Per Pupil School Funding in Indiana

This post comes out of a brief online discussion among several participants in the Parent Community Network of Monroe County about the financial impact on a local school corporation of a child moving from the public school corporation to a charter school. Someone had heard that a local school corporation loses about $500K for every 100 students who leave to attend a charter school and wanted a source for that figure. As you will see here, that figure makes a good rough estimate of the hit that local public schools take when students leave for charter or private schools (now funded by vouchers).

Although the details are arcane and have changed several times over the years, Indiana’s school funding formula has based the tuition support (the amount of funding provided to a local school district by the state) on the number of students attending the school district, based on a once-per-year (in September) count of students called the Average Daily Membership (ADM) (the ADM count was changed to twice a year starting in 2013). For example, Monroe County Community School Corporation’s tuition support per student for 2013 is approximately $5231 and Richland-Bean Blossom’s is approximately $5160 (there is some uncertainty in these numbers because of the expiration of the school funding formula).

In recent years, Indiana has moved even more aggressively to a “funding follows the child” model for school funding. In 2012, changes in the legislation eliminated some protections that school districts had from rapid fluctuation in enrollment (a process oddly-named “re-ghosting” adjusted ADM numbers based on a 5-year average of enrollment increases or declines) and also incorporated charter schools into the funding formula. In essence now, when a student leaves the public school corporation for a charter school, the public school loses the funding associated with that student, and the charter school gains the funding associated with that student. Using the above numbers, if 100 students leave MCCSC for a charter (or private) school, MCCSC loses around $523,100.

While a “funding follows the child” approach has a patina of fairness, this loss of funding when parents flee the public schools can do real harm to the public schools. Public school corporations operate under substantially greater regulatory burdens than do charter and public schools, have substantially greater fixed costs, and must serve all students in the district. The losses to charter and private schools tend to be spread out around the district, covering multiple schools and grade levels. The public school corporation can’t therefore simply eliminate a few positions to compensate for the loss. Instead, it puts an even greater burden on the entire system, which is already straining from increased demand and stagnant funding.

On a personal note, I do believe that parents should have choices. My own child attended the Bloomington Project School (a public charter school), and I cannot say enough good things about it. But alternatives like the Project School need to exist on top of a base of public education that is well-funded and available to all.  The funding formula needs to ensure that these basic needs are met first — that the public schools are funded well and that every child in every public school in the state has access to a high-quality public education. But our general assembly has been moving in exactly the opposite direction.

Here is a summary of the (estimated) 2013 per-student tuition support for each school district in Monroe County:

School District 2013 Estimated
Tuition Support
Monroe County Community School Corporation $5231.35
Richland-Bean Blossom School Corporation $5160.05
The Bloomington Project School $5101.74

SourceReport from Indiana Department of Education, Office of School Finance

Note: NPR’s StateImpact Bite Sized Breakdown: How Are Schools Funded? provides a brief summary of several of the changes made by the General Assembly during the 2012 Session. During this session, the existing school funding formula was set to expire on July 1, 2013, and there are still some outstanding questions about exactly how much schools will receive during subsequent school years.