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Legislative analysts: Public Education Stabilization Fund at roughly $250.8 million, roughly $189.6 million below 15% cap
Summary
A Legislative Services Office analyst told Idaho's Joint Finance-Appropriations Committee that the Public Education Stabilization Fund (PSIF) held about $250.8 million on July 1, 2024, leaving roughly $189.6 million of headroom before reaching the 15% statutory cap established by recent legislation.
Jared Tedrow, deputy division manager in the Budget Policy Analysis Division of the Legislative Services Office, told the Joint Finance-Appropriations Committee on Wednesday that the Public Education Stabilization Fund, or PSIF, is intended to act as a safety net for the public school support program appropriations.
"Public Education Stabilization Fund or PSIF . . . acts as a safety net for the public school support program appropriations," Tedrow said during the committee's fund review presentation.
Tedrow said the legislature historically capped the fund at 8.334 percent of state funds appropriated to public schools, but House Bill 521 increased that cap to 15 percent. He cited a statutory review requirement when withdrawals occur, saying "Idaho code section 30 three-one 18 C requires JFAC to review the fund and consider a transfer if a withdrawal has occurred," as part of his prepared remarks.
Why it matters: PSIF holds dollars intended to smooth K-12 state aid if appropriations fall short or to receive excess when appropriations exceed formula-driven distributions. Tedrow said the fund balance rose after 2021 investments and that, as of July 1, 2024, the fund had a cash balance of about $250.8 million.
Details from the presentation: Tedrow reviewed a 10-year history, noting withdrawals from roughly 2015 through 2021 tied to increases in support units and appropriations. The committee previously moved deposits and transfers in 2020, 2022 and 2023; before the change to a 15 percent cap, excess deposits went to the bond levy fund. After the cap increase and legislative changes, excess funds now would be routed to the School District Facilities Fund established in House Bill 292.
Tedrow provided a working calculation showing the pool of state funds for public schools at about $2.94 billion; 15 percent of that amount was stated as $440,390,000. With the cash balance he reported, "that leaves a gap or a variance of $189,600,000 that could go in before it reaches that full cap," he said.
He also noted the governor recommended a $50 million transfer into the stabilization fund on July 1, 2026. Tedrow said that, based on current appropriations and support-unit projections, "if no additional action is taken an additional 35 to 40,000,000, very rough number, could be deposited into PSIF at the end of the year." He also told the committee the fund was generating interest each month (presentation transcript: about $8.9 million per month as stated in the presentation).
What the presentation did not decide: the presentation was informational; the committee did not vote on transfers or on the governor's recommendation during this session. Committee members did not adopt a new statutory interpretation or direct staff to execute transfers as part of the presentation.
Background: Tedrow traced the fund's origins to the Legislature's initial investment on July 1, 2006, described cyclical draws during the 2008-2011 recession and more recent restorations and deposits that followed legislative action in 2021'2023.
The presentation packet cited statutory references and the Economic Outlook and Revenue Assessment Committee materials as source documents for the figures and caps discussed.
