Article courtesy of MIRS for SBAM’s Lansing Watchdog newsletter
Legislators took another step toward a weighted school funding system that directs more money to poor, special education and English-as-a-second language students under a Fiscal Year (FY) 2027 spending plan passed Friday morning.
The budget marks another step away from Michigan’s traditional one-size-fits-all funding model and toward a system in which dollars increasingly follow student needs rather than simply enrollment.
Under the omnibus education spending bill, (School Bus) HB 5630, and its companion bill, SB 903 sponsored by Senate K-12 Appropriations Subcommittee Chair Darrin Camilleri (D-Trenton), districts will receive larger funding increases for students with greater educational needs, including poor students, English learners and special education students.
In the ’27 budget, $1.7 billion is being injected into a special pot for districts with higher levels of poor students and students who are not native English speakers, a $258.7 million increase from last year.
“This is a massive investment in our kids who need it the most,” Camilleri said. “These are kids that are not just in urban school districts. These are rural school districts as well, as well as suburban. This is across the board. Our school leaders have wanted this because they know that every kid has different needs and supporting those kids is going to cost a different amount of money.”
The House passed the School Bus, 99-8. Those voting no were Reps. Steve Carra (R-Three Rivers), James DeSana (R-Carleton), Joseph Fox (R-Fremont), Jaime Greene (R-Richmond), Veronica Paiz (D-Harper Woods), Dylan Wegela (D-Garden City), Regina Weiss (D-Oak Park) and Jennifer Wortz (R-Quincy).
From a total dollar standpoint, the budget is $19.8 billion, $1.5 billion less than the current year FY ‘26 budget. Roughly $1 billion of the reduction is largely an accounting change. The budget no longer assumes $500 million in federal revenue for school meals and another $500 million for special education, instead directing state officials to seek “all available federal funding.”
The move is not a considered a “hard cut.” Rather, it readjusts the budget to what the state is expected to need and spend from the federal government as opposed to what it is authorized to spend, an approach change pushed by House Speaker Matt Hall (R-Richland Township) and House Republicans.
Senate Appropriations Committee Chair Sarah Anthony (D-Lansing) said they have no indication that this money would not be available from the federal government, if needed.
Asked whether the accounting change was designed to make the budget appear smaller, Anthony said, “There’s one person in this building who likes to demonstrate that the budget is smaller. We were not focused on a talking point. We were focused on making sure that people had the resources they needed in the budget.”
Schools under this budget will receive $250 more per pupil, from $10,050 to $10,300. The budget also uses a three-year enrollment average to determine how many students a district is considered to have.
“By increasing classroom funding across Michigan to $10,300 per student, the highest level in state history, and maintaining funding parity for cyber school students, we ensure we’re paving the same path to success for every child,” said Rep. Nancy DeBoer (R-Holland) in her floor speech. “Under this plan, students will learn how to read, and because of that they will be able to read to learn.”
The budget and a pair of companion bills (HB 5646 and HB 5697) also steer teachers to be trained in a phonics-like method called LETRS, or the Science of Reading. Funding for this training was bumped from $50 million to $75 million.
“I like a lot of things about this budget,” said House K-12 Appropriations Committee Chair Tim Kelly (R-Saginaw). “I think we’ve got a lot of good stuff in there. I like the investments in reading. I like the tutoring. I think it’s a very cooperative budget.”
Kelly estimated that about half of the “School Bus” was worked out between himself and Camilleri while the other half was kicked up to the leadership level to work out.
Other highlights of the School Aid Budget include:
- The significant paring back of one-time earmarks, pilot programs and special initiatives. Many are being reduced if not completely eliminated, a sign that COVID-era injections of funding are over. Examples are eliminating $65 million for a small class size pilot and $25 million for a 3-year-old pre-school program.
- Cyber schools will be funded at the same $10,300 per pupil as traditional schools
- The Detroit Public School Community District will no longer receive a special $124 million allocation under the budget and a companion bill, HB 6130
- An extra $150 million to boost teacher pay
- An extra $50 million for “high-impact tutoring”
As for the Higher Education budget, universities are receiving a 1% funding increase with $630.9 million coming from the School Aid Fund. Under this budget, more money ($1.48 billion) is coming from the SAF than the General Fund ($1.12 billion), a marked shift in policy that Camilleri said was necessary due to the cuts in the General Fund budget.
When the state’s $1.75 billion university appropriation is run through the funding formula, Lake Superior State University makes out the best with a 1.6% increase. Northern Michigan University ends up with a 1.4% increase and Central Michigan University sees a 1.3% increase. Michigan State University and the University of Michigan-Ann Arbor receive a .9% increase, the lowest increase.
The Higher Education budget also:
- Expands the Michigan Reconnect program to residents ages 21 to 24 by providing last-dollar scholarships. Traditionally, only those 25 years and older qualified for the program.
- Removes $50 million in one-time funding for the phase out of the Michigan Competitive Scholarship and Tuition Grant programs.
Community colleges also receive a net 1% increase from last year, which when run through the formula means the 28 schools get anywhere from a .3% cut (Alpena Community College) to a 2% increase (West Shore Community College).
The Community College budget also sets aside $3.5 million for the Michigan Maritime Manufacturing Initiative, a program that primarily assists Macomb Community College in teaching students how to build boats and submarines.
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