1. Senate Bill 16 Overview October 2014

2.  Adequacy—provides a level of funding sufficient for a high quality education.  Simplicity—provides districts a predictable, understandable revenue stream that is used to maximize student outcomes.  Transparency—is easily accessed and understood by all citizens.  Equity—begins with everyone contributing a minimum tax rate and adjusts for student need by weighting the formula to allow for additional resources to address impediments to student achievement.  Outcome-focused –encourages student growth in learning.

4. An education funding formula that provides additional weights for pupils with defined characteristics to arrive at a district budget from which available local resources are deducted. (Foundation Level (FL) x Combined Student Weight) x District ADA ) – Available Local Resources = Primary State Aid Primary State Aid is the greater of District Budget – Available Resources or a Flat Grant Amount (3.5% of FL). Hold Harmless Provisions: “Phase-In Period” Year 1 – A district will realize 25% of the Gain or Loss compared to the base year Year 2 – A district will realize 50% of the Gain or Loss compared to the base year Year 3 – A district will realize 75% of the Gain or Loss compared to the base year $1,000 Per Pupil Loss Cap No district will lose more than $1,000 per pupil as compared to the base year. This provision is indefinite. The model for Senate Bill 16 is based upon data from the 2011-2012 School Year and Fiscal Year 2013 Distributions.

5. CategoryWeighting FactorWeighting Percentage Low-Income Pupils – the higher of:Additional Weight Capped at 0.75 A. Regular Low-Income Method (0.25 x LI%)0.25Prior Year ADA ÷ District Prior Year ADA B. Low-Income Concentration Method (0.90 x LI%²) 0.90 (Prior Year ADA ÷ District Prior Year ADA)² Limited English-Speaking Ability0.20Prior Year ADA ÷ District Prior Year ADA Children with Disabilities1.0013.8% Special Education Summer School0.03 Prior Year ADA ÷ District Prior Year ADA Gifted Pupils0.01 Prior Year ADA* ÷ District Prior Year ADA *(capped at 5% of Prior Year ADA of K – 8 th Grade) Regular Transportation Pupils 0.06 Most Dense Quintile 0.10 Least Dense Quintile Prior Year ADA ÷ District Prior Year ADA Extraordinary Transportation Eligible Pupils Resulting from consolidations or students who live a significant distance from school (Effective 2015 – 2016 School Year or Year 2) Not to exceed 0.12 Prior Year ADA ÷ District Prior Year ADA Vocational Transportation0.12 Prior Year ADA ÷ District Prior Year ADA Advance Standing Pupils (Effective 2016 – 2017 School Year or Year 3) 0.02 Prior Year ADA ÷ District Prior Year ADA Career Pathway Completers (Effective 2016 – 2017 School Year or Year 3) 0.03 Prior Year ADA ÷ District Prior Year ADA

6. Districts that Win  Average Low Income Concentration of 53%  Average Available Local Resource Per Pupil $3,309 Districts that Lose  Average Low Income Concentration of 28%  Average Available Local Resources Per Pupil $8,952

8. Total Per Pupil Combined Student Weight District Budget ($5,154 FL) Available Local Resources (ALR) Primary State Aid (PSA) Weighted Foundation Level (WFL) Available Local Resources (ALR) Primary State Aid (PSA) District A 1.7774 $ 32,130,572 $ 9,023,752 $ 23,106,821 $ 9,161 $ 2,573 $ 6,588 District B 1.7849 $ 33,774,823 $ 16,190,190 $ 17,584,633 $ 9,200 $ 4,410 $ 4,790

9. Why does the PTELL Adjustment Increase So Much even with an 80% PTELL EAV Floor? FY13 Gross GSA Claim PTELL Adjustment $502m SB 16 PTELL Adjustment $762m Increase $260m The GSA Foundation Formula Claim has three different funding levels:  Foundation Method 0% to <93% of the FL in ALR  Alternate Method 93% to <175% of the FL in ALR (5% to 7% of FL)  Flat Grant Method175% and above of the FL in ALR ($218) SB16 Eliminates the 2 nd funding level and the PTELL Adjustment is now: (Real EAV – PTELL EAV) x Assumed Rate

13.  ISBE Support: Dedicated funding for ISBE staff & contractual services for ELL and Special Education oversight and support  Reporting: For each district, reporting of weights and funding attributable to those weights  District Plans: For districts required to complete a District Improvement Plan, budget submitted with the plan must demonstrate budgeting for strategies giving priorities to low-income, ELL, and special education students consistent with weighting  CPS School Allocations: Maintain the current SGSA requirement for $261M to be distributed to schools pursuant to an ISBE-approved plan  School Based Budgeting: Beginning in the second year of the law’s implementation, ISBE institutes a system for accounting for revenues and expenditures at the individual school level, which would highlight inequities that may exist within a school district.

14.  Primary State Aid Review Committee: Recommendations by January 31, 2017 addressing: Relating funding to district accountability or accreditation status Whether to include State CTE and special education transportation in the formula Whether to account for municipal impact fees, TIF distributions, available fund balances, etc. in ALR calculation Whether regionalization factors should be incorporated Methods for reducing PTELL adjustments  Adequacy Study: Subject to funding, by no later than 1/31/19 ISBE is to contract for a study of the adequacy of education funding in the State.

15. Measurement of Available Local Resources ◦ Assumed Rates ◦ Tax Increment Financing Districts Distributions ◦ Personal Property Replacement Tax Distributions ◦ Elimination of the PTELL Adjustment High Cost Special Education Reimbursement ◦ The original language in SB 16 placed reimbursement for private special education facilities at the same level as placements within district-run programs $1,000 Per Pupil Loss Cap ◦ A phase out of the provision for a $1,000 Per Pupil Loss Cap Incentives ◦ Creation of more unit districts as opposed to dual districts ◦ Regional High Schools for rural areas of the state