Archived Information

DOE Budget

Board of Education FY03 Budget Request

M.G.L. c.69 s.1A requires the Board of Education to submit an annual budget request to the Governor and Legislature. download an Excel spreadsheet containing the Board's request for FY03, along with the actual appropriations for FY01 and FY02. Please note that the FY03 requests are subject to review and change during the legislative budget process.

Below are some explanatory notes relating to the various state aid programs included in the budget request.

1. Chapter 70

   Because of the state's current fiscal situation, the Board is proposing a significantly smaller increase in Chapter 70 aid (7061-0008) for FY03. The amount included in the budget request is only enough to ensure that (a) every district remains at or above foundation, taking into account enrollment changes and inflation; and (b) every district receives at least the same Chapter 70 aid per pupil as it is receiving in FY02.

   We are also assuming that the $5 million in one-time enrollment aid appropriated in FY02 (7061-0006) will be added to those districts' Chapter 70 base aid in FY03.

   We are hoping that agreement will be reached on a new, permanent Chapter 70 formula, either as outside sections of the FY03 budget or as separate legislation enacted in 2002. We would recommend that the new formula take effect in FY04, to give municipalities and districts sufficient advance notice of the changes. We also hope that the state's fiscal circumstances will allow us to fully fund all components of the new formula by FY04, including additional aid to above-foundation districts.

   Please note that the cost estimates for the Chapter 70 program are based on preliminary estimates of enrollment levels, inflation, and municipal revenue growth, and accordingly are subject to change.

2. School construction

   The amounts recommended for the first payment accounts ($7,303,260 for 7052-0003 and $12,948,960 for 7052-0004) reflect the expectation that the Board will limit FY02 grant awards to these amounts. The Board has also recommended the restoration of funding for emergency grants (7052-0007), which was cut in the FY02 budget.

   Because of uncertainty about FY04's fiscal prospects, we have not made a recommendation at this time as to the authorization levels for FY03 grants to be included in the inside language.

3. Special education

   The significant increase proposed for line item 7061-0012 reflects the implementation of the new circuit breaker reimbursement program on July 1, 2002. This program will replace the existing "50/50" residential school reimbursement program. Concurrent with this change is the elimination of the line item for payments to Northampton and Framingham (7053-1940), as the new circuit breaker program includes extra payments to communities having a significant number of hearing-impaired students.

   We are also proposing the elimination of the separate line item for abandoned children (7028-0302). This program has paid some special education costs for children without parents or guardians living in the Commonwealth; it has been criticized by the state auditor and by municipal officials for having been chronically underfunded. We propose to meet this obligation through the circuit breaker program. Under this proposal, districts would receive 100% of the costs above the three times foundation threshold for these children, regardless of type of placement. We believe this approach is fairer and also reduces the administrative burden on districts and the department.

4. Charter school tuition reimbursements

   Under the current program (7061-9010), sending districts are reimbursed for increases in charter school tuition costs over a three-year period (100% of the increase in the first year, 60% in the second year, and 40% in the third year). Because of the continued increase in the number of charter schools, as well as enrollment growth in existing charter schools, full funding of the current law would require $50 million in FY03. The Board's budget request is based on a proposed change in the reimbursement formula, with districts receiving 33% in the first year only.

5. Transportation reimbursements

   The Board has proposed a reduction in the regional transportation reimbursement account (7035-0006) to $46,944,000. This would provide a reimbursement rate of approximately 90%, compared to the 100% target of recent years. This proposal has been made for two reasons. First, level funding of transportation reimbursements for municipal (non-regional) districts (7035-0004) over a number of years has reduced the reimbursement rate for those districts to less than 25%, creating a significant disparity. Second, we are concerned that a 100% reimbursement rate does not provide districts with any financial incentive to control their transportation costs. It is suggested that the regional account be level funded at $46,944,000 for the next few years, until the rate drops to a more realistic figure, in the range of 75-80%.

6. State wards

   The state ward program (7061-0009) was not funded in FY02, and is not recommended for funding in FY03. It should be noted that state wards are included in districts' foundation enrollment counts, which are used to calculate chapter 70 aid. In addition, high special education costs for state wards will be reimbursed through the new circuit breaker program.

   We propose that homeless students placed in shelters or temporary housing in another town by DTA, who in the past were eligible for state ward funding, receive the same 100% reimbursement rate under the special education circuit breaker program as abandoned children.