Senators seek amendment to delay new foundation formula until districts and legislature sign off

Members of the Senate Education committee spent the hearing on H.454 debating how and when a proposed statewide foundation formula for school funding should take effect, and moved to draft a committee amendment to delay implementation until new school districts exist and the legislature has an opportunity to affirm the new base and weights.

The change under discussion would make the foundation formula contingent on two conditions: the completion of new district maps and an affirmative follow-up by the Legislature before any new tax rates tied to the formula take effect. Committee members said they want a formal “check back” so constituents will not see new tax rates or base-and-weight calculations roll out automatically after the commission’s work is finished.

Why it matters: the foundation formula will reallocate how education spending is determined across districts and therefore affects local property tax rates. Senators repeatedly raised concerns that, as drafted, the bill could shift tax burdens when district property wealth is rebalanced and that the measure does not yet show how it will preserve or improve educational quality while containing costs.

Committee members debated two technical choices that shape how spending limits would operate. One is the current “excess spending” penalty in statute, which applies a flat threshold (historically discussed as roughly 118% of a baseline) and subjects spending above that line to extra tax consequences. The other is an “allowable growth percentage,” a mechanism used in prior legislation (Act 46 was cited) that ties each district’s allowable growth to a formula comparing its per-pupil spending to the state’s highest per-pupil spender; lower-spending districts would get a larger percentage increase under that approach.

Julie, a staff member who identified herself to the committee, described the difference: “The allowable growth percentage is based off of where their education spending per pupil is in relation to the highest per pupil spending for the fiscal year you would choose,” and the result is that “the lower spending districts in the following year have a higher allowable growth percentage because they're further away from the highest per‑pupil spending.” Her explanation framed why some senators worry an allowable-growth approach could allow large dollar increases for high-spending districts while also providing room for lower-spending districts to catch up.

The panel also returned to the idea of an exception process for districts that face unusual cost pressures. Several senators recommended using a Professional Judgment Panel (PJP) or similar review body to consider district‑level factors — such as local cost of living, contract obligations and student needs — when granting exceptions to the base-rate calculations. Committee members described PJPs as a way to address cost or program exceptions without undermining statewide equalization goals.

Legal and procedural concerns surfaced about binding future legislatures. The committee’s counsel advised that the Legislature cannot bind a future Legislature to take an action; instead counsel recommended requiring an external certification (for example, by the Agency of Education) that specified implementation conditions are met and giving the Legislature time to act before new rates or weights would apply. John Gray, legislative counsel for the House, clarified the contingency mechanics: the foundation formula in the bill can roll out under the stated contingencies, but an affirmative determination would be required to adopt a recommended alternative approach presented in a later report.

Committee members sought language that would make it explicit in statute or a committee amendment that no new tax rate tied to the foundation formula will go into effect until the new districts are established and the Legislature has had the opportunity to review and affirm the base and weights. Senators also asked staff to prepare amendment language and to coordinate with licensed counsel (Beth) on certification language and with the Agency of Education to identify what AOE certification would cover.

No formal roll-call vote was recorded in the transcript of the hearing; the transcript instead shows committee members agreeing to pursue a committee amendment and to work with counsel and staff on stronger contingency and certification language. One senator told the committee she would “file the amendment” to move the matter forward, and other members indicated support for strengthening the contingency to require an affirmative legislative action before the new rates take effect.

The committee’s discussion ranged beyond timing and procedure to broader questions of governance, quality and cost control. Senators asked that follow-up work specifically examine districts that spend less yet achieve strong student results, so that the state can better identify efficient practices to replicate. They also flagged special-education costs, rising health-insurance and contract obligations as drivers of near-term district budget pressure that the new funding model must reckon with.

Next steps: staff and counsel will draft the committee amendment language described in the hearing; the committee signaled intent to consider the amendment and to clarify in statute or the report process that the Legislature must have an opportunity to affirm the new base and weights before any new tax rates tied to the foundation formula are implemented.