Updated Oct. 1, 2019

After revisions negotiated in the State House, the House and Senate passed the 2019-20 School Aid Budget (HB 4242) and sent it to the Governor’s desk on Thursday, Sept. 19. The Legislature’s budget called for a total of $15.23 billion in preK-12 spending.  This is a 2.7% fund increase over FY ’19. The Governor’s proposal called for $136 million more and would have been a 3.4% funding increase.

Gov. Gretchen Whitmer averted a government shutdown at the end of September by signing a state budget sent to her on the eve of a fiscal-year deadline, but she used her veto pen to press Republican leaders in the state House and Senate to return to the negotiating table. The Governor used that pen to line-item veto approximately $128 million in the School Aid Budget.

Below is a breakdown of key sections of HB 4242, with line-item vetoes noted in italics.  More detailed information about the FY 2020 budget can be found in the House Fiscal Agency and Senate Fiscal Agency reports.  The agencies also created a document that estimates district-by-district impacts. A full list of line-item vetoes is also available.

Scroll down for additional information about the community college and higher education budgets. 

Per Pupil Foundation Grant

The budget raises the minimum per-pupil foundation allowance from $7,871 per child to $8,111 (a $240 increase) – districts getting the maximum foundation allowance will only see a $120 increase (with amounts in between increased through the so-called “2x” formula designed to close the gap between the top- and bottom-funded schools.  The Governor’s proposal included a smaller per child increase, but more money overall distributed through a new weighted funding formula (which the House and Senate did not pass).

The Governor vetoed $35 million of the Foundation Allowance Increase for Charter Schools.  

Great Start Readiness Program (GSRP)

The Governor’s proposal increased funding by $84.0 million for GSRP preschool for at-risk four-year-olds to pay for an increase in eligibility (changing from 250% to 300% of the Federal poverty level) and to increase payment for a full day of programming from $7,250 to $8,500.

The Legislature included only a $5.0 million increase and did not change eligibility or per-child payments to providers. The budget included a $350,000 study of GSRP’s effectiveness.

Special Education

The final budget included a $60.2 million increase for special education (2% increase) – $30 million of this is additional one-time money obtained through a deal negotiated this week by House Democrats. The Governor had wanted a $120 million increase (4% increase).

At Risk (Including Child and Adolescent Health Centers)

Legislature increased at risk funding by $5.0 million, and kept the formula in place as found in current law. In addition, they increased child and adolescent health centers funding by $2.0 million, from $6.0 to $8.0 million in this section. Total funding of $522 million ($97 million less than the governor’s proposal).

Career and Technical Education (CTE)

Legislature retained current law related to per-pupil payments, but increased those payments to a maximum of $100 per pupil (was $50), and increased standard CTE reimbursement under Sec. 61a by $1.0 million. The approved budget also increased grants for CTE equipment, from $2.5 million to $16.0 million (Governor had eliminated these grants in favor of a larger overall increase). Legislature also increased CTE early middle college funding by $2.0 million. Total CTE funding of $21.5 million ($33.5 million less than the governor’s proposal).

The Governor vetoed the $16 million for CTE equipment grants and the $2 million for CTE early middle college funding.

Literacy Coaches and Summer School for Literacy

The Legislature concurred in the governor’s proposal to triple the number of coaches, but retained local cost sharing (a $14.0 million cost to locals the governor proposed to eliminate). The Legislature added $15.0 million for summer school for 3rd grade reading.

The Governor vetoed the $15 million that the Legislature added for summer school reading.

English Language Learner Grants

Budget passed increased this from $6.0 to $13.0 million, and added another $3.0 million in one-time funding for capital expenses.

The Governor vetoed $3 million of the English Language Learner Grants.

Other highlights of the FY ’20 K-12 budget include:

* Cyber schools will continue to receive the full 100% foundation allowance payments. The Governor had proposed knocking that down to an 80% distribution formula. However, as noted above, increases for charter schools, including cyber schools, were vetoed.

* The Governor wanted to continue providing an additional $25 per pupil for high school students, but that didn’t make the final budget.

* The Legislature included $10.0 million total for School Security, with up to $3.8 million available for a panic button application if chosen by MDE and MSP. The Governor vetoed this $10 million.

* Also vetoed were $7 million for Small, Isolated School Districts and $1.6 million for Strict Discipline Academies. 

Boilerplate Language Changes from FY 2018-19:

(NOTE: Changes to language around partnership districts, at-risk and keeping out new language regarding shared time were achieved through House Democrat negotiations, in addition to the previously mentioned $30 million for special education.)

Michigan Public School Employees’ Retirement System (MPSERS) Retirement Obligation Reform Reserve Fund. The Legislature did not include a requirement in the Governor’s proposal to deposit $40.0 million from the School Aid Fund into the MPSERS reform reserve fund for 2019-20.

Partnership Districts. The Legislature retained language requiring partnership districts to comply with Sec. 22p to get their discretionary payment, but changed language to say that school closure was optional, rather than mandatory.

At Risk. There was an attempt to divert how schools spend their federal “at-risk” dollars – the first conference report approved last week would have required districts that didn’t meet certain academic targets to use their federal money to specifically address low test scores in 3rd grade reading, 8th grade math or wherever numbers were low. This was taken out through negotiations this week.

Professional Development as Hours of Instruction Guidelines. On the Governor’s recommendation, the Legislature is allowing districts to count up to 38 hours of qualifying professional development as hours of pupil instruction (this was allowed until FY 2014-15). This also allowed 10 hours to be provided before the school year begins or after the school year concludes. (Sec. 101)

Labor Day Waiver Hearing. The Legislature maintained a requirement that a district or ISD applying for a pre-Labor Day start waiver must have a public hearing before the waiver is granted, but it strikes a requirement that MDE participate in the public hearing. (Sec. 160)

Disciplinary Policy for Abortion Referral. The budget maintains a requirement that districts and ISDs must adopt a disciplinary policy for abortion referrals, but removed financial penalties that previously applied. It also added that a parent or legal guardian of the pupil is exempt from the policy. (Sec. 166)

Shared Time. The original conference report had language to expand public schools’ “shared time” offering with private schools and home-schooled students, after nine schools were flagged through a Department of Education (MDE) audit of overly expanding their “shared time” program with private school and home-schooled students. This language was removed and now the amended conference report maintains current law.

Regarding Community College and Higher Education Budgets

The Legislature also approved conference reports on FY 2020 budgets for community colleges (SB 134) and higher education (HB 4236) and sent them to the governor, who signed them into law with some line-item vetoes in the higher education budget. Detailed analysis is available for both the community college and state university budgets, but highlights include:

Community Colleges. The Legislature approved a 1.6% increase from current spending (Governor had proposed a 3% increase). For operations through the formula, it was an average of a 0.8% increase. An additional average of 0.2% was put in to cover the Indian Tuition Waiver funding. The conference report also adopted changes to the formula that reduces weighted contact hours by 5% and replaces that with a new metric benefiting six northern community colleges with lowest taxable values from FY 2017-18. There were no line-item vetoes in the community college budget.

Universities. The Legislature approved a 0.9% increase from current spending (Governor had proposed a 3% increase). The Operations funding was around a 0.5% average with funds to fully fund the Indian Tuition Waiver Grant program being around an additional 0.5%. The conference report reduced the School Aid Fund dollars used by $151.1 million (as opposed to the Governor’s proposal to full elimination of all $500.2 million in SAF money spent on higher education).  The Governor vetoed $38 million in Michigan Tuition Grants.