House Republicans passed a School Aid Fund budget on Wednesday that substantially increases per-pupil funding but wipes out categorical funding for several state programs, including universal meals, transportation, literacy programs and mental health services.
Local districts should be allowed to choose how to spend state funding, House Appropriations Chair Rep. Ann Bollin (R-Brighton) said.
“This is about putting something forth that makes sense for the kids in Michigan to be educated and for our local districts to empower them to make better decisions,” Bollin said. “We’ve had a lot of dictates from Lansing … this allows money to go back to the school district where the locals can decide.”
Calling it a “tranformational” budget in a statement, Bollin said it is a step forward for Michigan families. “I’m proud of all the hard work that’s gone into it.”
Bollin and House Republicans argued that the proposed increase in per-pupil funding to $12,000 per student offsets eliminating categoricals, but House Democrats and educational interest groups across the state called the proposal unserious and said it fundamentally weakens public education in Michigan.
“To put it plainly, the budget proposal put forth by the House is not serious and will set back a decade of progress toward timely education budgets that address the needs of our most vulnerable students,” said a joint statement from the Michigan Association of School Boards, Michigan Association of Superintendents and Administrators, Michigan Association of Intermediate School Administrators, Michigan Association of Secondary School Principals, Michigan Elementary and Middle School Principals Association, Michigan Association of Administrators of Special Education, K-12 Alliance of Michigan and Education Advocates of West Michigan.
The budget bill, HB 4577 , passed the House 56-53, with Rep. Steve Carra (R-Three Rivers) and Rep. Josh Schriver (R-Oxford) voting against their party’s budget.
To reach the $12,000 per-pupil, the House’s plan calls for a $10,025 foundation allowance, above the $10,000 per pupil recommended by Governor Gretchen Whitmer and the $10,008 passed by the Senate. Then, on top of that, Republicans create a new $3.1 billion pot of funds, broken down as $2.7 billion to districts in an estimated $1,975 per pupil, $314.4 million to intermediate school districts in an estimated $228 per pupil and $40.8 million in General Fund dollars to nonpublic schools.
The new $3.1 billion per-pupil category appears to be funded through$1.2 billion in changes involving the Michigan Public School Employees Retirement System, cutting about $1.45 billion by eliminating other categorical funding and pulling about $1 billion from the School Aid Reserve Fund and other reserve funds and moving those dollars to the School Aid Fund.
Adult education is another categorical defunded under the bill.
Designating $40.8 million for nonpublic schools as part of the state budget could be legally dodgy, as the state Constitution forbids using School Aid Fund money for nonpublic schools, but House Republicans may have court precedent on their side.
The bill language designates the money for school safety, mental health support, literacy professional development, student-teacher stipends and robotics programming.
The Constitution prohibits the use of public money to “aid or maintain any private, denominational or other nonpublic, pre-elementary, elementary or secondary school.” It further forbids aid “to support the attendance of any student or the employment of any person at any such nonpublic school or at any location or institution where instruction is offered in whole or in part to such nonpublic school students.”
However, Michigan courts have found the state can appropriate funding that is incidental and non-instructional in character.
During the 2010s, the then-Republican majority, with the support of Governor Rick Snyder, appropriated about $2 million annually to non-public schools to comply with the cost of implementing state health and safety mandates. Public schools sued, citing the constitutional prohibition on public aid to nonpublic schools.
But the Court of Appeals in 2018 ruled that such spending is legal, saying those funds for the purpose of advancing the safety and welfare of students were required by state law and incidental to teaching.
In 2020, the Supreme Court deadlocked on the case, letting the Court of Appeals decision stand.
Since that time, the court has shifted from a 4-3 majority of justices nominated by the Republican Party to 6-1 Democratic.
Bollin said she didn’t believe there would be a constitutional issue.
“It’s something I fully support,” she said. “I don’t expect litigation. I think we’ll do the right thing, and we’re going to start really supporting students.”
Rep. Tim Kelly (R-Saginaw Township), chair of the House Appropriations School Aid and Department of Education Subcommittee , welcomed legal challenges.
“If they want to sue, sue,” he said.
The proposed School Aid Fund budget is intended to provide a “shock to the system,” Kelly said.
“We need a shock to the system that recalibrates the discussion on parity, equitable funding and solidifying that dollars follow the child,” he said.
As part of that effort, Republicans added boilerplate language that would institute a 20 percent penalty against per-pupil funding if the district uses a curriculum that includes “race or gender stereotyping” or uses state funding for “DEI initiatives.” The budget boilerplate defines “race or gender stereotyping” as a set of statements, beliefs or ideas that adhere to the idea that all persons in a racial or ethnic group or gender “hold a collective quality or belief,” that individuals act in certain ways because of their race or gender, that persons are born racist or sexist because of their race or gender, that individuals bear collective guilt for historical wrongs committed by their race or gender, among other factors.
“We want to get rid of this identity politics stuff,” Kelly said. “It hasn’t improved student performance. … It was a tried and failed system.”
Districts would face the same 20 percent penalty for allowing transgender girls to participate in girls’ sport or providing multi-stall unisex bathrooms.
“In our policy statements, we are talking about education, and we want everybody to feel welcome to come in and get a good education,” Bollin (R-Brighton) said.
Although House Republicans suggested cutting funding for school meals and other programs, they argued that federal funding was not going away, citing SNAP benefits and at-risk funding.
“The money is still there,” Kelly said. “We didn’t roll up, didn’t do anything about the federal lunch program, but the state program, we gave them flexibility. They want to operate the breakfast and lunch program as they do, continue to do so.”
Throughout appropriation committee hearings Wednesday morning, many Republicans seemed to acknowledge that details would need to be worked out in negotiations, with Kelly going so far as to say that what passed the House on Wednesday would not be what the final budget would look like.
“We’ll see what we end up with,” he said. “Whatever passes off the floor in the House today isn’t going to be what we vote on in the final budget. I understand that. Everybody knows that, but this is our opening bid.”
Still, Kelly said that Democratic budget proposals were “chasing” House Republicans.
“We’re the North Star,” he said. “Everybody likes a large foundation allowance.”
Bollin said she was committed to fighting for a version of the School Aid Budget that reflected what Republicans passed on Wednesday.
“I hope the final budget looks very similar,” she said. “You’re going to see the record increased in student per-pupil foundation and giving more flexibility to districts. I’m going to continue to fight for what you see in our bills.”
House Democrats, who introduced their own educational budget proposal on Tuesday, stood in firm opposition to the Republican plan.
Rep. Alabas Farhat (D-Dearborn), minority vice chair of the House Appropriations Committee , called the Republican proposal a “partisan budget designed to win Republican votes” and a non-starter for negotiations with the Senate.
“You want to talk about a starting point. Your starting point should be your best end,” he said. “Clearly, today, they have conceded themselves that there’s a lot of stuff has been worked on negotiations.”
Farhat said his caucus was not against eliminating categoricals, but it was important to keep designated funding for items like transportation, early childhood education, literacy and school meals.
“Categoricals are a form of accountability,” he said. “If I give you x dollars for y outcome, I expect that to happen. If I give you x money for breakfast and lunch to make sure kids are fed, I expect y number of students to be fed.”
Neither House Republicans nor Democrats could say whether passing the School Aid Fund budget out of the House on Wednesday put them any closer to reaching an agreement with the Senate by the July 1 statutory deadline.
“A lot is in play right now, and I’m not so concerned necessarily about setting the targets,” Bollin said. “We’re just going to continue, one foot in front of the other, in working through the issues.”
By Elena Durnbaugh; Zach Gorchow contributed
