A new funding proposal for Colorado’s public schools is on the table. It attempts to strike a balance between the need to boost funding K-12 funding and the need for state lawmakers to slash $1.2 billion from the overall state budget. But nothing is set in stone yet, and many of Colorado’s 178 school districts are still vetting the latest proposal from House Speaker Julie McCluskie.
The past few weeks — punctuated by a teacher rally Thursday that drew 2,000 people — have been a mad scramble to come up with a compromise school finance plan that folks can live with: school districts, Gov. Jared Polis, Rep. McCluskie and other lawmakers.
The yearly ritual of drafting the School Finance Act, which lays out how much schools will get for the next school year, has been particularly challenging this year because of the amount lawmakers must cut.
Speaker McCluskie has been fashioning an alternative to Polis’ school funding proposal. While his plan would increase per-pupil funding for schools, it would change the way students are counted. Some school districts are concerned that it could cost schools $150 million. The governor argued that the money saved from that $150 million will be funneled back into a new funding formula for schools passed by lawmakers last year.
The proposal would switch from counting students based on a rolling 4-year average to a single year count. Some school districts argued that would be too much to absorb in one year, especially for districts with declining enrollment. Jefferson County would see a $20 million hit in one year. Adams 12 Five Star Schools would face a $13 million cut.
McCluskie released her latest proposal Tuesday. It tries to lessen the shock to districts by lengthening the time school districts have to move away from averaging and setting clear targets for implementing the new funding formula. The new formula is aimed at eliminating inequities between school districts. Over seven years, it’s expected to add $500 million more to school coffers.
“It's helping to stabilize funding for school districts,” said McCluskie of her plan. “Obviously we want a stable workforce, and so being able to count on funding year to year, even if you're losing students — taking a kind of a glide path when you're in that environment — helps cushion the blow and helps districts make the right decisions.”
Her plan would implement 15 percent of the new formula next year, with schools hanging onto the four-year averaging way to count students. If 30 percent of the new formula is implemented in the second year, the state would fund schools based on a three-year average student count. In the third year of the new formula, 45 percent would be implemented as long as other conditions are met.
Some districts have already lined up to back the plan
“It will definitely benefit District 6 and other districts with similar demographics to ours,” said Superintendent Deirdre Pilch of the Greeley-Evans School District 6. “The new formula drives more money into school districts with high concentrations of students living in poverty or who have lots of English language learners.”
“When you're in a system where poverty is significantly dense like it is in our system, kids need more, families need more, teachers need more,” she said. “The needs are far greater than in the system that is not impacted as greatly by poverty.”
She said her district supports food pantries in every building, laundry facilities in many schools, after school programming for all students, and sometimes two teachers in a classroom for English language learners.
“They need that additional support to get access to grade-level content,” she said.
The nonprofit Colorado Children’s Campaign also supports the latest proposal, stating that it will deliver bigger, more predictable and sustainable increases to public education. Madi Ashour, the organization’s director of K-12 education, said implementing Colorado’s first new school funding formula in three decades would be a massive victory.
“Just that shift alone to kids who need more resources, that is a big win and a big step toward equity,” she said.
She said the goal of McCluskie’s proposal is that no district will see a reduction in the amount of funding that they get from the state next year.
But that doesn’t mean some districts won’t have to cut.
While the new funding plan shows the Greeley district getting a 4.5 percent boost in funding next year, most districts like hers are experiencing inflationary levels for utilities and health insurance much higher than the inflation rate set by the state. Supt. Pilch said she’d still need to cut $7 million for next year. Before this proposal, the amount was more like $20 million.
“Seven million is a lot more palatable than $20 million out of our annual budget.”
Pilch said long term the new funding plan will allow her district to keep counselors at high schools, parent liaisons and possibly lower-class sizes.
Will districts with declining enrollment back the proposal?
While Pilch supports the new plan, she is sympathetic especially to smaller, rural districts that are losing students and that may be hurt by the eventual disappearance of the averaging method of student count. McCluskie’s proposal doesn’t specify when that would actually happen.
Bret Miles, executive director of the Colorado Association of School Executives that represents superintendents, said the overwhelming majority of school districts want to see the new school finance formula implemented. But he said districts are still analyzing the impact of McCluskie’s proposal.
“In the meantime, we appreciate the work of the Speaker and her effort to find potential solutions to our feedback,” he said. “We are always glad to work with her and are pleased with her continued willingness to collaborate.”
Tracie Rainey, executive director of the Colorado School Finance Project, said there are many other pieces to school funding outside the proposal that need to be factored in to fully understand how much schools would be losing or gaining.
She added that under McCluskie’s plan, as schools move away from “averaging” in the 2026-27 school year, “that cliff that they hit becomes more dramatic.”
“Districts would have some time to plan, potentially,” Rainey said. “But it could also be anywhere from a 20 to almost 40 percent reduction for some of the districts depending upon their enrollment numbers.”
She noted that under the proposal, high poverty districts like Pueblo 60 and Sheridan are expected to see no increase in funding next year.
“Is that more equitable?” Rainey asked.
Even as state lawmakers struggle to find a sustainable funding plan for this year, recent studies show that Colorado is underfunding schools by $4 billion. Ashour, with the Colorado Children’s Campaign, said the state is hamstrung by constitutional spending restrictions in the Taxpayer’s Bill of Rights.
“We need $4 billion more dollars in public education each year, but under TABOR we can't make that happen.”
