Oklahoma public school districts are bracing for additional funding cuts this school year and next, even as they currently struggle to teach students during a pandemic with fewer state dollars.
Choctaw-Nicoma Park Public Schools began the school year with $1.7 million less in state aid than last year.
“That’s significant to us,” said Kevin Berry, the district’s chief financial officer. “I expect to lose several hundred thousand more with the midyear adjustment.”
Mid-year adjustments in state aid are based in part on districts’ Oct. 1 enrollment.
“We’re down 400 kids right now, which was surprising,” Berry said. “Most districts will lose money at midyear.”
The surge in enrollment at virtual charter schools is a big factor, he said.
When students move from a traditional school to a charter school, state money follows them. Epic Charter Schools alone reports it enrolled 61,000 students this school year, nearly 1 in 10 public school students.
“I think we’re facing a real shock to the system,” Rep. John Waldron, D-Tulsa, said. “Tulsa Public Schools is going to lose thousands of students this year.”
He expects many students will return to their community schools after a year or two and those schools will bounce back.
“(Traditional) schools were slow to adjust to virtual. Now they’ve had a wakeup call,” Waldron said. “It’s going to lead to a renaissance in our public schools.”
In the short term, however, he has “tremendous concern” for schools that are losing state aid while incurring additional expenses related to COVID-19. And they likely will take another hit next fiscal year, he said.
A massive shift to virtual education is challenging the system of determining what students actually know and how they know it.
Berry estimates Choctaw-Nicoma Park will lose another $2 million to $2.5 million in state aid in 2021-22, an amount that equals the salaries for 50 teachers.
Midwest City-Del City Public Schools Superintendent Rick Cobb said district officials are discussing how to prepare the community for a different funding picture this year and much different next year.
Mid-Del’s enrollment is down 3,000 students — 2,000 in elementary grades. Cobb said the district is staffed for 14,000 students, but 11,000 enrolled. Next year he expects enrollment to be somewhere in the middle.
Staff reductions are likely, but he hopes much of it will happen through attrition and retirement. Larger class sizes and redistricting elementary school boundaries are possibilities the district is considering.
“It’s a tough season for us to be in,” Cobb said. “Teachers are trying to teach class and it’s harder than it’s ever been. But we’re also trying to prepare for a gigantic budget collapse that our teachers aren’t even feeling yet.”
Allocating Limited Dollars
A February report from the National Center for Education Statistics lists the average per-pupil expenditure in U.S. public schools in 2017 at $12,258. Oklahoma was far below at $7,921. Only Idaho ($7,554) and Utah ($7,206) were lower. Oklahoma’s 3.9% decrease from the previous year was the nation’s largest drop.
Rep. Rhonda Baker, R-Yukon, wanted to increase school funding for districts with a high number of poor students and English language learners in 2019 when the state budget had a nearly $600 million surplus.
Baker, who chairs the House Common Education Committee, and former Sen. Gary Stanislawski, R-Tulsa, co-authored a bill that would have updated the formula Oklahoma has used for more than 30 years to distribute state aid.
Senate Bill 362 passed the Senate 41-6 and passed out of a House committee 11-0 but never got a full vote on the House floor.
It was based on recommendations from a task force to give more weight to higher-need students, which would have increased funding for districts starting this school year, said Stanislawski, who chaired the task force. The plan was to put $200 million from the state surplus into the funding formula to protect districts with fewer high-need students from losing a lot of money to districts that do.
“Anytime you change the funding formula without increasing the money in the formula, you’re just moving funds around,” said Carolyn Thompson, director of government affairs for the State Department of Education, which supports the updates recommended by the task force.
“From a policy standpoint they are all good changes,” Thompson said. “The real challenge comes in passing those changes.”
Stanislawski said more than 60% of Oklahoma public school students are considered economically disadvantaged and experts agree it costs more to educate them. Increasing the weight for those students would shift more money to their districts.
“It’s very challenging to get the Legislature and schools to buy into the changes because there will be winners and losers and that varies from year to year,” Stanislawski said.
The state Board of Education on Thursday placed a new set of expectations on Tulsa Public Schools as part of its heightened monitoring of the district.
A district like Oklahoma City Public Schools — with more than 91% of students eligible for free and reduced-price lunches — would benefit greatly from the change, Baker said. But she heard from districts in her area — like Edmond and Deer Creek — that were concerned about losing funds.
“If they did that, we would be a loser,” said Berry, the Choctaw-Nicoma Park chief financial officer, noting that only 38% of his district’s students are eligible for free and reduced-price lunches.
The extra $200 million in the formula would be for one year but the changes to the funding formula would be ongoing. That would mean less money for the district in years when state education dollars declined, he said.
Berry compared it to teacher pay raises. The state put the additional money into the education budget initially. “We’re still paying it, but there’s less money in the formula now,” he said.
Baker said the state needs to change the funding formula to accurately reflect today’s student body.
“Last year we had a funding surplus. Now we don’t have those dollars,” Baker said. “It all comes down to timing and money. The timing is wrong, and we don’t have the money.”
The Funding Formula
School funding in Oklahoma comes from local and state revenue at about 45% each, with federal funds providing another 10% for certain student populations.
The formula works like this: Each year the Legislature puts money into the funding formula ($2.3 billion for 2021) and the state sets a base amount available per student ($3,581 for 2020). School districts calculate the number of students enrolled using a weighted formula that assigns extra weights for higher need students, such as those who have a disability or are bilingual. The current weight for a speech impairment is .05. For bilingual and low-income students, it is .25.
“The more weighted students, the thinner the dollars get spread,” Thompson said.
The total weighted amount is multiplied by the base amount to determine the district’s need for the school year. Local revenue from sources like property tax and gross production tax is applied first and the state provides the balance.
Currently 42 districts have local funding bases sufficient enough to not require state dollars to meet education needs, though they may receive a small amount of funding for transportation.
Charter schools, however, are excluded from receiving local tax dollars, so nearly all their funding comes from state dollars. That means a virtual charter school receives more state aid to educate the same student than if the student was enrolled in a traditional school.
“The formula wasn’t really set up for districts that take 100% state aid. They take a big chunk,” Berry said.
Thompson said the growing enrollment in charter schools and what happens to those students next year will impact Oklahoma’s funding formula for years to come.
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