Public education funding had two big wins Friday, May 30.
The Joint Ways and Means Committee approved an $11.36 billion State School Fund, a fair approximation of the state’s current service level needs at a time when legislators are warily eyeing economic forecasts.
Perhaps even more importantly, the committee approved House Bill 2140, which ensures future current service level calculations will more closely match schools’ actual costs.
We are at the point in the legislative session where the budget work is picking up speed. The Legislature has just one month left to move bills through the Ways and Means process and vote them off the Senate and House floors. Ways and Means had 26 bills on its docket to approve Friday morning.
The 2025-27 State School Fund budget, Senate Bill 5516, represents a roughly 11.4% increase over last biennium. This is not only a larger current service level roll-up than any other program area is likely to see this session, but it also represents a shift in how we have been able to approach our work in the Capitol.
During the interim, stakeholders worked with Gov. Tina Kotek’s office to update the methodology for calculating current service level costs for school districts. This came about after years of state budget writers and education advocates disagreeing about the true cost of running our schools.
Often, those disagreements would take the majority of our time and attention during the session, requiring countless meetings explaining to legislators the areas where our calculations differed and the rationale behind the math. Always we hoped that those efforts would result in a State School Fund that came in a couple of hundred million higher than the governor’s recommended budget.
This year, the updated CSL methodology had us starting at $11.36 billion in the governor’s budget, nearly $600 million higher than it would have been under the previous methodology.
For the first time in many school board members’ memory, we did no fighting over the CSL. That allowed us to spend time advocating for targeted investments in crucial areas such as special education. Unfortunately, following the latest Oregon Economic and Revenue Forecast, significant additional investments seem unlikely, but we have clearly made the case. Legislators are primed to make those investments as soon as the financial outlook allows.
We recognize that many districts are still facing cuts in their budgets because of contract negotiations, enrollment changes and the end of federal pandemic recovery funds. The state CSL can’t account for every district’s unique circumstances, with some facing wider fluctuations than others. The state CSL is a best-guess estimate of what it would take for most districts to remain whole at a point in time.
As our friends at the Oregon Association of School Business Officials tell me regularly, the estimating nature of the budgeting process means that “the day after you approve your budget, it’s already wrong.”
The state budget has been more than a year in the making, and some factors have definitely changed. It represents a prediction that is already in the rearview when the Legislature approves the budget.
Given the bureaucratic process necessary for building an entire state budget, it’s not realistic to use real-time numbers. As a result, there will always be districts for which the State School Fund CSL calculation is more accurate than for others.
But the improved process used this year and codified in HB 2140 resulted in schools getting twice as much roll-up funding as they would have under the previous model, and that’s a huge win. HB 2140 ensured that our budget predictions – although never perfect – will continue to more closely track the reality faced by schools.
With a state budget as tight as it’s been since the Great Recession, it’s really rather extraordinary that we have the State School Fund budget we do. It’s the result of years of hard work by stakeholders and incredible advocacy by educators, parents and school board members in the field.
The governor and the Legislature clearly put students first this session.
– Stacy Michaelson
OSBA Government Relations and Communications director
