News From the Capitol, Apr 23, 2021

2021-04-23 | Michigan Association of School Boards

  • House Appropriations Considers Supplemental Budgets for Federal Funds
  • House and Senate Release 2021-2022 Budgets
  • School Bus Safety Bills Advance to the Senate
  • House Passes Changes to Public School Employee Retirement System
  • Registration Open for NSBA's Advocacy Institute

House Appropriations Considers Supplemental Budgets for Federal Funds

On Wednesday, the House Appropriations Committee began discussion on three bills to distribute much of the federal funds Michigan has received from the last two stimulus packages.

House Bill 4419 distributes funds to the Michigan Department of Education as well as six other departments. MDE receives $1.5 billion for child care programs. The largest amount of funding, $767.7 million, goes to changes to the child care development block grant to expand eligibility for families to receive assistance, waive family copays until September 2022, increase provider reimbursement rates, mental health consultations for providers and to pay providers based on enrollment rather than attendance.

House Bill 4420 distributes $3.2 billion to the remaining 13 departments. None of the funding in this bill affects education.

House Bill 4421 distributes $4.2 billion through the School Aid Fund. $840.7 million is distributed through the Title 1A formula as required by the federal law. This bill also includes an “equalization payment” similar to the one included with the first supplemental, House Bill 4048. The rate is increased to $1,093 per pupil, meaning the state will guarantee that every district receives at least that amount.

The money received under this payment does include spending requirements:

  • 50% must be dedicated to activities to address learning loss;
  • 10.3% must be used for implementation of summer enrichment programs; and
  • 10.3% must be used for the implementation of afterschool programs.

The bill also includes $45 million for HVAC updates in districts that implement a balanced calendar program in at least one of their building for the 2021-2022 school year and includes $10 million in payments direct to parents for summer programming expenses. We believe Gov. Gretchen Whitmer will veto this line item once again.

Finally, the bill includes a requirement that the Governor sign policy legislation in order for the funds to be released. This time, all of the funding except the payments to parents is tied to House Bill 4082 being signed into law. This bill caps the amount of funds the Governor can transfer through the administrative board process at $200,000 before needing legislative approval. This is not as divisive as the proposed limits on the Michigan Department of Health & Human Services epidemic rules that we saw in the last round and, at this point, we do not know the Governor’s position.

The bills are expected to be approved by the House Appropriations Committee next week with swift passage by the full House. The Senate will then begin its deliberations.

House and Senate Release 2021-2022 Budgets

On Thursday, both the House and Senate K-12 Appropriations Subcommittees released and approved their versions of the School Aid and Department of Education budgets for 2021-2022. The budgets are now before the full House Appropriations Committee for its consideration next week.

The Senate version of the MDE budget includes a $400,000 line item to reimburse school board members for qualified training courses, up to $100 per course. We have talked about something like this for the last few years and are pleased that we could work with the chair of the subcommittee, Sen. Wayne Schmidt (R-Traverse City), to create specific language for the budget. Courses would have to cover specific issues and MDE would create a process for a program to qualify. We’ll be watching this item closely and pushing for it to be included in the final budget.

The House version of the MDE budget establishes quarterly budgets, releasing only a quarter of the available funds in this bill and requiring subsequent budgets to be passed. It also cuts five full-time positions. This is a tactic that the House employed throughout most of the departmental budgets.

On the School Aid side, the Senate included a per-pupil foundation allowance increase of $125-250 through the 2x formula. The House included $50-100 also using the 2x formula. However, the House also includes a one-time, per-pupil payment of approximately $120; this is in addition to the per-pupil foundation allowance. Neither budget includes the one-time appropriation for declining enrollment districts.

We are still working through the details of each budget and will have a comparison document put together by early next week. We will post it on our website for your review and appreciate your patience as we read through these long budgets.

The next Consensus Revenue Estimating Conference is set for May 21, 2021. This will give the Legislature and the Governor the final revenue figures with which to set the final budget. We urge you to continue to talk to your legislators about the timeliness of final budget decisions and the need to have the school budget completed in June or even earlier.

School Bus Safety Bills Advance to the Senate

Earlier this week, the House of Representatives overwhelmingly approved a package of bills that would improve safety for students riding on school buses. House Bills 4201-4204 would do the following:

  • Set the penalty for boarding a bus without permission of the driver as a civil infraction punishable by up to a $500 fine.
  • Set specific categories for who can board a school bus.
  • Establish a civil infraction penalty for impeding the progress and/or operation of a school bus. 
  • Allow stop-arm cameras to be installed on school buses and allow for video or a photograph to be used as evidence for law enforcement prosecuting illegal passage of a school bus.
  • Makes failure to stop a civil infraction punishable by up to a $500 fine. 

The Legislature has been working on this issue for well over year and the bills received bipartisan support in the House. MASB supports this package because it will increase safety for students as they travel back and forth to school. The legislation is now before the Senate Transportation and Infrastructure Committee.

House Passes Changes to Public School Employee Retirement System

On Tuesday, the House of Representatives passed House Bill 4263, which would make several changes to the Michigan Public School Employee Retirement System. The proposal would require layered amortization which would recalculate the amount of debt owed each year while making sure the debt is paid off by a certain date. The bill would also require that the system use more accurate mortality tables and caps the assumed rate of return from 8% to 6.8 and 6.95% depending on the plan.

The bill uses a more conversative approach than currently in place to ensure the state is properly planning to pay of the long-term debt. The goal is to help keep the state on track to pay of our long-term liability on schedule. The bill passed unanimously by the House and was referred to the Senate Appropriations Committee.

Registration Open for NSBA's Advocacy Institute

The National School Boards Association's 2021 Advocacy Institute will be held virtually from June 8 – 10. Registration is now open and early bird pricing is available until April 30. NSBA is excited to provide this online experience focused on school board members' issues and priorities.

Due to it being an online event, MASB will not be hosting its usual kick-off lunch. However, we are trying to coordinate a virtual event with Sens. Debbie Stabenow and Gary Peters to replace our customary breakfast. We hope you will join school board members from around the country for this advocacy event.