Education

Special Education Programs – Special Education Excess Costs

Statewide Outcome(s):

Special Education Excess Costs supports the following statewide outcome(s).

Minnesotans have the education and skills needed to achieve their goals.

Context:

This state aid program provides a “safety net” for districts that experience high costs for special education services which are not reimbursed by regular special education aid. Specifically, this activity helps students with a disability access free and appropriate public education without requiring school districts to subsidize special education costs excessively from general operating funds. In small school districts, the unreimbursed costs of serving a few high-cost students can have a severe impact on the district’s general fund. High concentrations of special education students can create similar problems in larger school districts.

Strategies:

Excess cost aid targets a portion of special education funding to districts with the greatest excess cost as a percentage of total general revenue. By considering the overall impact of unreimbursed special education costs on a district’s general fund budget, the program is more effective in addressing excess costs than narrow programs. A district’s initial excess cost aid equals 75 percent of the difference between the district’s unreimbursed special education cost and 4.36 percent of the district’s general revenue.

The state total excess cost aid is capped in law, and the aid for each district is adjusted to limit the total aid to the statewide cap amount. For FY 2012 and later fiscal years, the state total excess cost aid equals the state total special education aid for the preceding fiscal year times the program growth factor times the greater of one, or the ratio of the state total average daily membership (ADM) for the current fiscal year to the state total ADM for the preceding fiscal year. The program growth factor is 1.02 for FY 2012 and later years.

Results:

MDE uses a general set of performance measures to determine the impact of the state’s special education program as a whole. As a result, the measures here reflect the impact of MDE’s entire special education program, including, but not limited to, the Excess Cost program.

Performance Measures Notes:

1.     Previous Data: FY 2010 / Current Data: FY 2011

2.     Previous Data: 2008-2009 school year / Current Data: 2009-2010 school year. Later data is not yet available.

3.     Previous Data: 2010-2011 school year / Current Data: 2011-2012 school year

4.     Previous Data: FY 2009 / Current Data: FY 2013 (estimate)

5.     Previous Data: FY 2009 / Current Data: FY 2013 (estimate). The cross subsidy is the amount of special education cost not funded by state or federal special education aid or the portion of general education revenue attributable to special education students served primarily outside of the regular classroom. School districts use unreserved general fund resources to cover these unfunded special education costs.

6.     Previous Data: FY 2009 / Current Data FY 2013 (estimate). There is significant variation among school districts in the amount of unreserved general fund revenue per student needed to cover unfunded special education costs. All else equal, districts having relatively large special education cross subsidies per student are at a competitive disadvantage compared with other districts in providing regular education programs.