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Virginia Board of Education Prescribes New Standards of Quality and Finance Committees Hear Updated Rebenchmarking Figures

On October 16 and 17, 2019 the Virginia Board of Education (VBOE) met to finalize their revisions to the Standards of Quality (SOQs), which set minimum requirements that must be met by all local school divisions for K-12 education in Virginia. The Board voted unanimously to prescribe the revised SOQs to the Governor and General Assembly. If enacted in their current form, the fiscal impact to the state and local governments would approach $1 billion.

As previously reported, VBOE reviews the SOQs every two years and typically submits their recommendations for consideration by the General Assembly in September or October as mandated by Article VIII, Section 2 of the Constitution of Virginia. However, unlike previous years, VBOE unanimously passed a resolution prescribing the SOQs. The last time VBOE took this action was in 1982. Two years later, the General Assembly codified the SOQs and VBOE submitted recommendations thereafter.

VBOE members have expressed frustration that VBOE’s constitutional recommendations have been disregarded or under-funded in previous biennia by the Governor and General Assembly. Furthermore, VBOE claims that since 1988, the General Assembly has passed 197 pieces of legislation amending the SOQs. As such, prescription of the SOQs seeks to fulfill a constitutional duty and aspires to ensure that education standards across Virginia align with the priorities of VBOE. However, given the fiscal impact of the prescribed SOQs and the existing Standards outlined in Code, the practical implications of VBOE’s actions remain unclear.

The final set of proposals contain significant changes that include increased local flexibility, but still could impose significant fiscal impacts both to state and local governments if enacted. In addition to the new requirements, VBOE specifically requested that the General Assembly remove the recession era cap on state aid to support positions. Removal of the “support cap” would yield $371.6 million in additional state funding to localities to help pay for positions currently funded entirely by local effort.

Funding of SOQ requirements is met by a combination of state and local resources. Local ability to pay for standards with required local effort (RLE) is determined by the composite index formula (LCI), which is updated every two years to account for the latest available state and local values in real property, adjusted gross income, retail sales, average daily membership of students, and total population. The Department of Education (VDOE) recently released the LCIs and trend analysis to be used in the coming biennium, which can be found here. The LCI data will be used to calculate the state share of K-12 funding, which will be provided in December following the release of the Governor’s 2020-2022 introduced budget.

Lastly, VDOE staff gave a presentation to the Senate Finance Committee on the latest estimates for the Rebenchmarking of the Direct Aid to Public Education Budget for the 2020-2022 Biennium. The rebenchmarked budget represents the state cost of continuing the current Direct Aid programs into the next biennium, with updates to the input data used in the funding formulas that determine the cost of the programs. This technical process occurs every two years and incorporates the latest data to reflect changes in enrollment, salaries, support costs, inflation, and other factors. This process impacts localities as it helps determine RLE. The initial estimated state cost of rebenchmarking for the upcoming biennium is stated to be $595.7 million. This represents a growth of nearly $100 million from the last biennium.

Full meeting materials and minutes of VBOE and the VBOE Committee on the Standards of Quality can be found here and here respectively.

VACo Contact: Jeremy R. Bennett

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