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New Spec.-Ed. Funding System in Vt. Could Set Precedent, Experts Predict

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By Debra Viadero

A new special-education funding system approved this month by Vermont lawmakers could set a precedent for other states, experts in the field said last week.

The new funding system seeks to address two concerns about special education that are becoming increasingly prevalent in a number of states, analysts noted.

Its goals are to contain the growth of special-education costs, and to move away from "labeling" disabled children and do a better job of integrating them into regular public-school classrooms.

"With the cost of educating handicapped kids at two-and-a-half times the average cost of educating other students, states are feeling pretty strapped in terms of their ability to pay for those services," said Kent McGuire, an assistant professor of education at the University of Colorado.

"There is the feeling--if not the reality--that those 10-to-12 percent of kids are siphoning money away from the vast majority," he added.

Counting Children

Such concerns came to a head in Vermont a little more than two years ago, as the state experienced a dramatic rise in spending for special education. Policymakers embarked soon after on a prolonged effort to address those concerns by overhauling the state's special-education system.

The funding-formula change approved by the legislature this month may be the most radical shift to result from that effort so far, state officials explained.

Under the new system, the state will distribute special-education block grants--which provide roughly a third of state special-education funding--to school districts on the basis of their total student populations. Under the previous system, such aid has been based on the num4ber of students with disabilities in each district.

"There was a feeling that the old formula provided an incentive for school districts to count more special-education students," said Representative William B. Talbott, a Democrat and former co-chairman of the state commission that initiated the reforms.

One sign of the possible overidentification of students, state education officials said, is the wide disparity in the proportion of disabled students reported by different districts. Margaret Schelley, a budget coordinator in the state department, said the percentages range from about 5 percent of students in some towns to more than 20 percent in others.

The new formula requires districts that identify a below-average number of disabled students to use their extra money for remediation and other strategies designed to help students stay in the regular classroom, rather than being labeled as handicapped.

Instructional-Support Teams

To further that goal, the legislature also approved as part of its comprehensive special-education reform package a provision requiring every school in the state to put an "instructional-support team" in place. The teams are to advise teachers on ways to better serve all students with learning problems in regular classrooms.

In addition, the measure would set aside 1 percent of special-education funds every year for the next five years to help train regular-classroom teachers in how to deal with a wider range of student abilities.

The formula also provides a penalty for districts found to be overidentifying students. Beginning in 1993, districts whose number of special-education students is 20 percent or more above the statewide average will undergo an audit by the state department. Districts that fail to reduce their counts over time could lose half their special-education block grants.

The bill also includes a promise by the state to share 50 percent of the costs of educating handicapped children in the coming years.

"We're basically saying if you continue to operate your special-education programs in a responsible, cost-effective way, we'll continue to be a 50-50 partner," said Marc Hull, the state director of special education and compensatory services.

State officials also plan next year to begin tightening their definitions of a number of special-education categories.

Ensuring Service

Gov. Madeleine M. Kunin is expected to sign the bill.

Some special-education advocates and parents, however, have expressed concern about the methods by which the legislation seeks to tackle the problem of rising costs.

The advocates ask whether the changes will mean that some children in need of special help may not get it.

"The concern is that, in the implementation of this, some people will become overzealous about bringing their child counts down and they will begin to tell parents, 'Your child is no longer eligible for special education,"' said Joan Sylvester, who followed the reform package for the Vermont Coalition of the Handicapped, an umbrella group of 28 advocacy groups.

State policymakers, however, said the basic rights of handicapped children will be protected.

"If parents become disillusioned or disenchanted with the pre-referral process, they can still have their child evaluated" for special education, said Represenative Barbara L. Grimes, who chairs the House education committee.

Backers of the legislation also said the change in the funding system affects only one piece of an existing three-part formula for special education that already includes some flexibility for school districts facing genuinely high costs.

For example, the formula reimburses school districts for 90 percent of the cost of educating students whose services are more than three times as expensive as that of the average nonhandicapped student.

Even so, some special educators in the state remain wary.

"It's almost as if they think experimenting with the reward system will change the reality," said Mary Peabody, a Bristol special educator. "I don't think it will."

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