Fair School Funding Plan A comprehensive, fair school funding plan for Ohio Slide Sponsors: State Representatives Bob Cupp & John Patterson

Base Cost Distribution Add-ons Poverty, Preschool, Special Education, Gifted, English Learners, Career Tech Education, STEM, Open Enrollment, Charter/Community Schools, Vouchers, Transportation, Educational Service Centers Distribution Jenni to introduce Mike and highlight the three again

Fair Funding Plan Distribution The Fair Funding Plan Distribution Formula is equitable, untangles complex interrelationships among districts where one district’s funding is tied to another, and recognizes diversity between districts. Mike -

The Challenge - Distribution Current Local Share of Funding 60% to 100% - PROPERTY VALUES 0 to 40% - BASED ON RESIDENT INCOME Mike -

State Share Index Valuation Index DISTRIBUTION State Share Index Valuation Index District's three-year average valuation / District's total ADM) / (the statewide three-year average valuation for school districts with a total ADM greater than zero / the statewide total ADM) Mike -

State Share Index Median Income Index DISTRIBUTION State Share Index Median Income Index The district's median Ohio adjusted gross income / the median of the median Ohio adjusted gross income of all districts statewide with a total ADM greater than zero Mike -

State Share Index Income Index DISTRIBUTION State Share Index Income Index (The district's median income index X 0.5 ) + [(the three-year average federal adjusted gross income of the school district's residents / the district's formula ADM for fiscal year 2017) / (the three-year average federal adjusted gross income of all districts statewide with a formula ADM for fiscal year 2017 greater than zero / the statewide formula ADM for fiscal year 2017)] X 0.5 Mike -

State Share Index Wealth Index DISTRIBUTION State Share Index Wealth Index (1) If the district's income index is less than the district's valuation index and the district's median income index is less than or equal to 1.5, then the district's wealth index shall be equal to [( 0.4 X the district's income index) + ( 0.6 X the district's valuation index)]. (2) If the district's income index does not meet both of the conditions described in (1) of this section, then the district's wealth index shall be equal to the district's valuation index. Mike -

DISTRIBUTION State Share Index (1) If the district's wealth index is less than or equal to 0.35, then the district's state share index shall be equal to 0.90. (2) If the district's wealth index is greater than 0.35 but less than or equal to 0.90, then the district's state share index shall be equal to { 0.40 X [( 0.90 - the district's wealth index) / 0.55 ]} + 0.50. Mike -

DISTRIBUTION State Share Index (3) If the district's wealth index is greater than 0.90 but less than 1.8, then the district's state share index shall be equal to { 0.45 X [( 1.8 - the district's wealth index) / 0.9 ]} + 0.05. (4) If the district's wealth index is greater than or equal to 1.8, then the district's state share index shall be equal to 0.05. Mike -

The Charge - Distribution (Lesser of 3-Year Average Valuation or most recent Valuation) / (K-12 Headcount Enrollment) x (2.25% x 60%) (Lesser of 3-Year Average FAGI or most recent FAGI) / (K-12 Headcount Enrollment) x (2.25% x 20%) (Most Recent Median FAGI) X (Most Recent Number of Tax Returns) / (K-12 Headcount Enrollment) x (2.25% x 20%) Mike -

Distribution DISTRIBUTION Determination of Local Share of Funding-Property Mike S The first step is determining valuation per pupil

Distribution Determination of Local Share of Funding-Income Mike S Secondly we calculate the income capacity per pupil.

Determination of Local Share of Funding-Total DISTRIBUTION Distribution Determination of Local Share of Funding-Total The state share of funding in each district would be the per pupil base cost amount calculated for the district less the local share shown above Mike S

Benefits Associated with the proposed model DISTRIBUTION Distribution Benefits Associated with the proposed model All Districts calculated in the same way Each district is handled independent of statewide averages Accounts for enrollment changes Less dislocating with annual recalculations Increased Stability 84% of districts would be formula funded Mike S

funded at their calculated formula amounts The Formula Doesn’t Work 18% of Districts Current funded at their calculated formula amounts The Formula Doesn’t Work Mike S

funded at their calculated formula amounts With New Fair Funding Plan 84% of Districts New Plan Mike S Total districts 610 136 districts in 2020 on guarantee 100 district in 2021 on guarantee funded at their calculated formula amounts New Plan: 84% of Districts on Formula by 2021

SIMULATION RESULTS An estimated 510 districts would receive additional funding in the upcoming biennium An estimated 100 districts would receive the same amount of funding as they received in FY 2019 PLEASE REMEMBER THE SIMULATIONS ARE DONE USING ESTIMATED VALUATIONS, INCOMES, AND ENROLLMENTS Tell county story

SIMULATION RESULTS There are five general factors that influence funding in this model relative to FY 2019 and the current funding model For districts with offsetting factors, it will vary from district-to-district as to which factor matters most Tell county story

SIMULATION RESULTS Because of minimum allocations within the base cost funding model, small districts will generally do better than under the current model Districts currently impacted by capped funding also generally have more positive results When looking at data by capacity quintiles, districts that currently get lower allocations than similar districts in the same capacity quintiles generally do better Tell county story

SIMULATION RESULTS Districts whose enrollments are significantly below their current ADM tend to get smaller or no increases relative to those without this condition Districts that have seen sharp increases in Public Utility Property Values between 2016 and 2018 tend to get smaller or no increases THERE CAN BE DISTRICTS MEETING ANY OF THESE 5 CRITERIA THAT DO NOT TREND LIKE MOST OTHERS MEETING THE CRITERIA Tell county story

FY 19 STATE AID FOR STUDENTS BEING EDUCATED IN THE DISTRICT Third through eleventh districts with the least capacity measured by Targeted Assistance Wealth Tell county story

SIMULATION RESULTS BY CAPACITY QUINTILE FOR THE FAIR FUNDING PLAN FY 2021 Average Per Pupil Aid Lowest Capacity $8,821 Quintile 2 $6,784 Quintile 3 $5,835 Quintile 4 $4,646 Highest Capacity $2,593 Tell county story

SIMULATION RESULTS BY CAPACITY QUINTILE Guarantee Districts under Fair Funding Plan Non-Guarantee Districts under Fair Funding Plan Lowest Capacity $10,366 $7,753 Quintile 2 $6,795 $6,092 Quintile 3 $6,163 $5,196 Quintile 4 $4,576 $4,012 Highest Capacity $3,042 $1,978 Districts on the guarantee under the proposed formula have significantly more current funding than other districts with similar capacity Per Pupil state funding after all deductions--FY2019 allocations for guarantee and non-guarantee districts under the Fair Funding Formula Tell county story

SIMULATION RESULTS BY CAPACITY QUINTILE Estimated Average Increase Lowest Capacity $648 Quintile 2 $692 Quintile 3 $624 Quintile 4 $663 Highest Capacity $460 Average per pupil gain per quintile for districts receiving additional revenue under the Fair Funding Plan Tell county story

Distribution in Conclusion This proposal provides for the needed rational, transparent, comprehensive and understandable distribution method that will provide for stability and scalability among the State’s 610 Districts. Mike S