Pennsylvania

Funding priorities for p-12 and higher education

The education appropriation for the 2020-21 fiscal year is $13.5 billion, a three percent decrease over the 2019-20 fiscal year.¹ This figure includes funding for P-12 education, public libraries, community colleges, and state-affiliated universities (The Pennsylvania State University, University of Pittsburgh, Temple University, and Lincoln University). Appropriations for the Pennsylvania State System of Higher Education and Thaddeus Stevens College of Technology are separately reported in the Commonwealth budget, receiving a total appropriation of $496 million (a zero percent increase) for the 2020-21 fiscal year.

The enacted budget sustains 2019-20 funding levels for most P-12 education programs, including:

• • $6.7 billion for basic education funding, the largest source of state aid to school districts (a zero percent change)

• • $1.2 billion for special education funding (a zero percent change)

• • For early childhood education, the budget maintains funding from the previous fiscal year as well, including $268 million for Ready to Learn Block Grants (a zero percent change) and $217 million for the Pre-K Counts program (a zero percent change)

The enacted budget also sustains 2019-20 funding levels for higher education, including:

• • $597 million for state affiliated universities (The Pennsylvania State University, University of Pittsburgh, Temple University, and Lincoln University)

• • $477 million for the State System of Higher Education

• • $19 million for Thaddeus Stevens College of Technology

• • $244 million for community colleges

Changes to funding formula for p-12

Pennsylvania adopted new formulas for distributing basic education funding in 2016 and special education funding in 2014. Both formulas include weights and multipliers to adjust basic education and special education funding in relation to the financial needs of school districts and the local taxing effort of each district's residents. However, both formulas included hold harmless provisions stipulating that only basic education funding appropriated above 2014-15 levels and special education funding appropriated above 2013-14 levels should be distributed through these formulas.²

For the 2020-21 fiscal year, this means only 10 percent of the state's $6.7 billion basic education funding appropriation will be distributed through state's formula. The remaining 90 percent is based on each district's 2014-15 appropriation. Since earlier hold harmless provisions have shaped the distribution of basic education funding for years prior to the creation of the new formula, even the 2014-15 appropriation did not necessarily reflect school district enrollment or needs in 2014-15. Similarly, only 13 percent of the state's $1.2 billion special education funding appropriation for 2020-21 will be distributed through the state's need-based special education funding formula.³

Pressing state issues affecting p-12 and higher education funding

With the impact of the COVID-19 pandemic on state finances still uncertain, Pennsylvania lawmakers agreed on an interim budget for the start of the 2021 fiscal year. The budget was signed by Governor Tom Wolf on May 29, 2020.⁴ Prioritizing education, this stopgap budget appropriates funds to cover the entire fiscal year for early childhood education, K-12 education, and higher education. For almost all other appropriations, this interim budget only provides five months of funding.⁵

Fiscal impact of alternatives to public schools

Charter schools in Pennsylvania are funded through tuition payments made by the school district where each child enrolled in a charter school resides. These tuition rates are based on each district's nonspecial education expenditure per average daily members (for general education students) or each district's special education expenditure per average daily membership (for students with special needs).

As a result, the tuition rates paid by each school district varies with a district's spending. In 2019-20, nonspecial education tuition rates ranged from a low of approximately $7,400 per enrolled charter student to a high of approximately $21,600 per enrolled charter student. Special education tuition rates ranged from a low or approximately $10,200 per enrolled charter student to $55,700 per enrolled charter student.⁶ In the fall of 2019-20, 146,556 students were enrolled in charter schools...