The regular legislative session adjourned at midnight on May 31. Unfortunately, while numerous budget bills were introduced, not a single budget bill passed both chambers of the General Assembly before adjournment. Below are two such budget bills, one that contained only appropriations for K-12 education, the other for full state operations.

Legislators will continue working on budget issues over the coming weeks. Speaker Madigan (D-Chicago) indicated that the House of Representatives will be in session each Wednesday in June and continuous session throughout the summer.

In addition, we have also provided an overview of the education funding formula bills introduced this year and their current status. We expect discussions on revising the school funding formula to continue into the summer and fall.

We will provide a final status update on other education bills next week and continue to provide updates while the General Assembly continues to meet.

1Education Budget and the State Operating Budget

SB 2990 (Cullerton, D-Chicago/Madigan, D-Chicago) is a stand-alone K-12 education budget that passed the Senate but failed to pass the House of Representatives. This bill provided $5.4 billion in General State Aid (GSA) and an increase in early childhood funding. The bill also contained the full pension contribution of $3.9 billion for the Teachers’ Retirement System (TRS) as certified by the TRS Board of Trustees.

A full state operating budget was introduced in SB 2048 (Cullerton, D-Chicago/Currie, D-Chicago), which in addition to all other state operations, included funding for K-12 and higher education. This bill passed the House of Representatives on a vote of 60-53-1 but failed to get the required number of votes in the Senate.  Specific to K-12 education, the bill appropriated more than $5.4 billion in GSA funding, an increase of more than $760 million, as well as an additional $75 million in early childhood education funding. The bill also contained funding for higher education at slight reductions from FY15 levels. Higher education institutions were reduced by approximately 6 1/2 percent from FY15, higher education agencies were reduced by approximately 5 percent and MAP funding was increased.

2Continuing Appropriations Remain Intact

While the General Assembly did not pass a budget bill, it is important to note that other legal provisions will allow Comptroller Munger to meet some FY17 obligations including, but not limited to, pension, retiree health insurance and bond obligations of the State. Annuitants of TRS, IMRF or SURS will receive their monthly annuities regardless of whether a budget is in place on or after July 1.

Important FY17 Continuing Appropriations:

  • Teachers’ Retirement System (TRS) – $3.9 billion
  • State Universities Retirement System (SURS) – $1.7 billion
  • Teachers’ Retirement Insurance Program (TRIP) – $110 million

3School Funding Reform Model

During the last ten days, we saw two new bills, in addition to SB 231, that would substantially reform the school funding formula. We expect discussions on revising the school funding formula to continue into the summer and fall.

SB 231 (Manar, D-Bunker Hill) is a continuation of Senator Manar’s efforts to make fundamental changes to school funding. Previous efforts included SB 16 in 2014 and SB 1 in 2015. The major goal of the legislation is a more equitable distribution of state resources, driving funds first toward school districts with the fewest local resources. This bill would combine current funding from GSA, bilingual education, special education summer school, special education personnel, special education funding for children requiring special education services and special education orphanage (for foster students only) into a single weighted student Primary State Aid (PSA) formula. Funding for other Mandated Categorical line items would remain as reimbursement programs and the block grant for the City of Chicago would remain in place.

Distribution of funding through the PSA model would be based on a district’s ability to raise local resources and would provide for additional funding for numbers of low income, gifted, English learner, special education students, etc. The foundation level would be set in statue but could fluctuate based on the appropriation for PSA in a given fiscal year. The bill includes hold harmless provisions for districts that would lose money because of the change, which would be phased down and out over a set number of years. If passed and signed by the governor, the new funding formula provisions would go into effect in the 2016-2017 school year. The Senate passed this bill on a vote of 31-21-3 and it was assigned to the House Executive Committee.

HB 828 (W. Davis, D-East Hazel Crest) contains language to create an “evidence-based” school funding model beginning in the 2017-2018 school year, which would base funding on best practices that have been determined to show improved student learning (reduced class sizes, use of technology, school counselors and other support personnel in appropriate ratio to student populations, etc). This bill was initiated by the Illinois Statewide School Management Alliance as part of their Vision 20/20 efforts. This model would create a foundation level based on each district’s characteristics that is then adjusted for local wealth. School districts would be placed into different “tiers” based on how closely they are to being adequately funded, as defined in the bill. School districts in Tier One would receive the bulk of any new appropriation because they represent the districts furthest away from being adequately funded. This proposal would combine the current funding for GSA and several of the Mandated Categorical line items to create the base funding. The rest of the Mandated Categoricals, like transportation and special education private tuition, would continue to be funded on a reimbursement basis for all districts. HB 828 is in the House Rules Committee.

HB 3190 (Lightford, D-Westchester/W. Davis, D-East Hazel Crest) and HB 829 (Currie, D-Chicago) seek to create a new funding formula by combining SB 231 and HB 828. The bill provides that for the 2016-2017 school year, school districts would be funded based on the formula outlined in SB 231, which would then set the base year funding. For 2017-2018 and subsequent school years, school districts would be funded using the “evidence-based” approach in HB 828. HB 3190 passed the Senate on a vote of 31-18-8 and was assigned to the House Executive Committee. The language for HB 829 was filed but not heard in a committee.