Initial Proposed Changes to How Schools Are Funded in DPS 1

Initial Proposals for Discussion We are presenting initial proposals for discussion. We look forward to input and feedback in anticipation of our meeting on January 24. Our proposals, with very few exceptions, do not suggest reducing the current funding that any school receives We are proposing to increase full-day kindergarten and total early childhood education slots by at least 25% each this year, with more to follow next year. This expansion is not dependent on additional money from the proposed pension finance transaction. Our other proposals are to use the additional money we expect to receive from the pension financing to increase funds to those schools that are currently receiving fewer per pupil dollars as a result of historical funding formulas With additional pension funding, we propose increases in per pupil funding for – Secondary schools – Students in poverty – Special education/intervention strategies – Specialized services such as counselors and mental health professionals – Gifted and talented students Initial Proposed School Funding Changes

DPS pays almost $800 more per student than other Colorado school districts for pension and retirement Other Colo. Districts DPS *Based on numbers for Includes retiree health benefits 3 This amounts to $50 million higher pension and retirement costs per year than other districts All other districts in the state have been a part of PERA since 1943, the year districts were allowed to join Dollars per Student per Year Paid Toward Pension and Retiree Obligations

The $50M extra spent on pension severely limits DPS’s ability to lower class sizes, pay competitive salaries, and meet the pressing educational needs of our students * Students in poverty means Free or Reduced Lunch; ELL means English Language Learners ** All data is from Colo. Dept of Ed. FRL data is from School year. ELL and Special Ed data is from school year 4 A much greater fraction of DPS’s student population is in poverty, learning English and has special needs than other districts (see chart at right) DPS pension costs consume nearly 20% of the district’s general operating fund The district has had to cut nearly $83 million from its budget in the last 5 years

How Schools Currently Get Funded in DPS Critical Points The Student Based Budgeting (SBB) funds exclude many of our school- specific expenses, like: – speech language itinerants – services for severe needs students – certain pension/retirement expenses – key instructional support services – school-based support services, like custodial, food services, grounds, transportation It is very misleading, therefore, to think of the SBB funds as the only money that goes to individual schools. 5

Virtually All Schools Will Benefit From Proposed Changes Key point to note is that, with very few exceptions, we will not be taking money away from existing schools – we will be adding new dollars from the pension transaction first to those schools that have received less per pupil money in the past While we will be targeting a significant portion of new dollars from the pension transaction towards high-poverty students, all our students and schools will benefit from the increased funds All kids will benefit from the increase in full-day kindergarten and ECE funds All secondary school students will benefit from the increase in middle school and high school base funding All schools will benefit from the increase in gifted and talented funding All schools will benefit from the increase in specialized services and intervention services for mild/moderate students

Additional $4-5 million for full-day kindergarten Would increase full-day kindergarten offerings by 25%, so as many as 1,200 more kindergarten students will be able to attend full-day Money would come from 2003 Mill Levy and include some General Fund money Additional money from the state is vital to achieving the goal of full-day kindergarten $7 million $11-12 million SBB Allocations for Full- Day Kindergarten 7 Initial Proposed School Funding Changes

25-40% increase in preschool capacity Up to $5 million more for ECE; depending on facility availability Would increase preschool offerings by between 25 and 40% in , allowing up to 1,400 preschool students to get more services this year, and by another 25% in , for a total of nearly 3,000 Money would come from the Denver Preschool Program Nearly all of the 80 elementary and K-8 schools would expand kindergarten and or preschool offerings $16 million Up to $21 million SBB Allocations for Preschool 8 Initial Proposed School Funding Changes

$2.4 million more to raise per pupil base funding for secondary schools to same level as elementary schools Total additional spent in schools: $2.4 million from pension refinancing Expected to help 21,000 students Additional money dependent on pension financing transaction 9 Initial Proposed School Funding Changes

$6.3 million more for low-income students Each school would receive $268 for every free lunch student grades 1-12 Further, the schools with the highest concentration of poverty would receive an extra $134 per free lunch student Increase of $6.3 million for low-income students funded from pension money Additional funds dependent on pension finance transaction Elementary, K-8, Middle6-12, High SBB Allocation to Schools 10 Initial Proposed School Funding Changes $268 $402

$ 3 million more money for mild/moderate interventions and for special services Schools with a higher proportion of free and reduced lunch students would receive greater share of funding increase Additional funds depend on pension financing transaction Proposed SBB Allocations for Mild/Moderate $8.4 million $1.3 million $17.7 million $1.5 million Proposed SBB Allocations for Special Services 11 Initial Proposed School Funding Changes

Move to Per student funding for mild/moderate and special services Proposal would hold harmless schools that are currently above these per pupil levels Low-income (Free or Reduced Lunch) students would receive 50% more funding for each category: $351 for Mild/Moderate and $167 for Special Services 12 Initial Proposed School Funding Changes

Together, proposed budget changes target greater funding to low-income students State funding for “at-risk” students flows only to those qualifying for free lunch in grades 1-12 Note that under the current system secondary schools (middle, 6-12 and high) receive only $70 per “at-risk” student Goal is that about 20 schools across the district would qualify for high-poverty status $1,320 Maximum Targeted SBB Funding Per Low-Income Student High-Poverty School Mild Moderate Specialized Services At-Risk Title I 13 Initial Proposed School Funding Changes

35% more money for gifted students $1.6 million $2.2 million Funding for Gifted and Talented would increase by $95 per student Additional funding dependent on pension finance transaction High schools do not qualify for GT funding SBB Allocations 14 Initial Proposed School Funding Changes

Other Proposed Changes Small school additional subsidy would be reduced by 25% next year and 25% following year – Small schools already receive extra funding in several of the categories, like Gifted and Talented and 2003 Mill Levy Arts allocations – No reductions proposed for targeted small school subsidies; reductions in only the small school additional subsidy SBB to RAM (School based budgeting to Resource Allocation Method) would be eliminated – Board intention during last year’s budget discussion was that SBB to RAM would be eliminated this year – Under current proposed changes, funding more than made up for in other categories Title I: schools with over 66% of the students qualifying for Free or Reduced Lunch would qualify for Title I money 15 Initial Proposed School Funding Changes

No further changes With the exception of the subjects on the previous pages, we are not recommending further changes in the budget this year No changes are recommended to funding for areas such as IB or Montessori programs Where schools receive additional funding for these programs, this funding will be taken into account when calculating new dollars these schools would otherwise receive and effectively offset against these new dollars