RICHMOND — A week after Virginia’s public education governing board said it would cost nearly $1 billion more per year to give students the education they need, lawmakers are now looking at a bill of about $300 million on top of that.
Technical changes to the state’s education budget total $595.7 million over the next two years, the Senate Finance Committee learned Tuesday.
That cost doesn’t include the $950 million in funding — a roughly 18% increase to the $5.36 billion spent by the state on public education in 2017-18 — the Virginia Board of Education is recommending lawmakers spend to hire more reading specialists, have smaller class sizes and give more money specifically to schools serving students from low-income families, among other things.
Every other year, the state is required to “rebenchmark” its budget, which entails updating the number of students enrolled in state schools, the cost of inflation and the percentage of students qualifying for free meals, among other things.
The changes aren’t recommendations to alter funding policy or pay for new programs, said Kent Dickey, the Virginia Department of Education’s deputy superintendent of budget, finance and operations, in his presentation to the committee.
Take an update to the number of English Learner students, for example. Virginia has seen a drastic climb in the number of students learning English over the past 10 years, rising from 64,261 in 2009-10 to 107,757 last school year.
With that growth expected to continue, state officials say Virginia will need $7.4 million more over the next two years — the 2020-2022 biennium — to pay for remedial summer school and the English as a Second Language programs.
The nearly $600 million rebenchmarking cost is split over two years — $289.6 million in 2020-21 and $306.1 million in 2021-22. The Finance Committee did not discuss Tuesday the board’s proposals or if it will fund them.
“Our schools are educating more students, and more of them come speaking a language other than English, more are living in poverty, more have suffered some form of trauma growing up,” said Virginia Education Association President Jim Livingston last week after the board of education’s vote. “We should be adding services to help these children become healthy, educated adults — we shouldn’t be cutting their lifeline.”
State spending per student is currently down about 8% compared with before the Great Recession, according to the Commonwealth Institute for Fiscal Analysis, a Richmond-based research organization. An average of $5,749 is spent on every student, compared with $6,225 in the 2008-09 school year, after adjusting for inflation.
The updated funding requirements for K-12 will be one of the top drivers for spending in the two-year budget that Gov. Ralph Northam will propose on Dec. 17 for action by the General Assembly in the 60-day legislative session that will begin Jan. 8. The other big mandatory spending requirements are the new forecast for Medicaid and pension contribution rates for state employees and teachers.
The new Medicaid forecast hasn’t been released, but the Virginia Retirement System said Tuesday that the lower assumed long-term return on investments that it adopted this month will cost the state general fund about $90.4 million in each year of the budget. That’s almost $4 million less each year than the VRS had estimated earlier. Local school systems also will have to pay an additional $108 million each year in contributions toward teacher retirement liabilities.
The VRS lowered its assumed rate of return for the $82.3 billion retirement trust fund from 7% to 6.75%. It was the first adjustment in the return assumption since 2010 and reflects a more conservative approach to stock market investments after a long economic recovery since the last recession.