ACTION ITEM: ISTA Response to House Republican Budget

Statement on the House Republican Budget Presentation 2014-15


ISTA recognizes that the House Republicans increased funding to K-12 education from the Governor’s original proposal and looks forward to continuing its work with the House Ways & Means Committee and the House of Representatives on school funding.

Because of some of the changes inside the funding formula, the 2% and 1% new money figures are not exactly comparing apples to apples from one year to the next. 

With an over $2 billion surplus today and an over $2 billion surplus projected in FY2015 after implementing this budget proposal, with a positive revenue forecast, with several new government obligations coming out of the House Education Committee to expand private school vouchers (HB 1003-HB 1004), to expand tax credits for private school parents and homeschooling parents (HB 1003), to provide a 14% increase in virtual education funding (HB 1338); ISTA respectfully asks the House to consider additional assistance for Indiana’s community-based public schools—the schools where the parents of about 1 million Hoosier students seek their children’s learning opportunities.

It must be noted that the proposal offers:

(1)    no new funding for textbook assistance (straight-lined since 2008),

(2)    no new funding for remediation programs to help students identified through standardized testing as needing additional assistance (Indiana provided a sum total of $2.9 million statewide in 2012 for all of K-8 remediation),

(3)    no new funding for early intervention/reading programs,

(4)    no funding for professional development for teachers, and

(5)    no new funding for English language learner programs (Indiana provides $95 per student even though the budget calls for $200 per student—the amounts are reduced due to demand exceeding the appropriation).

ISTA is in the process of reviewing all the details of the budget and formula run and how they affect each district…much more information to follow.

In the meantime, please contact your Representative to urge augmentation to this proposal to benefit Indiana’s public school children.


·         K-12 Funding is increased by 2% in CY 2014 and 1% in CY 2015.

·         FDK is now added to the funding formula calculation.

·         FDK used to be a separate categorical grant outside the formula and was not counted in the formula % increases. 

·         Under this new House Republican proposal—the amount being included in the formula for FDK is $189 million as a base—and is being reflected as being “added” to the bottom line as new money—but this is not all new money (some of it is money being counted differently). 

·         Primetime funds (over $117m in 2013) inside the formula are eliminated altogether.

·         Increasing the state’s foundation level is a positive component especially if the overall appropriation is sufficient to fund students—but two things should be noted:

o        The foundation amount was $4825 in 2009 and under this proposal, is projected to be $4575 in 2015—still $250 per student less than 2009 levels.  The effects of the cuts in 2010 are lasting.

o        The budget adds the following funding components to what already is applied against the FY cap—which serves to trigger a pro-rata reduction to all school districts if the appropriation is insufficient to fund the obligations:

§         private school voucher distributions;

§         the Mitch Daniels early graduation scholarships; and

§         the FDK grants.

·         Complexity index dollars (dollars that are there to help Indiana’s most challenged students) show an increase under this proposal. 

o        However, the manner in which complexity dollars are calculated changes in the proposal from students who qualify under the free- and reduced-price lunch program to students who qualify for free textbooks. 

o        Analysis is being done to determine the effect district-by-district.

·         Special Education per student amounts are straight-lined once again (no increase).

o        The last time special education per student grants were increased was 2008.

·         Career and Technical Grants per student amounts are straight-lined for two years once again.

o        The career and technical grants per student amounts have never been increased since their inception in 2003.

·         Adds to the list of funds that will count against the state’s fiscal year cap—which triggers the proportional reduction to all school districts in the event the appropriation is not sufficient. 

·         The formula run contemplates a 34% increase in private school voucher distributions (FY2014) and a 26.1% increase in voucher distributions (FY 2015).

·         The formula run suggests a $15 million increase in expenditures to fund new charter schools each of the next 2 years.

Selected Other Provisions in the Budget

Provides $16.7 million in performance awards for certain school districts.

Gives the Education Roundtable control of and funding for the following new initiatives and funds:

·         Indiana Works Council:                                                  $1 million (2014) and $5 million (2015)

·         Dropout Prevention:                                      $6 million (2014) and $6 million (2015)

·         STEM teacher recruitment grant fund    $5 million (2014) and $5 million (2015)

·         Innovation Fund                                               $2.5 million (2014) and $2.5 million (2015)

Makes school funding a fiscal year distribution (rather than CY) and uses the 2nd formula count to alter certain funding and gives the SBE certain power to adjust student counts (ADM).  

Virtual schools are entitled to receive career and technical grants, academic honors grants, complexity grants, and FDK grants.

Contemplates a 13th check to TRF retirees; not a bona fide COLA.

The proposal still offers the automatic taxpayer rebate and:

·         Leaves $1.9 billion surplus at FY2014 end (12% of projected budget); and

·         Leaves $2.1 billion surplus at FY 2015 end (almost 14% of projected budget)