Rep. France Clarifies MBR Definition and Improves Education Funding Formula

Posted on February 14, 2019 by admin


Facebooktwittergoogle_plusredditpinterestmail

Proposes New Legislation to the General Assembly

I have submitted House Bill (H.B.) 5243 and H.B. 6190 to the Legislature, which would correctly define the Education Cost Sharing (ECS) Minimum Budget Requirement (MBR) and better protect local Boards of Education (BoE) from confusion caused by Legislative or Executive Branch actions after local budgets are approved. In addition, I proposed H.B. 5180 to improve BoE fiscal management by allowing a reduction in MBR based on year-over-year reductions in certain special education costs, which can be a significant fiscal impact to our small towns.

Over the past 45 years, the legislature has taken several steps in an attempt to ensure all children have equal education opportunity, as well as to ensure equitable distribution of state education grant funds. Various court decisions since 1974 have caused the legislature to adopt the Guaranteed Tax Base (GTB) in 1975 and the Minimum Expenditure Requirement (MER) in the 1980s, and also led to the passage of the Education Enhancement Act in 1986. The current process of Education Cost Sharing (ECS) replaced both the GTB and Enhancement Act grants in 1988.

The MBR was enacted in 2005 and is calculated starting with the previous year’s total education budget and accounting for any new ECS funding – minus reductions allowed by statute to account for student population decrease, school closures or collaboration with other BoEs. It ensures that towns are spending 100% of their state education funding under the ECS formula for educational purposes only, by authority of the local or regional BoE.  However, just two years later, in 2007, following a substantial increase in ECS grants, there were a few towns that failed to provide this additional funding to the BoE and instead used it for general government expenditures. To ensure that ECS grants were used for their intended purpose of funding education, the General Assembly modified the MBR to ensure full allocation of ECS grant funds to local BoE budgets.

Actions by Governor Malloy to holdback $51 million in education funding following the passage of the current biennial budget in October 2017 provided indications of the flawed definition of MBR, the intent of which was to prevnt supplanting of local education revenue with state ECS grant funds. In addition, given the relative budget approval timelines, there was significant confusion on the part of many towns concerning the starting point for the following year budget. Fifteen towns and one regional school district received letters from the State Department of Education stating that they had violated the MBR which, if not corrected, would result in the local or regional BoE losing two dollars in future ECS grant funding for every dollar they were below MBR.

To correct these issues and provide greater clarity to local and regional BoEs during budget preparation, I have introduced the following three bills, which were all referred to the Joint Committee on Education.

First, H.B. 5243 would ensure that any holdback of ECS grant funds, such as was done by Governor Malloy last fiscal year, are properly accounted for when calculating future MBR eligibility. This would also include any future action by the Governor or the Legislature that reduces ECS grant funding after the start of a fiscal year.

Second, H.B. 6190 would redefine MBR as only the town appropriation and not include ECS grant funding, which will simplify the MBR calculation process. This would also ensure the original intent of MBR is met without the confusion of adding in the potential variance of ECS grant funding.

Finally, H.B. 5180 would allow an MBR reduction for certain special education costs. When a student no longer requires special education services due to graduation, relocation to another town or any other reason, the BoE budget would still be required to include the potential significant financial costs in their budget under the MBR. The BoE responsibility for special education costs includes the first 4-1/2 times the average cost for student education plus a percentage of the excess costs above that amount, which is generally 20% to 25% of that excess cost. The local BoE should get relief in their budget from these costs that are no longer required. I am hopeful that this will ease some of the financial burdens on the budget-making process and help our schools invest education funds on local priorities for their students.

Please consider contacting members of the Education Committee, including the Chairs and Ranking Members, at edtestimony@cga.ct.gov to support a public hearing and the bill being voted out of committee for consideration by the House and Senate.