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Colo. Lawmakers Ponder Replacing 6-Year-Old Funding Formula

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Six years after adopting an unusual school-finance formula based on geographic categories of districts, Colorado lawmakers are moving toward scrapping that plan in favor of a new formula tied to more conventional criteria.

Hailed at the time of its passage as a solution to the state's endemic school-finance woes, the 1988 law has come under fire from school districts almost since the day it went into effect. (See Education Week, Oct. 26, 1988.)

The new formula approved by the House Finance Committee this month would be based on district enrollment, with adjustments for such factors as the local cost of living and the number of at-risk students.

"Since the 1988 act, there has been growing contempt because it arbitrarily places districts in different categories,'' said Phil Fox, the chief lobbyist for the Colorado Association of School Executives. "While [the current formula] has done a lot to eliminate inequities, it does not go far enough.''

The 1988 plan sought to equalize funding by dividing districts into eight "setting'' categories, ranging from "urban'' areas such as Denver to "recreational'' areas such as the ski-resort communities of Aspen and Vail.

Complicated Categories

Critics of the current formula say it has resulted in some districts getting as much as double the per-pupil state aid of others. Some districts received more than $8,000 per pupil in 1991, for example, while others got less than $4,000.

"Not only were the setting categories really complicated, they didn't really accomplish what they were supposed to,'' said Wayne Carle, the assistant superintendent for planning services in the Jefferson County district, the state's largest.

The geographic categories did not necessarily relate to the cost factors involved in educating students, he said.

An Interim Committee on School Finance developed the new proposal last year. It would be based on an enrollment count from October of the current school year, instead of an average from the previous year--a method that caused major problems for fast-growing districts.

The base per-pupil funding amount for 1994-95 would be $3,324. That figure would then be used in a formula that would include district personnel costs, a cost-of-living factor, and a district size adjustment.

The formula would then provide additional funding to districts based on their number of at-risk students. The bill defines all students who qualify for the federal school-lunch program as at risk.

"It's the only thing we have right now that is measurable and auditable,'' Mr. Fox said.

A district would receive an additional 10 percent of its per-pupil funding figure for each student who meets the at-risk definition. In districts with at-risk enrollments higher than the statewide average, the additional funding would be greater than 10 percent per pupil.

Backed by Governor

Gov. Roy Romer has said he supports revamping the school-finance formula.

In his "strategic agenda'' document presented to lawmakers last month, he said the current formula was "not equitable or fair.''

"It makes sense to eliminate our current funding categories and recognize the different costs for different students, particularly for those at risk,'' he added during his State of the State Address.

Mr. Fox said the new formula has attracted unusually wide support because it contains a "hold harmless'' provision under which districts would receive at least as much state aid next year as they currently receive. Some districts want the hold-harmless period extended to three years.

"One of the bigger debates is over how long hold harmless should go on,'' he said.

Under the bill, sponsored by Rep. Norma V. Anderson, state aid would be boosted by $132 million in fiscal 1995.

The bill has several other provisions. One would increase the number of children served by the state's preschool program from 2,750 to 4,500 in fiscal 1995, 6,500 in 1996, and 8,500 in 1997.

The bill also would increase the amount of revenue districts could raise with voter approval, to the greater of $200,000 or 25 percent of a district's formula funding, from the current limit of 15 percent.

The House Appropriations Committee was scheduled to consider the school-finance bill late last week. The bill could move to the House floor by this week.

Meanwhile, the House Education Committee this month approved a bill to give districts the option of adopting a performance-pay plan for teachers. The measure would eliminate the current state salary schedule used by districts as base criteria for setting local pay levels.

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