FLINT, MI — The formula used to funnel some special education dollars through the Genesee Intermediate School Distrct to local districts violates state law, an administrative law judge has said.
For Flint schools, this could mean the district will get more special education funding because it has a higher than average percentage of special education students. It also could mean less money for school districts with a high total student count but lower percentage of special education students, like Grand Blanc Community Schools.
As it currently stands, the GISD Mandatory Plan appropriates $3.8 million of Act 18 special education funds back to local districts based on a three-part formula: 1. Total special education headcount 2. Full-time-equivalent (FTE) special education student head count 3. Total FTE headcount. FTE head count is adjusted for part-time student numbers. These three factors are currently equally weighted.
However, Administrative Law Judge Michael St. John in a Friday, Oct 9 recommendation to State Superintendent Michael Rice, said this formula should change.
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The Flint Community School district has said it is unfair to include total FTE as one third of the formula because it disadvantages the city district, which once was the largest in the county but has since lost ground to suburban districts.
GISD Superintendent Lisa Hagel testified that all three factors, including FTE, are of equal importance.
“However, the funding formula does not provide equal funding for the three factors,” St. John wrote in his recommendation. “Because the three numbers are simply averaged together, the larger number of FTE students dwarfs the smaller SEHC number and substantially dwarfs the much smaller SEFTE number. Rather than using relative percentages of each factor, they are simply added together and then divided. FTE therefore dominates both the numerator and the denominator in the current formula resulting in a skewed distribution of funds.”
St. John added that Hagel’s concern that altering the plan would result in less money for some special education students in some districts was also “heartfelt and entirely legitimate.”
The current GISD plan is in violation of state law because it does not meet the individual needs of each student with a disability, particularly those special education students attending Flint Community Schools, St. John wrote. He said the plan is also arbitrary and capricious.
However, he did not suggest removing FTE entirely as a factor for allocation of funds. Instead, St. John suggested weighting the three factors to ensure that the total student count in a district does not outweigh the number of special education students.
“It is the sincere hope of the Administrative Law Judge that the parties can come together to work through their differences toward their common goal of educating all students in Genesee County,” St. John wrote.
The GISD appreciates the thoughtful review and recommendation made by Administrative Law Judge St. John to State Superintendent Rice, GISD Associate Superintendent Steven Tunnicliff said in a statement to MLive/The Flint Journal.
“The recommendation would create a new formula that is neither the current formula used, nor the formula recommended by Flint Community Schools in their formal objection,” Tunnicliff wrote. “As the GISD has repeatedly noted, the Act 18 formula is a collaboratively developed and approved formula, involving the 21 local school district superintendents, 15 public school academy leaders, and our countywide parent advisory committee. To that end, the GISD will work with each of these groups, as well as legal counsel, to guide our next steps in this process.”
St. John outlined an option with formula weighted 86.5% total special education headcount 11.5% full-time-equivalent (FTE) special education student head count and 2% total FTE. If this was the formula in the 2019-2020 school year, Flint would have received $441,081 in Act 18 funding rather than $253,456, a 74% increase and difference of $187,625.
Without total FTA factored into the formula, Flint schools would have received $549,409 rather than $253,456, a 116.77% and difference of $295,953.
It is about the money but it’s more about fair and equitable treatment for everybody, Flint Community Schools Board of Education President Casey Lester said.
“This isn’t ‘dollars driven’ this is ‘let’s make things fair,'” Lester said. “Let’s treat people how they should be treated. That’s more the driver and not as much the dollars that are attached to that.”
Other districts, including Carman-Ainsworth Community Schools and Flushing Community Schools could also get more Act 18 money through the change in formula.
“Our ultimate goal is to get a formula that better fits, not just our school district, but other districts that have been severely impacted,” Lester said.
The formula has not been modified since 2013 when FCS had a population of 7,207. Since then, the city district has lost nearly 4,000 students.
Last year, around 23% of Flint schools students had special education needs. Former Flint Superintendent Derrick Lopez attributed the inflated cost to educate special education students in part to the district’s $5.2 million yearly structural deficit. He said special education students cost up to two times that of a student without special education needs.
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Voters passed a $30.62 million bond in March that eliminated much of the district’s financial concerns. The district originally was considering closing schools.
Special education funding for Michigan schools
Special education funding in Michigan schools is a complicated topic.
In a prior statement to MLive, Tunnicliff said “that the costs of educating students with special needs is significant and that schools across Michigan lack the funds needed to cover such costs.”
Special education dollars are appropriated through four main methods, he said, including through the Individuals with Disabilities Education Act federal flow-through fund, state funds as part of the per-pupil foundation allowance, county-wide special education millage funds (center-based programs and Act 18 disbursements) and Medicaid reimbursement for school-based services.
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IDEA federal flow-through funding is based on a special education headcount. The GISD receives these federal dollars and disburses them based on these federal guidelines.
State of Michigan per-pupil foundation allowance is based on headcount and a categorical reimbursement rate to assist with special education costs.
Through a county-wide special education millage, Genesee County levies 2.3973 mils on all properties. These tax dollars are then disbursed according to the Genesee Intermediate School District Mandatory Plan. According to the Mandatory Plan, the costs of operating center-based programs and services for children across Genesee County with the most significant impairments are addressed first. These programs are operated by the GISD and serve students across the county.
In addition, an annual special education millage payment to each constituent district (and public school academy) is distributed to assist with the local district costs for special education services, which a accounts for the $3.8 million will be disbursed to local school districts.
Medicaid reimbursements captures revenue through the Medicaid School-Based Services Program.
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