In the State

A New Way To Fund Special Education: CT School Finance Project Proposes Way To Fix Broken Special Education Funding

What does Arkansas, Rhode Island, West Virginia and Connecticut have in common?

Other than being a seemingly random list of states, the founder of the Connecticut School Finance Project Katie Roy says these four states are the only four in the national without a clear system for funding special education.

This dysfunction has real consequences.

Last year, Bridgeport’s Board of Education faced a $15 million increase in non-discretionary spending that caused a budget gap mid-year, resulting in layoffs of paraprofessionals and other cuts. Much of the ensuing shortfall was due to unexpected increases in special education spending

The problem, as Roy explains in a recent Op-ed for CT Viewpoints, is the cost of special education services can be unpredictable:

For Connecticut’s more than 74,500 students who need some type of special education service, this right is particularly important. Students with disabilities are entitled to a “free appropriate public education” under the federal Individuals with Disabilities Education Act (IDEA) and must be provided with the special education service(s) they need to access that opportunity. For some students that service may be as simple as working with a speech pathologist once a week to improve their pronunciation, while other students may require far more intensive, full-time specialized services and support to meet their needs.

These services and the resources required to provide them vary significantly, and often pose difficult planning and financial questions to Connecticut’s public schools and municipalities. Adding to this difficulty is the fact that Connecticut is one of only four states with no system for funding all of its special education students…”

Compounding this is the fact that, much of the cost for special education is shouldered by school districts’ operating budgets.

As a recent report by the Connecticut Council For Education Reform (CCER) explains, the state’s Excess Cost Grant is not designed to reimburse schools districts for all their special education costs:

“It only covers a certain reimbursable percentage that fluctuates from year to year. Moreover, the Excess Cost Grant is usually not fully funded by the state. Thus, even with state assistance, districts are still facing the same dilemma every year: allocating funding for special education costs without knowing how much will be needed each year or what percentage will be reimbursed.”

Roy believes her and her team at CT School Finance Project may have come up with a solution. After spending months meeting with stakeholders while looking at the way other states fund special education, CT School Finance Project, working with the University of Connecticut’s Neag School of Education and the Goldenson Center for Actuarial Research, came up with the Special Education Predictable Cost Cooperative.

As Roy explains in her Op-ed, the Co-Op model of special education funding would mean districts would be reimbursed for 100 percent of the cost of special education:

“The Co-op allows state and local governments to share in the cost of funding special education through a cooperative model that uses actuarial principles to increase stability and predictability in special education funding for school districts, while ensuring decisions in service delivery remain local. The Co-op is designed with three important goals in mind:

  • Protecting students. The Co-op protects students with disabilities by ensuring adequate funding is available for the services they need and deserve—no matter what their disabilities may be. At the same time, the Co-op also benefits those students not requiring special education services. All students benefit from the Co-op because predictable special education funding helps stabilize general education funding and ensure districts don’t have to resort to dipping into their general education funding to pay for necessary special education services.
  • Improving predictability. The Co-op would allow all districts and municipalities to know what their total special education costs will be in the prior year, when they are creating their budgets, allowing for better budget planning. Then, during the school year, districts would be reimbursed for 100 percent of their actual special education costs.
  • Increasing equity. The Co-op takes into account a district’s ability to pay for the special education services its students need. While under the Co-op every school district would receive some state aid for special education, and be reimbursed for 100 percent of their actual special education costs, districts with greater student need would receive greater state aid.

The Co-op is able to achieve these goals by aggregating special education costs at the state level to leverage the fact that, on a statewide basis, special education costs are predictable, even though they are frequently volatile at the district level. The Co-op would be funded by contributions from the state and municipalities.

The state would contribute by reallocating its current state support for special education to the Co-op, while municipalities would contribute by making a community contribution for each special education student who lives in their town. A community contribution would be calculated for each town using a formula that takes into account the town’s number of special education students, past special education costs, and the community’s ability to pay based on its wealth…”

Here’s a link Katie Roy’s full Op-ed on the Special Education Predictable Cost Cooperative.


Special Education Predictable Cost Cooperative Policy Paper by Megan Elizabeth DeSombre on Scribd


Special Education Funding Dilemma by Megan Elizabeth DeSombre on Scribd

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