Colorado Input-Based Financial Adequacy Study
Prepared for the Colorado Department of Education in 2024
Augenblick, Palaich and Associates (APA), in partnership with Picus Odden & Associates (POA) and Afton Partners (Afton) were selected by the Colorado Department of Education (CDE) to undertake an input-based adequacy study for the state. New Solutions K-12 and Tracie Rainey, a Colorado school finance expert, were also part of the study team.
The study team implemented the Professional Judgement and Evidence-based adequacy studies and a study of Colorado’s special education system to identify a baseline set of adequacy figures for the state. These figures were then adjusted based on additional surrounding data collected through (1) conducting a landscape analysis, (2) examining the impacts of wealth and income on resources, (3) studying differences in the cost of living and business across the state, and (4) administering a statewide community survey.
The study team recommends a traditional foundation formula with a base cost and adjustments for student and district characteristics. The recommendations are as follows:
The state should provide a base cost of $12,346 for all students in Colorado.
At-risk students should receive a weight of .35 to meet their academic and support needs.
ELL students should be funded through a multi-tiered system of weights related to their WIDA status including a .52 weight for WIDA levels 1&2, .36 for WIDA levels 3&4, and a .18 weight for WIDA levels 5&6.
A multi-tiered funding system should be implemented for special education students with mild disabilities funded with a weight of .44 and for moderate students with a weight of 1.1. The state would fully reimburse costs for serving severe students.
Small districts should continue receiving additional funding utilizing a formula similar to the one currently in place.
Colorado should create a state-specific cost adjustment that utilizes CWI and a cost of goods adjustment. If implemented, the state should consider capping the impact of a cost adjustment on total funding.
Districts should be funded based on the greater of a three-year average of current year student count or current year count.
The state should provide equalized matching funds for Mill Levy Overrides (MLOs) to eligible districts without a cap on available dollars. If a significant change in funding is provided to districts, the state should consider lowering the cap on the additional funds that districts can raise through MLOs.
The study team recommends a phase in of the HB24-1448 formula over the next six to ten years. Initial steps would include redesigning the formula to incorporate the relative weights described in the adequacy recommendation formula.