily on a student enrollment count taken each Sept. 30. In grades 4-12, a unit is generated for each 20 students. For lower grades and special education students, units are generated for smaller numbers of students. For each unit, a district receives funds to pay for a teacher or two paraprofessionals, plus funding for non-salary expenses and for “equalization,” which provides proportionately more money to districts with lower property tax bases. The number of units in a district also determines how many principals, administrators and other specialists the state will support. Over the years, 32 different unit-generating personnel categories have been established.
On top of that, the state has created funding buckets not tied to the unit system, money for math and literacy coaches or mental health services, for example.
The problem with this system, reform advocates say, is lack of flexibility. Funds designated for energy costs can’t be used to pay the salary of an additional teacher. If a district can’t find a qualified math coach, it loses the money.
In a foundation or weighted funding system, a formula sets a state contribution for each student, with students with special needs (English learners, low income, special education) qualifying for higher amounts (the “weights”). Contributions for all students enrolled then go to their school, which then has the flexibility to decide how much to spend on teachers, administrators, support staff and non-salary costs.
Topics for discussion
During the commission’s second introductory session, members stated concerns and posed questions that demonstrate the magnitude and complexity of the task facing them. Among the items mentioned:
- What is the relationship between additional spending and academic achievement?
- Do current rules governing school transportation result in limiting access for some students to charter schools and choice options outside their home district?
- Can a new system build in projections for increased numbers of special needs students as a result of better identification procedures?
- What is the best way to address equalization issues – providing essential additional funds to districts with lower property values?
- In a transition to a new system, what ensures that a district doesn’t wind up with less funding than it received under the current system? If there is a period of gradual transition, how long should it last?
The next governor’s views
In recent interviews with Delaware Public Media, both candidates, Republican Mike Ramone and Democrat Matt Meyer, expressed support for funding reform.
Ramone said Delaware has “the most complicated funding system in the nation.” While not directly commenting on the AIR report, Ramone said he advocates “enabling and empowering principals” by giving them more autonomy over how funds are spent in the buildings they manage.
Meyer said that the unit system devised in the 1940s doesn’t make sense in the 21st century. He supports increasing spending by $3,500 to $6,500 per pupil, numbers that are in line with the AIR report recommendations.
The time frame
As of now, the commission has virtual meetings scheduled for 4-6 p.m. on the second Monday of each month (except for November, when it will meet on the third Monday), with smaller groups likely to be created to meet in between those monthly sessions. Griffith, the consultant, suggested a rough timeline that would result in the commission pulling together its recommendations at the 11th meeting – in August 2025 – with a final vote on recommendations next September.
Concerns raised at the initial meetings could lead to an extension of that timeline. Before the October 14 meeting, the PEFC chair, Sen. Laura Sturgeon, chairman of the Senate Education Committee, and the vice-chair, Rep. Kim Williams, chairman of the House Education Committee, will meet with Secretary of Education Mark Holodick to discuss issues that might have to be resolved if the timeline is extended.
Then, if an extension is desired, the General Assembly would have to approve a new resolution early next year with new deadlines.
The commission itself does not have an expiration date. According to the synopsis for SCR 201 the commission is expected to remain in operation to “serve as an ongoing body to review the funding annually and recommend updates and changes.”
