House subcommittee advances school-aid and education budgets that roll up categorical funding into larger per-pupil payments

LANSING — The Michigan House Appropriations Subcommittee on School Aid and the Department of Education on June 3 adopted substitute versions of two budget bills that would increase the foundation allowance and consolidate many categorical grants into a larger per-pupil payment while also changing several Department of Education operations and boilerplate requirements.

The panel adopted the House substitute for HB 4577 H-1, the school-aid appropriations bill, and the House substitute for HB 4576 H-1, the Department of Education appropriations bill, then voted to report both bills to the full Appropriations Committee with recommendations that they pass. Representative Jenkins Arnold, the subcommittee chair, moved the school-aid substitute and led discussion of the package’s intent to shift funding into a larger foundation allowance and reduce the number of line-item categorical accounts.

The package would raise the per-pupil foundation allowance from $9,608 to $10,025 (a $417, or 4.3%, increase) in the House plan and creates a new Section 22f that consolidates multiple categorical appropriations into an additional per-pupil payment. The summary provided to the subcommittee estimates the roll-up could raise effective per-pupil funding “up to $12,000” for districts; the subcommittee’s materials show the roll-up also allocates separate buckets for intermediate school districts (ISDs) and nonpublic schools (an estimated $228 per pupil for ISDs and $40.8 million total to nonpublic schools). Noel Benson, fiscal analyst with the House Fiscal Agency, told the subcommittee the roll-up includes one-time additions totaling about $370 million for school safety and mental-health supports, of which roughly $350 million in School Aid Fund dollars would go to district per-pupil payments and $20 million to nonpublics.

The House plan also moves balances from several reserve funds into the School Aid Fund and closes those accounts. Jacqueline Mullins, senior fiscal analyst for the House Fiscal Agency, listed the amounts the House would lapse into the School Aid Fund: $147.4 million from the MPSERS reserve; $120.3 million from the School Transportation Fund; $235.2 million from the Educator Fellowship Public Provider Fund; $50.8 million from the Educator Fellowship Private Provider Fund; $193.6…