South Dakota
- South Dakota
funding priorities for south dakota p-12 and higher education
It has been three years since the legislature passed Governor Daugaard and the Blue Ribbon Task Force's proposed education funding bills (HB1182, SB131, and SB133), known as The Blue Ribbon Legislation, which was created to improve the K-12 funding formula, raise teacher pay, and improve class sizes. Previous funding formulas focused on the number of students, but since 2016, the funding formula has shifted to focus on targeted student-teacher ratios. Governor Noem granted the Legislature authority to spend $3.5 million to legalize industrial hemp and $55 million to give K-12 teachers, state employees, and Medicaid health care providers a two percent raise.1
Higher education has not been immune to financial difficulties either. In April 2019, the South Dakota State Board of Regents voted to raise tuition and the mandatory general activity fee by roughly 3.4 percent. This is the second year in a row for 3.0+ percent tuition hike, which will reportedly be used to increase staff salary and health coverage. Subsequently, South Dakota public universities have seen a 2.5 percent enrollment drop in the past year.
changes to funding formula for p-12 and/or higher education
Blue Ribbon Legislation focused on low teacher salary and increasing student-teacher ratios. The Legislation enacted a half-cent increase in state sales tax, which increased school funding by $67 million, with a target average teacher salary of $48,500. Furthermore, the state is also required to increase annual state funding at an inflation consumer price index (CPI), or three percent, whichever is less. The sliding scale for student-teacher ratio is based on levels of fall semester district enrollment, which are: Enrollment less than 200 is 12 students to one teacher, enrollment 200-600 is sliding scale between 12 to one and 15 to one, enrollment greater than 600 is 15 to one.
For FY 2020, the CPI for average teacher salary is a target of $50, 360.26. The state aid formula is calculated by dividing fall enrollment by the target student-to-staff ratio, and then adding 29 percent for employee benefits. The district's total instruction need is then increased by an overhead rate of 33.06 percent for FY 2020, which is used to cover non-instructional costs. After the total state aid is calculated, local district revenues are applied, and the state provides any additional funds to achieve total need. [End Page 354]
Higher education has seen an increase of faculty compensation by 2.5 percent, with a health coverage increase of $1,601. Employee compensation raises have been funded through two consecutive years of increased tuition and mandatory fees.
pressing state issues affecting p-12 and/or higher education funding
The Blue Ribbon Legislation hinges on state sales tax, which can present a funding problem when collections are not sustained. Because of miniscule increases in state aid, approximately half of the state's school districts were initiating opt-outs, which allow district and patrons to levy property taxes to assist in funding. Although Governor Noem has reversed course on her initial budget of no teacher pay raises, it is anticipated that the list of opt-out districts will continue to increase.
In the past decade, higher education enrollment has decreased by five percent, including a decline of state-resident students by 17 percent. Universities continue to generate 60 percent of funding from tuition and fees, while state support has remained flat.
South Dakota schools closed in mid-March due to the COVID-19 pandemic. Nearly 30 percent of South Dakota P-12 students did not participate in remote learning. Governor Noem utilized $41 million from the Elementary and Secondary School Emergency Relief Fund, dispersed from the U.S. Department of Education, to assist reopening. Noem also issued schools $5.7 million awarded through the Governor's Emergency Relief Funds South Dakota public and private schools will receive an additional $500 per student, from the CARES Act, which is an additional $75 million to support South Dakota schools.
