Brief: Kansas School Finance System Overview

The State’s current school finance system includes both the Kansas School Equity and Enhancement Act (KSEEA) and other school finance laws covering the following areas of focus:

• State Foundation Aid,
• Supplemental State Aid,
• Capital Outlay State Aid,
• Capital Improvement State Aid,
• Special Education State Aid, and
• Kansas Public Employees Retirement System (KPERS) employer contributions.

Each area contains its own unique funding formula or formulas. An in-depth memorandum on KSEEA and its formulas for each area, titled “Kansas School Finance System,” can be found on the Education page.

State Foundation Aid included in KSEEA

State Foundation Aid (SFA) is the primary focus within the funding formula and provides the majority of state funding for the daily operation of schools. SFA calculations are based on two factors: the base aid for student excellence (BASE), and the weighted full-time equivalent (FTE) student enrollment of each school district.

BASE

BASE funding is set by statute and, as of school year (SY) 2023-2024, the BASE is the prior year’s amount adjusted by the average percentage increase in the Consumer Price Index for the Midwest region during the three immediately preceding school years.

Weightings

Weightings are added to each school district’s regular FTE enrollment in order to reflect additional costs associated with serving certain student populations and to address other district characteristics. There are currently 11 weightings: At-risk, High-density At-risk, Bilingual, Low Enrollment, High Enrollment, Transportation, Career Technical Education, Special Education, New School Facilities, Ancillary School Facilities, and Cost-of-living. The resulting weighted FTE enrollment is then multiplied by the BASE aid amount to calculate a school district’s Total Foundation Aid entitlement. Statute requires certain existing revenues, such as ending balances, to be subtracted from the Total Foundation Aid during calculations of state aid.

Supplemental State Aid included in KSEEA

Local school boards may adopt a local option budget (LOB) in addition to the annual State Foundation Aid a school district receives from the State. LOB revenues are generated from local property taxes.

Supplemental State Aid is provided by the State as a form of equalization aid. The lower a school district’s property values per student, the more Supplemental State Aid it receives for its LOB. After the amount is determined, school districts are then responsible for funding the rest of the LOB with local property taxes.

Capital Outlay State Aid

School districts may levy a local property tax of no more than eight mills for the purpose of funding capital outlay expenditures. These funds may be used for the “acquisition, construction, reconstruction, repair, remodeling, additions to, furnishing, maintaining, and equipping of school district property and equipment necessary for school district purposes.” Additionally, some school districts are eligible to receive Capital Outlay State Aid in a manner similar to Supplemental State Aid. However, unlike Supplemental State Aid, Capital Outlay State Aid does not replace local property taxes, but instead supplements local property taxes.

Capital Improvement State Aid

School districts are also allowed to issue bonds to finance construction of school facilities and receive Capital Improvement State Aid, if eligible, to help pay costs associated with these bonds as a form of equalization aid. Rates for these bonds are broken down into four different categories:

Bonds approved by voters prior to July 1, 2015;
Bonds approved by voters on or after July 1, 2015, but prior to July 1, 2017;
Bonds approved by voters on or after July 1, 2017, but prior to July 1, 2022; and
Bonds approved by voters on or after July 1, 2022.

Each of these rates have different calculations for state aid, although all four rates are based on school districts’ assessed valuation per pupil, which is calculated yearly.
A school district’s state aid may be calculated using multiple rates depending on when the bonds were approved by voters.

Special Education State Aid

Special Education State Aid is calculated as reimbursement for the “excess costs” associated with providing special education services. The State Department of Education determines the excess cost both statewide and, starting in SY 2024-2025, for each individual school district before distributing Special Education State Aid.

Statute requires a reimbursement rate for Special Education State Aid at 92.0 percent of total state excess costs, but provides for prorating state aid if the appropriation for Special Education State Aid does not equal 92.0 percent of excess costs.

KPERS Employer Contributions

The State pays the employer contributions to KPERS for all KPERS-eligible school employees in Kansas. This part of the retirement system is known as KPERS–School and is composed of two parts: KPERS–USDs and KPERS–Non-USDs. The obligation for employer contributions follows the schedule of contribution rates included in statute. KPERS–USDs is for public school employees, and KPERS–Non-USDs is for employees of community colleges, technical colleges, and school district interlocals.