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Where Do Dollars for Public Schools Come from in Virginia?

Oct 08, 2024 04:30PM ● By Martin Davis

This would seem like a simple question, and in one sense, it is.

School systems in Virginia receive funding from three sources: Federal government, State government, and Local government.

Here’s a breakdown of how much each of these contribute, according to educationdata.org.

 

How the amounts that state and local governments must provide are determined, however, is far from simple.

State Funding

Virginia is just one of a handful of states that figures the state allocation based not on the number of students, but the amount of staffing a school is expected to require. This is referred to generally as the SOQ (Standards of Quality). Note: There are actually seven standards of quality – only one is used to determine funding levels.

The funding formula is complex and has in recent years come under fire from across the political aisle, leading to serious talk of funding reform. For an in-depth look at the formula, you can access this dated PowerPoint presentation on the Virginia Department of Education website.

There are three basic parts:

1.      Determine the total number of staff positions per school division

2.      Determine the cost to fund that staffing level

3.      Divide that total between the state and local governments based on localities’ ability to pay.

(This summary is based upon a Washington Post piece, “Virginia underfunds K-12 education with flawed formula, report finds”)

The SOQ funding formula, however, works in concert with what is known as the Local Composite Index, or LCI, which is determined every two years. It sets the amount of a district’s schools budget the locality should pay.

Locality Funding

Local funding is also set by the state and is known as the Local Composite Index, or LCI.

Like SOQ, the LCI is a complex formula that is not easily understood. However, it is based on the following factors, according to the Virginia Department of Education:

  • True value of real property (weighted 50 percent)
  • Adjusted gross income (weighted 40 percent)
  • Taxable retail sales (weighted 10 percent)
  • Each locality's index is adjusted to maintain an overall statewide local share of 45 percent and an overall state share of 55 percent.

This funding has drawn considerable attention. The LCI works in tandem with the SOQ to ensure that statewide, local funding accounts for 45% or education dollars and state funding 55%

The Virginia Municipal League has regularly noted that there are two major challenges for localities with the LCI:

·       LCI does not measure students’ educational needs. Instead, it effectively suppresses the state’s funding obligation.

·       A single change to the formula to one school division’s LCI affects, either positively or negatively, all school divisions.

Shortchanging Virginia Schools

For the reasons listed above, and more, Virginia has historically lagged neighboring states in adequately funding public schools. That was the conclusion reached by a study conducted in 2024 by the Joint Legislative & Audit Review Commission, which said:

“Virginia school divisions receive less K–12 funding per student than the 50-state average, the regional average, and three of Virginia’s five bordering states (figure). School divisions in other states receive 14 percent more per student than school divisions in Virginia, on average, after normalizing for differences in cost of labor among states. This equates to about $1,900 more per student than Virginia.”

Where does your school stand?

This complex system means that funding per pupil varies widely not only from district to district, but from school-to-school in the same district.

To see where your school or district falls in funds received from state and local governments, you can easily discover this information by going to the Edunomics Lab, which is housed at Georgetown University.

 

 

Martin Davis is Editor-in-Chief of the FXBG Advance, our sister nonprofit newsroom. For more of its outstanding coverage of education issues go to fxbgadvance.com.

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