Published: January 6, 2005

Finance Snapshots

Ohio

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Ohio had been fighting a lawsuit mounted by the Ohio Coalition for Equity & Adequacy of School Funding since 1991. The state system for financing education has been ruled unconstitutional three times, but the state supreme court decided to end its jurisdiction in the case, DeRolph v. State, in December 2003. Ohio pays for education through a foundation formula that is based on the concept of adequacy. To calculate the foundation level, the state chose a group of districts that had met certain standards on state tests and had also achieved certain attendance and graduation rates in grades 4, 6, 9, 10, and 12. Then, using measures of income and property wealth, the state removed the top and bottom 5 percent of districts from its calculation. From the remaining districts, the state calculated the average base-cost expenditure, which was used as the foundation level. In subsequent years, the state has adjusted that number for inflation. For the 2004-05 school year, the foundation level is $5,169. Local districts are required to levy a 20-mill property tax to receive state aid, but districts can also raise their share through a district income tax. Ohio’s funding formula includes adjustments for such district characteristics as variations in the cost of living, special education students, vocational education students, and the education and experience levels of teachers. The state also provides grants to districts, based on their concentrations of economically disadvantaged pupils.

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Vol. 24, Issue 17, Page 70

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