The Governor, in his fiscal 2014 budget, has proposed to finally complete the education aid reform initiated in 2006. This is extremely good news for Watertown — Watertown had, for years, been badly short-changed by the failure to fully implement the 2006 reforms.
Belmont also benefits, although more modestly, from the reform.The Governor uses a minimum aid rule to protect communities like Boston that have historically done well under the formula and were not beneficiaries of the reform.
The funding formula is complicated, but for Belmont and Watertown, the key 2006 provision was the requirement that every town receive Chapter 70 education aid equal to at least 17.5% of their basic education budget (“foundation budget”). Belmont was at 16.71% last year but Watertown was down at 12.38%. Belmont and Watertown have the same wealth (based on a ranking that equally weights per capita income and taxable property) and should be receiving aid that is roughly equal as a share of foundation budget.
In 2014, under the Governor’s proposal, Watertown and Belmont will both receive aid equal to 17.5% of their foundation budget. The bottom line is that Belmont receives an 11.03% increase or $631,130 additional dollars. Watertown receives an increase of $1,643,403 or 49.18%. See local aid totals here.
The Department of Elementary and Secondary Education explains the reform as follows:
Municipalities whose local contribution requirements are now higher than their targets will see a reduction in the requirement of 100 percent of the amount above the target. This fully phases in the equity component of the formula for the first time.
This language refers to target local contribution, which is set at a maximum of 82.5% of foundation — the aid minimum of 17.5% follows from that. The big jump in aid that Watertown receives reflects the full reduction of required local contribution down to target contribution. The full FY14 formula explanation appears at this DESE webpage.
Boston has always been well above the 17.5% level (28.70% last year) and the Governor protected Boston by providing that all communities should receive a minimum increase of at least $25 per pupil. That translates into a relatively modest .75% increase in Chapter 70 aid for Boston.
As the formula evolves through the budget process, I hope we can increase the protection for Boston, but I am extremely grateful to the Governor and his staff for choosing a formula approach that addresses the long-standing egregious unfairness to Watertown.
I wrote in depth about the unfairness of the formula in a series of web posts last winter. Through the fall, I have been working with Representatives Hecht and Lawn to convey to analysts on the Governor’s staff the unfairness created by the failure to fully implement the 2006 reform and to help them identify options for implementing the reform.
The special education circuit breaker, also a program that substantially benefits Belmont, Watertown and Boston comes in at $231 million — not quite at full funding, but well above levels during the recession and equal to the projected spending in 2013, which was slightly reduced from the originally budgeted maximum by 9C cuts.
This is just the beginning of the budget process, but the Governor’s numbers tend to define a floor for local aid. It will be a top personal priority for me to assure that, at a minimum, we are able to keep these Chapter 70 numbers. The total increase in Chapter 70 is $228 million — substantial in a year which without new general revenue will show a budget gap. So, realization of the Chapter 70 reforms may depend on a broader package which includes new revenues.