Chapter 3.4


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3.4 - How do Mandated Costs Impact School District Local Revenues?

While pension costs, special education costs and charter school tuition costs are generally responsible for driving annual increases in school district budgets, school districts have limited to no control when it comes to these three areas. When costs increase in any or in all of these three areas, a school district must either find the revenue to cover it or make cuts or reductions to other areas and programs. This is an ongoing challenge for school districts, as the annual increases in these three areas alone are significant.

As illustrated in the maps on Data Dive 3.3, many school districts had substantial negative change in operating expenditures less mandated costs (net operating expenditures), suggesting these school districts made program adjustments and reductions to help cover increasing mandated costs. To better understand the fiscal impact on local revenue and programs from changes (2013-14 to 2018-19) in mandated expenditures, we applied the changes in the supporting state subsidies (2013-14 to 2018-19) distributed from the state to school districts that support districts' effort to cover these costs. The change in mandated costs less change in supporting state subsidies results in the "local share of mandated costs", or the portion of mandated costs for which districts had to cover through local revenues and/or adjustments or cuts to other programs/areas. Supporting state subsidies affecting the local share of mandated costs include the change in basic education funding, special education funding, pension reimbursement payments, and charter school tuition reimbursement payments.

Click on the image link below to view our interactive infogram illustrating change in total mandated costs and change in supporting state revenues to school districts from 2013-14 to 2018-19. The difference between the two columns represents the local share of mandated that resulted in substantial cuts and reductions to programs and increases in local revenues.

 

Click on the image link below to view our map showing six-year $ change in the four supporting state subsidies as well as the supporting state subsidies’ average annual % change in relation to school district total operating expenditures.

Click on the image link below to view our map showing local share of mandated costs ($ change in mandated costs less $ change in supporting state subsidies) as well as the local share of change in mandated costs as a % of change in total mandated costs.