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May 23, 2024

SIGNED! New School Finance Formula to Increase Equity in School Funding, Support Rural Districts

Bipartisan school finance formula drives more resources to support at-risk students, English Language Learners, special education students, and rural districts

AURORA, CO –  Governor Jared Polis today signed a monumental, bipartisan bill to support Colorado students. HB24-1448, sponsored by Speaker Julie McCluskie, Assistant Majority Leader Jennifer Bacon, Senator Rachel Zenzinger and Senator Paul Lundeen, R-Monument, will update Colorado’s outdated and inequitable school finance formula by increasing funding for rural schools and at-risk, special education, and English Language Learner students. 

“This law is a monumental step forward for public education in Colorado and a breakthrough achievement for how we fund our schools,” said Speaker Julie McCluskie, D-Dillon. “For far too long, our school finance formula has not invested in the students with the greatest needs, underfunding rural districts and those serving more children in poverty. The new, student-focused formula will increase funding for K-12 education and drive more resources to at-risk students, English Language Learners, special education, and rural school districts. Every student deserves a world class education no matter where they live, and with this new law, we will live up to our promise to set all Colorado students on a pathway to thrive.” 

“For my entire time in the legislature I have worked diligently to ensure Colorado’s schools receive the support they need to thrive,” said Senator Rachel Zenzinger, D-Arvada. “Whether as a member of the Joint Budget Committee, serving as Chair of the Education Committee, or as a member of the Public School Finance Task Force, I have been steeped in the development of Colorado’s school finance formula and I’m deeply invested in setting up our schools for future success. I am extremely proud of our work to update Colorado’s school funding formula to ensure it reflects the needs of every Colorado student – regardless of zip code. This new law will ensure that schools are funded equitably and that all students are receiving the resources they need to be successful.”

“With our historic buy-down of the budget stabilization factor, this is the time to update Colorado’s 30 year-old inequitable school finance formula to better reflect our state’s values,” said Assistant Majority Leader Jennifer Bacon, D-Denver. “When it comes to public education in Colorado, we have not been meeting the needs of our most vulnerable students, including our at-risk, English Language Learners, and special education students. This is the best opportunity we’ve had in decades to direct additional dollars to the districts and classrooms serving students with the greatest needs. When we invest in high-quality public education, we’re investing in our future, and I’m beyond proud to be championing a law that prioritizes student outcomes and opportunity for every child in our state.”

HB24-1448 will update Colorado’s school finance formula which has not been significantly modified in 30 years. The current formula, which is built around district-centered factors rather than student needs, is confusing and overly complex. It directs more funding to wealthier districts, rather than directing funds to low-income students, English Language Learners, or those in special education who are shown not to achieve at the same levels as their peers. 

This legislation implements the spirit of the recommendations of the School Finance Task Force, which reached overwhelming consensus, in order to drive more resources to the students who need them the most. 

With hundreds of millions of additional dollars now going to public schools in Colorado, these changes, which will take effect for the 2025-2026 school year and implement in a gradual phase-in over 6 years, will drive more of these new resources to historically underfunded districts with lower property wealth and that serve a higher number of at-risk students, English Language Learners, and Special Education students. When fully implemented, there will be $866 million in the formula for our at-risk students, $142.7 million for English Language Learners, and $240 million in the formula for our Special Education students, in addition to the constitutionally-required $375 million in the Special Education categorical. 

The new formula puts students first by increasing the student weights for at-risk, English Language Learners, and adding a new special education factor, all set at 25 percent. Smaller districts with a concentration of 70 percent or higher at-risk students will receive an extra 7 percent, to total 32 percent, ensuring their high concentration of at-risk students get the additional funds they need. Funding for every district will increase by at least .5 percent year over year. The categorical funding for special education will continue to increase according to law and Amendment 23.

The new formula is simpler and better accounts for district characteristics by fixing the “Order of Operations” to emphasize student needs. It removes the multiplicative factors that change the base funding per pupil, which currently creates cascading funding impacts throughout the formula that are challenging to track. Instead, factors that increase funding for small districts or districts with high cost of living will be additive and easy to understand. It also creates a new remoteness factor to support rural schools and will hold harmless any districts that drop below current law funding. Access the school finance simulator here to see individual school district impacts.

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