Title I inequities and end of pandemic-era Medicaid eligibility threaten Michigan at‑risk school funding

Craig Theel, research director at the Citizens Research Council, told the Michigan House Appropriations Subcommittee on School Aid and the Department of Education that two federal funding issues threaten state efforts to direct more resources to low-income students.

Theel said Title I federal grants are distributed unevenly across districts and that a recent 7.5% statewide decline in the number of students counted as economically disadvantaged will reduce the number of pupils that generate state at‑risk payments. “Congress has failed to address the inequities of Title 1. So Michigan lawmakers should step in,” Theel said, and he recommended using state at‑risk dollars to correct the federal distribution problem.

The issue matters because Michigan ties state at‑risk (Section 31a) funding and recent Opportunity Index targets to counts of economically disadvantaged students. Theel said the state target adopted from the School Finance Research Collaborative is a 35% weight above the foundation allowance for high‑need students (higher in the highest‑poverty band), but that Title I — roughly $500 million a year in Michigan, he said — does not align with those state weights and is “inequitably distributed.” At the same time, the end of pandemic-era Medicaid enrollment rules reduced the count of students directly certified as low…