Pennsylvania

Prior years absorbed substantial decreases in K-12 and higher education funding under Governor Corbett. These reductions resulted in significant program/budget reductions in school districts and a statewide loss of 23,000 education sector jobs. There has been no significant recovery of education funding in the last four years, with most of new K-12 funding going to pay for state and district share of pensions (see table below). Few funds were left over for instructional needs. As a result, districts raised taxes and reduced services.

Pennsylvania’s 2014–15 Enacted Public Education Budget for Support of Public Schools (K-12) increased by $304,978,000 (3.13%) to $10,046,550,000. The Basic Education funding appropriation, the largest component at $5,526,129,000 remained unchanged with no increase from the 2013–14 budget. For 2015–16, a new Governor (Wolf (D)) was elected on a platform to restore education funding, but he must work with a conservative Republican-controlled legislature. First year has proved to be very difficult and contentious.

	2010–11	2011–12	2012–13	2013–14	2014–15 *	5 year change
K-12 Total	8,670,492,218	8,917,851,235	9,152,393,973	9,582,679,902	10,046,550,000	1,376,057,782
Basic Education	4,747,777,679	5,354,587,594	5,393,106,067	5,523,643,904	5,526,129,000	778,351,321
Pension **	355,174,452	510,062,120	730,690,871	997,825,574	1,157,853,000	802,678,548

Source: Actual PDE Annual Financial Reports

* As estimated from enacted budget

**. State share of pension (included in K-12 total above)—District pays approximately the same amount

Note: 5 year change in state share of pension exceeds estimated 5 year change in Basic Education Funding; school districts must pay their share (approximately 50%) resulting in basic education increases over the 5 years just covering pension

Pennsylvania’s 2015–16 Education Budget remains (as of mid-August 2015) in limbo caught between Governor Wolf ’s proposed budget and the Republican-controlled General Assembly budget which the Governor vetoed in its entirety.

Governor’s Proposal

A Basic Education Funding increase of $400 million to restore the Accountability Block Grant, Education Assistance Program and Basic Education Funding which were cut in previous years, and to provide a reimbursement of approximately ten percent of the payments school districts are required to make to charter schools. A new Special Education Funding (SEF) formula (2014–15) continues the transition to use several categories of support for students with disabilities. A total of $1.06 Billion is proposed for SEF, to be distributed through the student-based formula; this represents a $96 million increase for 2015–16. For Higher Education, the proposal included an increase of $143.4 Million or an 11.8% increase.

General Assembly’s Proposal

Following budget negotiations between the House and Senate, a budget was passed by the General Assembly and sent to the governor at the end of June. The Republican budget, which includes no tax increases, included $100 million for basic education, $25 million for special education and an allocation of $0 for capital construction reimbursements. The budget submitted was vetoed by the governor in its entirety leaving the state without a general fund budget.

Some Common Ground

Property tax relief: Both the House and Senate, as well as the governor, all proposed some kind of property tax relief/reductions which include various tax shifting schemes for increases in the state personal Income tax (currently at 3.07%), and/or an increased rate and/or an expanded base for the state sales tax (currently at 6.0%).

Changes to the State Formula: Pennsylvania has not had a basic education funding formula for decades, and that continued in 2014–15. In a report Issued June 18, 2015 a Bi-Partisan Basic Education Funding Commission recommended an actual funding formula. The formula includes factors reflecting student and community variations. Student-based factors include three separate weights for varying levels of poverty, Limited English Proficiency, and charter school attendance. District-based factors include sparcity, median household...