Bills would address poverty factors in school aid formula

Members of the Education Committee heard testimony Feb. 9 on two bills that seek to address the needs of students in poverty.

Currently, school districts that spend less than 50 percent of their poverty allowance in a given year are disqualified from receiving the allowance in the ensuing year under the Tax Equity and Educational Opportunities Support Act (TEEOSA). LB509, introduced by Omaha Sen. Tanya Cook, would eliminate this penalty.

As the number of students in poverty continues to increase, Cook said, senators need to conduct a thoughtful reanalysis of existing policy to avoid penalizing school districts for implementing innovative and more cost-effective poverty measures.

“This idea is to open a discussion about how we can amend the operation of the poverty allowance in our state’s education funding system,” she said. “Because of current penalty provisions, some schools—large or small—are penalized for innovation and investment in their learners.”

The bill also would decrease the amount that a district must spend on poverty expenditures in order to avoid having a poverty allowance correction. Currently poverty expenditures must equal 117.65 percent of the poverty allowance. LB509 would decrease this requirement to 105.26 percent of the poverty allowance.

Representing the Greater Nebraska Schools Association, Virgil Harden spoke in favor of the bill. He said that available resources for vulnerable students often go unused because of current penalty provisions.

“Poverty has a profound impact on a student’s ability to learn,” he said. “This bill would ensure that resources are available to address the unique needs of students in poverty.”

LB509 also would decrease the penalty assessed to a district for not meeting the required elements of a poverty plan. Under the bill, the penalty would decrease from a 50 percent poverty allowance correction to a 5 percent correction.

Based upon preliminary certification, it is estimated that LB509 would result in a $148,000 decrease in state aid for fiscal year 2015-16.

Committee members also heard testimony on LB524, introduced by Cedar Rapids Sen. Kate Sullivan. The bill would redefine low-income and poverty students under TEEOSA to include students who are provided free meals under the Community Eligibility Provision (CEP).

The CEP is an option for school districts to offer free meals to all students in high poverty schools without collecting applications from households. To qualify, a school must have at least 40 percent of its students identified as poverty students.

Sullivan said that the TEEOSA formula currently uses the number of students receiving free or reduced meals in calculating funding. The changes proposed in LB524 would help encourage school participation in the CEP while also addressing challenges to the calculation of state aid under TEEOSA.

“There is low usage of the CEP program among school districts currently,” she said. “In the meantime we can’t just sit and do nothing. We need to make [CEP] work for us and make sure that it doesn’t present difficulties in administering our current state programs.”

Representing Nebraska Appleseed, Mary Ann Harvey testified in support of the bill, saying that Nebraska currently is ranked 49th in adoption of the CEP.

“We believe [CEP] is an exciting opportunity for some school districts,” Harvey said. “It would help ensure that schools are feeding students who might otherwise go hungry, without the stigma that can come with free or reduced priced meals.”

No one testified in opposition to the bills and the committee took no immediate action on them.