Committee examines rising special-education costs and timing of state reimbursements; data show enrollment and per-student cost growth

The House Education Committee devoted substantial time to special-education funding, reviewing a Department of Education breakdown of statewide special-education revenues, expenditures and historical trends. Committee members and DOE staff discussed why local districts cover roughly 80—30% of net special-education expenditures, how reimbursement timing creates year-to-year mismatches, and what data the committee needs to evaluate policy adjustments.

Lede: Department of Education staff presented a district-by-district table showing FY 2024 special-education expenditures and the portion covered by federal IDEA, state special-education aid (formerly 'catastrophic aid') and differentiated aid. The statewide picture showed an increasing share of students with Individualized Education Programs (IEPs) even as total enrollment declined.

Key points: - Enrollment and IEP trends: Committee materials and testimony showed total statewide public-school enrollment declined from about 84,500 in 2017 to roughly 69,000 in 2024, while the number of students with IEPs rose from about 32,000 to about 35,000 in that period, increasing the percentage of students with IEPs from about 17% to about 21%. - Costs and who pays: The DOE table presented FY 2024 totals showing the state paid about $33.9 million in special-education aid (statutory catastrophic aid/proration), federal IDEA grants and differentiated aid contributions; districts reported the remaining expenditures as local responsibility. The committee heard that double-counting in the DOE-25 reporting (tuition paid from one district to another and the receiving district also reporting costs) can be material (DOE staff cited ~ $12 million annually as an example of inter-district counts). - Timing and proration: DOE explained that aid for a fiscal year is based on claims submitted in the next fiscal year, producing timing mismatches in small districts where a single high-cost placement can materially affect year-to-year ratios. - High-cost placements and variability: The committee asked about an individual maximum student claim (DOE provided a top recorded eligible cost in FY24 near $571,000) and about the drivers of wide variation in per‑IEP spending across districts. DOE staff said some of the variation reflects different local placement choices, differing ability to provide services in-district, and the presence of out-of-district placements.

Requests and next steps: Committee members asked DOE for additional detail: town-level comparisons of Medicaid counts vs. FRPL (for other work), a breakdown of catastrophic claims by cost bands (so the committee could see how many students fall into $0-70k, $70-100k bands, etc.), and a follow-up on whether DOE can model the effect of moving the catastrophic threshold (for example, from 3.5x to 2.5x per-student cost) and the resources required to produce rate-setting or more granular auditing.

Ending: DOE agreed to pull additional detail, including historical trend tables by band, and to respond on what it would take (time and staffing) to produce more granular, auditable cost-per-student measures and to explore whether a state-level review protocol could be established for out-of-district rate-setting.