Michigan Legislature passes state school budget with more at-risk funds

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Michigan state lawmakers passed a $23.4 billion state school budget on Thursday, providing more funding to support low-income students, English learners, mental health and expanding free preschool.

Some supporters said the budget is a win for vulnerable student groups — and builds on previous progress in more equitable funding for Michigan’s schools — but it does not include an increase in the minimum per-pupil funding, which educators fear could lead to cuts and layoffs at schools across the state. It does, however, provide some savings to school systems by reducing the amount they must pay into the pension system.

“Overall, the budget this year is tighter than in recent years,” said David Arsen, professor emeritus of education policy and K-12 education administration at Michigan State University. “But this budget continues the progress.”

The base amount of per capita funding remains unchanged at $9,608 per student.

Lawmakers and Gov. Gretchen Whitmer said the pension savings for districts would offset the flat-rate per-pupil spending.

The budget includes $589 million to offset districts’ payments to the Michigan Public School Employees Retirement System, saving districts about $400 per student, according to the governor’s office.

“The amount associated with the reduction in districts’ MPSERS obligations increases the discretionary funds available beyond the amount included in the executive’s recommendation for the per-pupil increase,” Arsen said.

With the additional funding, Arsen said, it’s unlikely that districts will have to make cuts to budgets they already approved based on the governor’s original proposal. But individual districts, particularly those with declining enrollment and those that have used COVID relief funds for ongoing costs, will face challenges, he added.

Previous plans by lawmakers to drastically cut funding for school safety and student mental health services were not implemented in the final agreement. School leaders expressed shock at the potential plan on Wednesday, saying the cuts, which come as federal COVID relief funds expire, would likely lead to layoffs of counselors and other mental health staff.

The final budget increases funding for school safety and student mental health support by $25 million, bringing the total available for the next school year to $133 million.

The budget also allocates a total of one billion dollars for programs to support students from low-income families – the largest amount ever allocated for such programs.

The money will be distributed to districts through the state’s “opportunity index,” a funding formula introduced last year that awards more money to districts serving communities with higher concentrations of poverty. Previously, the same amount per student was given to students deemed “at risk” by the state.

“Additional investment in the Opportunity Index is critical to righting the wrongs of the past and ensuring that Michigan’s neediest students – Black and Latino students, students from low-income families, English learners and students with disabilities – have every opportunity to reach their highest potential,” Alice Thompson, chair of the Detroit branch of the NAACP’s education committee, said in a statement.

For years, advocates have called on lawmakers to make education funding more equitable in Michigan. Historically, the state has had some of the worst funding gaps between poor and wealthy communities.

Groups like Education Trust-Midwest have called on lawmakers to allocate a total of $2.9 billion in additional funding through the Opportunity Index to at-risk students over the next five years.

The law allows districts that receive the funds to use up to 30% of the money to reduce teacher-student ratios in grades K-3. Some schools can use an additional 30% for teacher recruitment and retention.

Ed Trust-Midwest has advocated for the state to be more transparent and for districts to be more accountable for how they use at-risk funds.

“This was a missed opportunity,” said Mike Jandernoa, chairman of the Michigan Partnership for Equity and Opportunity, a coalition that advocates for equitable school funding. “It is critical that the state create a strong new transparency system for increased Opportunity Index spending. That includes ensuring that funds intended for the neediest students actually reach their schools.”

A recent analysis by the Citizens Research Council of Michigan found that despite increased funding for at-risk students in recent years, only 55 percent of the state’s largest school districts had an equitable distribution of state funds per student.

Support for English learners was increased by 26%, totaling $50.2 million. Supporters said this builds on progress lawmakers made last year, when the budget for English learners was increased by 90%.

Despite the progress made last year, Michigan still ranks among the worst in the country compared to other states in terms of the percentage of funding allocated to supporting English learners in 2023, according to Ed Trust Midwest.

Although the budget allocates $130 million to investing in expanding free preschool education – which will then be offered nationwide in the state two years earlier than previously planned – the goals set out in the governor’s proposal are still not achieved.

The funds will provide care for approximately 5,300 additional four-year-olds, open new classrooms in underserved areas, fund student transportation and increase the per-child allotment for full-day preschool attendance to $10,185.

The legislation does not take into account advocacy groups who had warned that languages ​​would force the closure of early child care programs.

A previous House budget bill would have eliminated the provision that ensured that 30% of funding for the Great Start Readiness Program, the state’s free preschool program, would go to municipal or private providers. A previous Senate bill would have required private GSRP programs to pay at least the average salary of other GSRP teachers in their area.

The budget also funds free community college admission for all Michigan residents.

The budget includes $50 million in one-time funding for ongoing afterschool and summer school programs and provides another $25 million in one-time funding. The advocacy group Michigan Afterschool Partnership estimates the funding will benefit 75,000 youth this year.

Other highlights of the budget include continuing free breakfast and lunch for all public school students (K-12) and continuing to reimburse districts for transportation costs.

The approved school budget will now be sent to the governor for signature. She can reject parts or the entire bill.

The final budget will come into force on October 1.

Hannah Dellinger covers K-12 education and public education policy for Chalkbeat Detroit. You can reach her at [email protected].