Special Education Simplified – SPED Series, Part II

As Arizona’s K-12 enrollment has grown, including students with disabilities, our school finance formula has stayed relatively unchanged. It has not fully addressed recommendations made in a 2007 special education cost study[1] nor has it kept pace with the 5 percent increase in our special education population, as we found in our first blog. The Center investigated the current funding formula to understand how special education students are funded and how the funding mechanism is impacted by increases in student enrollment  in order to determine whether it serves the needs of our special education students.

Arizona’s school funding formula addresses special education funding using two separate mechanisms. The first funding mechanism, called Group A[2], provides funding for every student in the state, regardless of special education designation. This portion of funding is designated for a particular group of special education students as well as other programs like gifted, career exploration, and remediation programs. Group A funding is distributed to all schools based on the total student enrollment; each student receives an identical weight in the funding calculation. The second funding mechanism, called Group B[3], provides funding according to the most severe special education category identified in students’ Individual Education Plans. The Group B categories and their definitions are presented in the following table:

The Findings

Like the overall system, these two funding mechanisms are directly impacted by total population growth (Group A) and special education population growth (Group B). The Center set out to analyze the current special education enrollment and funding data to determine how these dollars are allocated within the designated categories.

According to the FY15 school finance data[4], Arizona has 121,602 identified special education students, representing 11 percent of the state’s student population.  The distribution of students by special education category – Group B designation – is presented in the following table in order of severity (least to greatest) and their relative funding weights (lowest to highest). The student count represents the total number of identified students, based on their Individual Education Plan. The weight identifies the multiplier that is used in the funding formula found in A.R.S. § 15-943; each category has an associated weight. This multiplier generates the weighted student count, which is then multiplied by the base funding level of $3,373.11 for most charters and $3,415.27 for most districts. The associated funding levels by category and per pupil allocations are a result of the funding formula.

This shows 84 percent (102,142) of the state’s special education population are identified as having emotional disabilities, mild intellectual or learning disabilities, speech impairments and other health impairments. This group of students is funded by both the Group A and Group B portions of the formula.  As evidenced in the table, the small funding weight (.003), results in a weighted student count of 306 students.  In other words, this large group (102,142) is funded as if there were only a small number of students (306) in the state with these characteristics. The result is a per pupil amount of $10.24, in addition to Group A funding.

The remaining 16 percent of special education students (19,460) are funded as significantly higher weights given their designations.  Students diagnosed with multiple disabilities and severe sensory impairments (MD-SSI) are identified as the most significantly impacted group and therefore receive the highest funding weight.  As evidenced in the table, the large funding weight (7.947), results in a weighted student count of 6,008 students.  In other words, this small group (756) is funded as if there were a large number (6,008) in the state with these characteristics.  The result is a per pupil amount of $27,149.88.

While $10,781 to $27,149 may seem like a lot of money for each special education student, the implementation of the current funding formula lacks an understanding of the needs, and recent estimates of the actual costs of serving special education students.  The 2007 cost study recommended both increases to the Group A and Group B weights to account for the expenses incurred to support students’ needs.  However, we know that the needs identified in 2007 have not been properly addressed and it’s likely that these needs have changed in the last eight years. Policy makers should consider the current categories and funding weights as they make recommendations for future modifications.

This is Part II in the Center’s series on Special Education funding. Read Part I here.

Footnotes/References
[1] Special Education Cost Study at: http://www.azed.gov/specialeducation/files/2011/06/specialeducationcoststudy2007.pdf
[2] “Group A” means educational programs for career exploration, a specific learning disability, an emotional disability, a mild intellectual disability, remedial education, a speech/language impairment, developmental delay, homebound, bilingual, other health impairments and gifted pupils pursuant to A.R.S. § 15-752.
[3] “Group B” means educational improvements for pupils in kindergarten programs and grades one through three, educational programs for autism, a hearing impairment, a moderate intellectual disability, multiple disabilities, multiple disabilities with severe sensory impairment, orthopedic impairments, preschool severe delay, a severe intellectual disability and emotional disabilities for school age pupils enrolled in private special education programs or in school district programs for children with severe disabilities or visual impairment and English learners enrolled in a program to promote English language proficiency pursuant to A.R.S. § 15-752.
[4] Special education funding data were used for this analysis, specifically student counts that are used for the calculation of the state equalization formula for fiscal year 2015. Student counts are provided by each Local Education Agency (LEA) to the Arizona Department of Education (ADE) and can be found in LEAs’ individual APOR (districts) and CHAR (charters) reports. Student counts are found at: http://www.ade.az.gov/Districts/EntitySelection.asp. It is necessary to download reports one LEA a time.

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