Public School Funding FAQs
How are public schools funded in Colorado? K-12 public schools in Colorado are primarily funded through a combination of local property taxes and state revenues. Historically, local property taxes have made up the majority of funding. However, since property taxes have decreased and will continue to do so based on the impact of the constitutional Gallagher Amendment (see TABOR/Gallagher FAQs as well as the Mill Levy Stabilization FAQ), the state has been required to fill in the amount that property taxes used to cover. During the post 9/11 economic downturn, state revenues fell dramatically and the state contributed the bare minimum legally required by Amendment 23 (Colorado spends $1,397 less per pupil than the national average.). Until 2011, the amount of funding Colorado’s public schools receive is based on the formula: inflation + 1%. The intention of this formula is to allow K-12 schools to keep up with price increases (inflation) while adding the 1% to slowly bring the funding level up toward the amount we spent in 1989 (inflation-adjusted) and toward the national average. This modest formula was an integral piece of Amendment 23, approved by Colorado voters in 2000. Annual State Funding Increases: 2005-06: 1.1% | 2006-07: 3.1% | 2007-08: 4.6% | 2008-09: 3.2% The Consumer Price Index upon which Amendment 23 is based does not adequately take into account some of the items that are most important to school districts such as: energy costs for gasoline or electricity, pensions and health care insurance—which have experienced double-digit inflation for the last few years. Just like it is more expensive to heat our homes or pay for family health insurance, schools have to deal with these skyrocketing costs, while receiving low, single-digit increases in funding (Even these modest increases are now in jeopardy). How do schools cope? Since they must provide transportation for kids, heat the buildings, and provide benefits to their employees, most school districts are forced to make cuts that affect the classroom: cutting programs and course offerings, increasing class sizes, deferring text book purchases, letting teachers and/or paraprofessionals go, and freezing their pay. To hear first-hand how schools are coping, explore Great Ed’s Interactive School Stories Map here. Are there other ways school districts can raise revenues? School districts can raise additional revenues through local bond (capital) and mill levy (operations) elections up until a specified level, but the economic vitality of many communities cannot support money raised through local bonds and mills. On the other end of the spectrum, wealthier school districts bump up against maximum spending caps that limit the local ability to support schools—caps that were designed to prevent massive inequities between low-income and affluent districts. Additional funding for public schools comes from private fundraising, primarily at schools in higher income communities – functioning as an additional “tax” on these families and further heightening equity concerns. Such fundraising efforts are increasingly being outstripped by funding cuts at the state and district levels. What is the State Education Fund? The State Education Fund was created by Amendment 23 in 2001 to help schools buy textbooks, reduce class sizes and retain critical staff, and to ensure that the State would be able to keep up with the mandatory Amendment 23 per pupil increases in later years. A small percentage of Colorado’s income tax (.33%) is deposited into the State Education Fund. However, the State Education Fund was raided in the post 9/11 budget crunch in order to support general operating expenses (see Amendment 23 FAQs). Why do districts face budget cuts even though K-12 funding has been taking an increasing portion of the state budget? As noted above, total state funding of K-12 funding will actually decrease in 2010-11. However, in past years, schools were facing budget cuts even though state K-12 funding was increasing and was taking an ever-increasing portion of the overall state budget. Here’s why:
Which is more important — supporting my local mill election or working on the state funding issue? Both. The systemic defunding of schools over the past two decades has eroded both local and state support. Ultimately, our students won’t get the quality education and opportunities they need to succeed until we fix Colorado’s broken funding system at the state level. But until then, every community (and school) has to do what it can to protect students from the impact of deeper cuts. Does Colorado fund any of the cost of kindergarten? Colorado currently funds kindergarten students at 57% of per pupil funding. Until 2008, Colorado’s School Finance Act was based on an assumption that children would attend kindergarten only for half days; kindergarten students were funded at 50% of per pupil funding to reflect the shortened day. With more and more research indicating that full-day kindergarten is critical to students’ early education and long-term academic success, the state legislature in 2008 decided to increase the percentage of per pupil funding for kindergarten gradually over time until it reached 100%. Unfortunately, shortly after beginning these funding increases, the Great Recession hit and the resulting state budget crisis have left the kindergarten funding increases stalled at 57% of full student funding. Most districts provide full-day kindergarten nonetheless, mostly through a combination of tuition on a sliding-scale basis and money moved from within the existing budget. More information available here:
https://www.greateducation.org/statistics-faqs/funding-faqs/
Colorado’s per pupil spending continues to fall further from the U.S. Average (recent U.S. Census audited data). In FY 2016-17, Colorado was more than $2,300 below the U.S. Average. The state now ranks 40th, down from 39th last year, in per pupil spending. This chart and a link to the US Census Bureau’s most recent report on school spending are available here: https://cosfp.org/. ![]() |