‘True Cost’ of education study resolution aces tests in committee

February 23, 2021

SJ 294 (Lewis) would require the Joint Legislative Audit and Review Commission (JLARC) to study the true cost of education in the Commonwealth and provide an accurate assessment of the costs to implement the Standards of Quality (SOQs). As VACo has previously reported, the SOQs prescribed by the Virginia Board of Education (VBOE) and enacted and funded by the General Assembly set minimum requirements that must be met by all local school divisions for K-12 education in Virginia. 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.

Even though the SOQs set the minimum standards for K-12 education in Virginia, they do not reflect the actual prevailing costs of maintaining a high standard K-12 education system. No locality in Virginia funds its share of K-12 responsibilities at the minimum standards as prescribed by the state. In FY 2018, 92% of school divisions exceeded RLE by more than 25%. A quarter of all school divisions exceeded the RLE by 75% to 100%. On average this equates to $4 billion spent by localities beyond state requirements, making Virginia localities one of the top ten supporters of K-12 education by proportion of local funding in the nation according to the latest census data.

In conducting its study, the JLARC shall (i) estimate the cost of implementing the Standards of Quality based on the actual expense of education prevailing in the Commonwealth;, (ii) determine if the Standards of Quality accurately reflect actual standards of practice within each school division;, (iii) analyze changes in the Standards of Quality funding formula since 2009 and the impact of such changes on its accuracy in reflecting such costs;, (iv) recommend changes to the Standards of Quality funding formula to ensure that state support is neither inadequate nor excessive;, and (v) consider any other funding issues and make any other recommendations it deems relevant.

JLARC would be required to conduct a two-year study of this subject submit an executive summary of its findings and recommendations no later than the first day of the General Assembly session in 2023 and 2024. The resolution was reported from the House Rules Committee unanimously, 18-0.

VACo Contact: Jeremy R. Bennett

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