In recent years the way state appropriations are distributed to school districts, generally referred to as “the average daily attendance (ADA) formula,” have been a hot topic among legislators, educators, and political leaders.

The “ADA formula” has been called antiquated, broken, confusing, and complicated.  It has been the subject of special legislative committees determined to analyze and revise it.  One replacement / revision concept that has gained popularity is the so-called “enrollment-based formula”.   Its advocates claim it will solve all the problems associated with the “ADA formula.”

Not true.  No formula change increases the amount of money in the pot to be distributed.

I was recently asked, “Who was responsible for the creation of the ADA formula, and why was it adopted?”   In large part, it happened on my watch, when I was State Superintendent of Public Instruction.  As to why it was created, I must take readers back in time to the mid-nineties.

As I approached the end of my fourth term as Idaho’s SPI in1994, I decided to attempt a vast improvement on the formula for distributing state financial support to individual school districts.  Up to that time, I had made several legislative attempts to improve the formula but was limited to a few marginal improvements.

But in 1994, I decided to develop and propose a major overhaul that would accomplish two goals: more equity and more relevance in how state appropriations reached school districts.

I knew from earlier attempts there were strongly held opinions that had to be overcome or satisfied.  The two major issues were:

1. The three remaining chartered school districts that had been created before Idaho’s statehood in 1890—Lewiston in 1880, Boise in 1881, and Emmet in 1885—did not want to give up their historic charter provisions granted by the Idaho Territorial Legislature.
2. Small school districts, mostly rural, wanted and needed extra state support to provide the same educational opportunities to their students that were being offered in larger school districts.

Consolidation of small districts had been discussed by the legislature but had been rejected for reasons of geography, travel, bond debt and political disagreements.

A third, and substantial issue was not related to the funding formula—it had become obvious that Idaho had two kinds of districts—wealthy and poor. Wealthy districts had high assessed market value, created by population, industry, commerce, and property.   Blaine County was, and is, a good example.  Blaine County was able to increase their annual budgets with local, voter-approved, tax levies.

In Blaine County, any school district increase in local taxes was minimal when spread over the district’s assessed market value.  It was, therefore, almost a given that Blaine County voters would approve operational and bond levies proposed by the Blaine County School Board.

On the other hand, districts with low assessed value, such as Snake River, which adjoins Blaine County, could not always count on voter approval for local tax levies because even a modest school district proposal meant significant tax increases for homeowners and businesses.

The most recent assessed property value (AV) table created by the Idaho State Department of Education reveals the AV difference between Blaine County and Snake River school districts.

Consequently, two types of school districts emerged—the so-called “wealthy school districts” and the so-called “poor school districts.”

This disparity was not caused by state funding.  Rather, it was a matter of local voters approving or rejecting special tax proposals.  It seemed none of the “rich districts” wanted to give up their local advantage to help a less fortunate “poor districts.”  The only way to smooth out these differences was to incorporate into the state’s funding formula what I called “essential elements” of operating a school, more specifically, what are the “essential elements” required for instruction inside a classroom?

To some, the idea of “essential elements” seemed complicated, but in practice it made sense.  To that end, I called together a special meeting of local superintendents with the task of identifying the “essential elements” that would become the foundation for Idaho’s school funding formula.

Adequate state support, distributed according to current operational costs of school districts, would DECREASE the reliance on supplemental levies.

The first essential element was, of course, the number of students to be served.  This evoked the debate over whether the distribution formula should be based on attendance or enrollment.

In the big picture, the school superintendents agreed that it made little difference.  However, Average Daily Attendance (ADA) is carefully recorded each day, whereas an enrollment number would require considerably more attention. For example:  Is a student dropped after so many days of absence?  To be counted, would a student have to attend for a specified number of consecutive days?

In 1994, we debated any advantage between ADA and enrollment, and we decided ADA was easier to manage than enrollment.  Even though both are important.

The second “essential element” answered the question, “Should ADA be weighted, to account for classification of students—elementary, secondary, special education, alternative education?”  In other words, does it cost more to educate a secondary school student than an elementary student, a special education student?

Weighted ADA received unanimous agreement.  The ADA formula had to consider the “type” of student being educated.  Therefore, it made sense that a special education classroom would have a weighted factor that would establish funding for a smaller number of students.

Another weighting factor was based on rural locations—the difficulty of small, in some cases, remote and necessary schools had to be considered.

Eventually we determined by a divisor what would be a reasonable number of teachers, non-certified support staff, and administrators for a school.  Then came the issue of the career ladder, beginning teacher salary, and a distribution of funds calendar that would smooth revenue to schools based on the first few weeks of schools when attendance was high, followed by the best twenty-eight weeks of attendance, and, of course, a safety net in the event of loss of students or school closures.

In every respect the ADA formula provides state funding that “follows the student”, despite what some legislators and educational leaders claim.  Everyone who worked on the ADA formula knew that every few years it would need revision to ensure it would reflect current school operations.

This was never done and now we find ourselves badly out of step with the reality of educational needs.  For example, everyone knew the number of special education students was increasing dramatically, as was the cost of special needs services.  Yet, despite the warnings, no fundamental changes were made.

Consequently, Idaho is now facing a crisis in special education funding.  A similar funding gap crisis exists in terms of staff allowances.  There was ample warning to keep the ADA funding formula current, yet for thirty years this had not been done.

Individual legislators have sought formula changes, and the legislative body has appropriated $400,000 for research and recommendations on revisions.  This expenditure was a complete waste of taxpayer money, as no significant action was ever taken.  Failure to heed the warnings for periodic review has led to the current situation which could aptly be referred to as “a mess.”

Idaho House of Representatives Speaker Mike Moyle is hoping in another legislative session a new funding formula can be created where there are no winners or losers.  He is dreaming, unless the public-school appropriation is significantly increased, thereby guaranteeing every district receives an increase that sustains quality and equalizes the local levy gap.

My memory may be faulty, but as I recall this was the situation in 1994 as well, when those with the greatest advantage received about a 3% increase while those with the greatest disadvantages increased by nearly 25%. with the public-school appropriation increased about 18%.

There needs to be a complete understanding that the funding formula does not create money and that a significant public-school appropriation will be necessary to make every district a winner.  The legislature has done nothing for nearly ten years to improve the funding formula and every year it deviates further from the actual operation of schools.

I have said in jest that, “Give me a half dozen local superintendents that understand school finance beyond their own district and, with the required relevant information, in one day we could dramatically improve what the legislature hasn’t been able to do for nearly ten years.  There is no magic update to the funding formula without a historic state appropriation increase that finally recognizes our competitive “dead last” ranking in terms of school funding.

Let school finance practitioners who are recognized by their peers as “finance experts” address the “essential elements” of the ADA funding formula and then let the politicians do their job—appropriate the necessary money so every student in every school district has opportunity to experience the quality education they need and deserve.