CHEYENNE - It cost Wyoming approximately $1.37 billion to operate schools in the 2012-2013 school year. Coming up with that number is the charge of a school funding model and the School Foundation Program. Determining the funding amount each school district receives comes from years of cost-of-education studies that define the cost to deliver the statewide "basket of goods."
Figuring out how schools actually receive money to operate may be relatively unknown to those not in a district business office. In actuality, it is a combination of a number of revenue sources collected at both the local and State levels including mineral royalties, tax revenues, fines and penalties, and even tuition revenues from other school districts.
After the revenue is collected and distributed to local school districts, the local school district boards of education and school district leadership decide how each school district's funding amount will be spent based upon local needs and priorities.
Who decides what money schools receive?
The funding methodology currently in place was first implemented in 1997 in response to the Campbell I Supreme Court decision that required the state to implement a "cost-based," system of funding schools. Professional judgment panels and an evidence-based approach are the basis of the funding model's formula to determine what the cost to fund Wyoming schools is. About every five years the funding model is "recalibrated" to ensure the funding model remains cost-based in light of changing conditions and that the resources necessary to deliver the basket of educational goods and services are adequate. Since 1997, there have been three recalibrations: 2001, 2005 and 2010. The current school funding model has been in place since the 2010 recalibration and is scheduled to be recalibrated again in 2015.
In other words, the model determines how much each school district receives or is guaranteed. How that amount is determined is dependent upon many factors. The most important of which, is the number students attending Wyoming schools, which is defined as average daily membership. Other important factors that determine funding include student characteristics (i.e., at-risk student population), school and district characteristics (i.e., school grade levels, configurations and prototypes; and school and district student counts), school district staff characteristics (i.e., experience, education, and responsibility level or span of control), special education expenditures, transportation expenditures, and regional cost differences.
After the factors are taken into consideration and run through the funding model's formula, a funding amount is then calculated for each school district. That amount is then guaranteed to the individual school districts, which make the final determination for how the money is actually spent. For example, if the funding model determines a school generates a certain amount for supplies for a Career and Technical Education (CTE) program, it does not necessarily mean those funds generated by the funding model will go directly to the CTE program's supplies. It means the district has been funded for that program's supplies. The decision on how much of the model generated amount will be spent on the CTE program's supplies will ultimately be made by the local school district.
"It is worth noting that the funding model does not mandate how the funding is to be allocated," said WDE School Foundation Supervisor, Jed Cicarelli. "The nature of a block grant allows the school districts to have discretionary spending over how they deploy those resources based upon their local needs and priorities."
Getting the dollars they are entitled to
Once a school district's funding model amount is determined, there are a few different ways school districts actually get funded. It starts with finding out how much local revenue the school district will receive and ends with the state either making up the difference or collecting money from the school district itself.
"The Wyoming Constitution requires taxes to be levied in three ways to support school operations," said Cicarelli. "There are two operational levies that go straight to the school district -- the countywide 6-mill levy and the school district 25-mill levy. There's also a statewide 12-mill levy that goes to the State School Foundation Program Account."
A mill levy is the number of dollars a taxpayer pays for every $1,000 of assessed value on real property. To calculate the property tax, multiply the assessed value of the property by the mill rate and divide by 1,000.
Generally speaking, revenues from the countywide 6-mill levy and the school district 25-mill levy are distributed to county treasurers for deposit into the county school fund, along with other local revenues (e.g., fines and forfeitures). These revenues are then distributed to each school district. The revenues distributed to each district are counted as school district revenues and deducted from the funding model guarantee amount to determine the school district's state entitlement amount or the amount to be recaptured by the state. The statewide 12-mill levy revenues are collected by the State Treasurer and deposited into the School Foundation Program Account, which are then appropriated by the Legislature and distributed to school districts through the funding model.
If the local revenue collected by a school district is less than the guaranteed amount the funding model determines a school district is entitled to, the state funds the difference from the School Foundation Program account. If the local revenue collected by a school district is more than the funding model determines a school district is entitled to, then the school district pays the difference to the State School Foundation Program account.
"For example, if a school district's guarantee is $10 million from the funding model, but the school district receives $8 million from local revenues, the state is then required to pay the school district the $2 million difference to make school district whole. The state provides the $2 million in entitlement payments over a 10 month period from August to May," Cicarelli said.
Recapture and Entitlement districts
In Wyoming, there are two different types of districts - one that collects more local revenue than is needed to fund the amount guaranteed by the funding model (recapture school district) and one that collects less local revenue than is needed to fund the amount guaranteed by the funding model and relies upon the State to pay the difference (entitlement school district).
Recapture school districts actually pay the School Foundation Program Account twice a year - January 15 and June 15 through either an electronic funds transfer, or a bank check. Each recapture school district in the state, with the exception of Sublette County School District #1, must pay back 40 percent of their recapture funds in January. Sublette County School District #1 pays 50 percent. In all, Cicarelli said the state paid approximately $694 million to entitlement districts and received $217 million from recapture districts last year.
"For entitlement school districts, they are funded from both sides," Cicarelli said. "Country treasurers fund them three or four times per year through distributions, though that could vary a little bit, and the state funds them 10 times per year."
When they get paid
While the payments to recapture school districts from the county treasurer are a primary revenue source, the local revenue can sometimes come a little later than districts can wait. For that reason the state offers a short-term loan to some districts. Cicarelli said recapture districts tend to suffer through lean financial periods at the beginning and end of the fiscal year before county treasurer checks come in and during that time the state offers a bridge loan that is initially free of interest charges.
That loan is payable by December 15 without interest. If a school district decides to hold onto the money until its due date of June 15, they can do so with a six percent interest rate.
Entitlement schools are paid by the WDE 10 times per year through the state's accounting system - WOLFS.
Cicarelli points out that while school boards and school district leadership determine how they spend the money allocated by the state, there are some accountability measures, such as a law that requires a 16:1 student-to-teacher ratio in grades K-3. Failure to do so, or to receive a waiver from the Director of the Department of Education, could result in a district not taking part in School Foundation Program disbursements.
"The state is required to hold school districts accountable for the K-3 teacher ratio. There are some parameters that districts have to follow. That is one of the more notable parameters and pieces of legislation in recent memory. During the 2010 recalibration, the Legislature was adamant that those grades align with how schools are funded," he said.