Senate Education briefing examines proposal to inflate Act 73 base; JFO says first‑two‑year change would raise the permanent trajectory
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Summary
Lawmakers reviewed Joint Fiscal Office modeling showing Senate Education language that inflates the Act 73 base for the first two years would raise the permanent foundation formula base (example: ~ $16,575 vs $15,936 if NIPA were used), which — all else equal — would increase education funding obligations and likely require higher property tax revenue.
The Senate Education Committee on April 7 reviewed Joint Fiscal Office modeling of a proposal to inflate the Act 73 foundation‑formula base in the first two years before reverting to the standard NIPA inflator. JFO staff told the committee this temporary change would permanently raise the base level used to compute districts' education opportunity payments and therefore, holding everything else constant, would increase statewide education funding needs.
Patrick Holden of the Joint Fiscal Office explained the mechanics: Act 73's $15,033 base (as enacted for FY25) would be increased by actual changes in education spending for the first two years under the Senate concept; JFO's example numbers showed a cumulative two‑year increase that could put the FY27 base at roughly $16,575 under the Senate language versus about $15,936 using the NIPA approach.
"Using a different inflator for the first two years… you've permanently altered the trajectory," Holden said, adding that after the two‑year window the formula would continue to grow using the same NIPA indexing as under current law. JFO emphasized these are preliminary estimates using March budget inputs and that final impacts could shift as remaining school budgets are finalized or if policy choices change (for example, what belongs in the base such as career and technical education).
Committee members tested cost‑of‑change magnitudes. The chair described a back‑of‑the‑envelope calculation (the chair said a ~$6,632 per weighted‑student difference multiplied by about 82,000 students yielded an illustrative ~$51 million figure) to illustrate how a higher base could translate into larger statewide obligations. JFO cautioned that the actual fiscal effect depends on weighting structure, transition rules in Act 73, and other policy choices.
Members asked JFO to prepare follow‑up materials: a statewide average per‑pupil comparison under the foundation formula versus current law, sensitivity checks on weights and on whether certain programs should be in the base, and inflation‑adjusted comparatives for FY26–FY27. No formal action or vote occurred; the committee recessed for a break and scheduled further follow‑up with JFO.
