New Education Funding Formula Released

February 25, 2022

On Thursday, Governor Bill Lee and Commissioner of Education Penny Schwinn unveiled the new Tennessee public education funding formula for K-12 students. The existing formula, known as the Basic Education Program (BEP), was adopted by the state legislature about three decades ago in response to litigation brought by small rural school systems that showed their systems didn’t have access to the same resources as wealthier districts. 

Now, 30 years later, Governor Lee announced late last year his intention to replace this formula. The Dept. of Education quickly named multiple committees of parents, teachers, business leaders and other stakeholders and held meetings throughout the fall to come up with concepts for a new funding formula. From the beginning, the administration has described what they wanted to develop as a “student-based” funding formula. The result of this effort is a bill known as the Tennessee Investment in Student Achievement (TISA) Act which was revealed this week.
Central to this concept is an effort to attribute a specific dollar amount of funding to be allocated to each one of the nearly one million children in Tennessee’s K-12 public schools and charter schools. Each child will receive a base allocation, with weighted factors that provide additional funding to the student.
This framework is made up of several levels:

• Base Funding - A base amount of $6,860 per student regardless of grade level
• Weights - additional percentage enhancements for students with unique learning needs, such as being in a sparsely populated community, having learning disabilities, or being in an economically disadvantaged community. Additional funding is also provided to students attending a charter school. 
• Direct Funding - specific amounts for students in specific programs or courses, such as K-3 literacy programs or high-value CTE courses
• Outcomes-Based Funding - per-student awards made to schools or school systems for positive measurable outcomes

The emphasis of the TISA is on per-student funding, and to be clear, these funds go to school districts to spend based on the students’ unique needs within the district. The money is intended to follow the child in the event they move to a new school system or choose to enroll in a charter school. While the administration claims this proposal is unrelated to controversial private school voucher legislation, it would create a structure that simplifies making individualized determinations of how much funding a parent would be entitled to if, in the future, a voucher program is implemented and they withdrew their student from public school. 
Currently, the legislation Lee championed in 2019 to create vouchers in Davidson and Shelby County is in court. The trial court held the law unconstitutional and the appeal is pending before the State Supreme Court. Arguments in the case were reheard this week. A decision had been pending before the court when Justice Connie Clark passed away last fall.  
The language of the amendment that would enact the TISA funding formula was just released publicly on Thursday. With legislators openly talking about a desire to adjourn the legislative session before the end of April, this essentially gives the General Assembly less than two months to fully digest the 34-page bill and analyze how it will impact school districts across the state. If adopted, the bill is intended to take effect during the FY23-24 budget. 
You may view the full press release announcing the new formula from the Department of Education here.