Revamp of special-ed funding formula goes nowhere

Arizona’s formula for funding special education will be at least 40 years old before it is adapted to reflect the effects of school choice.

The Legislature was presented with a bill to do just that this session, but it died.

The formula in place does not account for the movement of students out of their traditional district boundaries, and funding intended for students with special education needs is no longer adequate – if it ever was.

And it is not so much the students receiving special education services who ultimately suffer – their general education peers do.

Sen. Heather Carter, R-Cave Creek, sponsored SB1522 to establish new base funding rates and weights beginning in the current fiscal year 2019, including an appropriation of $3 million in that year for the Extraordinary Special Education Needs Fund.

But the bill was not heard in either the Senate Education Committee or the Senate Appropriations Committee.

Chuck Essigs, director of government relations for the Arizona Association of School Business Officials, said the idea itself did not lack support. He was told the Legislature simply had too many other priorities this session.

The House has advanced a bill to establish a study committee on special education weights and funding for gifted students. That proposal, which was unanimously approved on February 27, would require the committee to produce a report with its findings and recommendations by January 1, 2020, which Essigs said would leave plenty of time for someone to introduce another bill to adjust the inadequate formula.

Still, there’s no guarantee that will happen.

And Essigs said promises to take action later are not enough.

“By saying it’s too complicated to solve this session, that takes a lot of the wind out of the sails of trying to move it forward,” he said.

A FORMULA OF THE PAST

The formula currently used to dole out dollars for special education services was implemented in the 1980-1981 school year, allotting one level of additional dollars to all students with no consideration as to the number of students who actually require special services.

Districts with at least 1,000 students receive funding for each pupil under either Group A or Group B weights. Group A funding, which works out to about $600 per student, is designed to support programs for the gifted students and kids with specific learning disabilities, speech impairments and emotional disabilities, among others.

Two school districts each with 1,000 Group A students receive the same amount of funding even if one has a higher need for special education services than the other. That leaves the latter district with additional funding that can be put toward other costs while the school with the greater need is left with a deficit.

That’s the core of the formula’s problem, Essigs said. Students are no longer evenly distributed and neither are the dollars intended for special programs.

In contrast, Group B funding follows a specific student directly and is more significant to account for the cost of more robust services for visual or hearing impairments, autism or students with multiple disabilities. But the amount of Group B funding provided has not been updated to reflect costs.

The old rationale for the weights was simple: Students attended their neighborhood district schools – evenly distributing students at every level – and the state wanted to deter districts from over-identifying students in need of services just to pick up extra cash. But much has changed since then.

The state has opened up hundreds of charter schools, issued thousands of school vouchers to be used at private and parochial institutions and embraced a school choice environment that does not limit students to their district boundaries.

Jim Swanson, an Arizona businessman tapped by Gov. Doug Ducey to head his Classrooms First Initiative Council, said both the state and federal government fall short of funding the true cost of special education. And the gap is widening.

The gap between the level at which those programs are funded and their true cost was estimated at about $400 million in 2017, he said. Where it stands today is unknown, because in addition to failing to update the formula itself, the state has not conducted a cost study since 2007.

Carter’s bill would have also required the state auditor general to conduct an audit and cost study of districts’ special education programs.

“If we funded [special education] appropriately and for the true cost, you would put more money in the rest of the classrooms and solve some of the other problems we have [in public schools],” Swanson said.

The problem will only be exacerbated the longer the state waits to do something about it.

But students receiving special education services are not the ones who ultimately suffer. Their general education peers do.

FIRSTHAND EXPERIENCE

John Carruth, Superintendent of Public Instruction Kathy Hoffman’s chief of staff, has seen the need for an update firsthand.

Before joining Hoffman’s staff, he was a special education teacher and director in the Vail School District.

The need for funding to provide meaningful services to his students cut into regular education needs, he said. Class sizes were affected. The ability to hire specialists was affected. And salaries across the board were affected, perhaps most of all.

His district chose not to fund full-day kindergarten to ensure students’ special needs were appropriately covered, he said. In essence, the district created its own rough formula.

And most schools are doing much the same, he said – dipping into their general funds for classrooms to provide for students with special needs. Providing those special services is non-negotiable.

“That feels like it pits kids against each other, but it’s not,” Carruth said.  “But it impacts kids throughout the system.

“We valued the need to provide high-quality services for the students who had special needs because that really sends a message about who you value overall.”

The state is sending its own message, one that has veteran special education teachers like Jeff Fortney frustrated year after year.

Fortney couldn’t fathom why Carter’s bill got no hearing.

“What is the problem here?” Fortney said.  “The Legislature has no problem moving forward with bills that aim to take money out of public schools, but they kill the bills that actually are trying to [find a solution].”

Fortney has been teaching students with special needs for 15 years, currently at Mirage Elementary School.

He has been with several other districts and even a charter school for a time, but what he experienced was always the same, he said: Adequate resources were not available.

That meant going without dedicated curriculum or sensory devices for students with autism.

The difference is made up somewhere, through generous staff and families.

One parent has been especially eager to help this year, buying all sorts of things for several of Fortney’s students, he said. Every few days, she brings in a new book or puzzle to engage the kids.

People like her mean well, but he said the responsibility of providing those materials is not hers.

“I get it because you want them to have it. But it also propagates the problem,” Fortney said. “If we could just say to the district that we need these resources, she wouldn’t have to do that.”

IMPERFECT SOLUTIONS

Part of the trepidation to update the formula comes from the fact the potential solutions may be politically imperfect.

Essigs said the state could opt to only give additional funding to students with special needs. But that option creates “losers” – districts and charter schools with few students needing those services. The “winners” in that scenario would be schools with more students with special education needs.

And that potential system of winners and loser tends to stall the conversation around an updated formula, Essigs said.

To prevent that scenario, the state could also opt to keep Group A funding and increase the Group B bucket that allocates additional dollars to students with specific needs to directly fund those specific services. That option wouldn’t create any losers, but Essigs said it would cost the state a lot more money. That is also likely to stall out in the Legislature because it gets at the core debate about how much funding for public schools is truly enough.

Ultimately, Swanson said, there is a will to do something – not just for special education but the public education system as a whole.

The question is when and how will the state finally take action.

“I don’t think that people want to kick the can down the road,” he said. “But there are so many forces on the political side that I can’t say what will happen.”

Reporter Ben Giles contributed to this report.