July 9, 2021 -- On Thursday, July 1, Governor Mike DeWine signed into law the State of Ohio’s budget for 2021-2023. The new budget makes the Fair School Funding Plan (FSFP) the basis for Ohio’s new K-12 school funding formula.
The FSFP calculates state aid with a formula of 60% property taxes and 40% household income, factoring in a community’s economic status and a district’s number of higher-need students. The CH-UH City School District has been advocating for its passage for several years, and we thank the many parents, staff, students and community members who have reached out to lawmakers right alongside us. Although there are wrinkles to be smoothed, this is an encouraging development for public schools like ours.
Below, we address some of the questions we’ve received from stakeholders.
Will vouchers now be fully funded by the state instead of deducted from school districts like CH-UH directly?
Yes, the funding will come directly from the state and not as a deduction from local school districts. Our school district and supporters have been advocating for years that EdChoice voucher funds come from the state rather than the “deduct model.” However, other changes in the new funding formula wouldn’t be phased in until at least year six (and pending available state funds and future legislator approval), so this does not result in a financial windfall for districts and is not guaranteed. The short term financial impact for CH-UH is minimal, but the long term fiscal impact is promising.
How will the new school funding formula affect CH-UH’s amount of funding received from the state?
With voucher deductions out of the equation, the new funding system for students who actually attend our schools will be phased in over 6 years, and simulations provided by Ohio’s school business professional organizations indicate CH-UH will receive an additional $2 million in year one (21-22 school year) and an additional $1.3 million in year two (22-23 school year) over our current funding after the losses from voucher deductions are accounted for. The detailed amounts will be provided by ODE in October, and future increases past the 22-23 school year as intended in the 6-year phase-in will depend on future legislatures who will determine the next two biennial budgets.
Essentially, the plan is only funded for two years, not six as originally intended. And instead of getting the entire annual voucher deduct returned, we’ll gain $2 million in the first year.
Would the District now be in a comfortable place to cancel any of its tax levies?
No, because we are not gaining the savings as intended. The Board has stated previously that if vouchers were paid directly by the state and if funds lost were returned to the District, we could conceivably reconsider our current levy needs. In the new formula, the voucher payment deduction from local school districts has been eliminated, but so has the entire amount of district state funding that was previously used to cover the voucher deduction. Instead, the state has created a new funding system that will be phased in over six years (assuming future legislatures agree to do so over two additional state biennial budgets) which does not provide significant increases to our district over the next two years.
The Ohio Department of Education will have the new funding plan implemented for the current year by October and we will provide a comparison as the details are shared with us.