The State’s current school finance system includes both the Kansas School Equity and Enhancement Act (KSEEA) and other school finance laws that cover six 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.
Kansas School Equity and Enhancement Act
KSEEA consists of two major areas of focus: State Foundation Aid and Supplemental State Aid. The 2017 Legislature enacted the KSEEA to replace the Classroom Learning Assuring Student Success Act (CLASS) Act. It will expire on July 1, 2027.
The KSEEA was enacted as part of the Legislature’s response to the Gannon v. State court cases, which started in 2010. The Kansas Supreme Court released jurisdiction of the Gannon case in February 2024.
An Education Funding Task Force was established during the 2025 Legislative Session to review the current school finance system and provide recommendations regarding the school finance formula after the expiration of KSEEA, Special Education State Aid, and any other recommendations related to school finance on or before January 11, 2027.
The Education Funding Task Force has already met several times during 2025 and will continue to meet through 2026.
State Foundation Aid
State Foundation Aid is the primary focus within the funding formula and provides the majority of state funding for the daily operation of schools. State Foundation Aid is a student-based funding model, where school districts receive a base amount of funding per student, with additional funding added to provide additional services and support to students with unique needs. In Kansas, State Foundation Aid 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.
For SY 2025-2026, BASE is $5,615 per student.
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 students;
- High-density at-risk students;
- Bilingual students;
- Low enrollment;
- High enrollment;
- New school facilities;
- Ancillary school facilities;
- Cost-of-living;
- Career technical education;
- Special education; and
- Transportation.
The resulting weighted FTE enrollment is then multiplied by the BASE aid amount to calculate a school district’s (district) Total Foundation Aid entitlement.
While special education is listed as a weighting, the weighted FTE is backed into from the Special Education State Aid amount for each school district. This weighted FTE is not included in State Foundation Aid calculations for a school district, but is used to calculate Total Foundation Aid for the purposes of local option budget calculations.
Supplemental State Aid
Local school boards (boards) may adopt a local option budget (LOB) in addition to the annual State Foundation Aid a district receives from the State. LOB revenues are generated from local property taxes and Supplemental State Aid.
Because property valuations vary widely between school districts in Kansas, Supplemental State Aid is provided by the State as a form of equalization aid. The lower a school district’s property values per student are, the more Supplemental State Aid it receives for its LOB. After the amount is determined, districts are then responsible for funding the rest of the LOB with local property taxes. Equalization, therefore, effectively serves as property tax relief for school districts with smaller tax bases.
Capital Outlay State Aid
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
Districts may also 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 rate categories, which are:
- 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 (AVPP), which is calculated yearly.
A district’s state aid may be calculated using multiple rates depending on when the bonds were approved by voters.
Special Education State Aid
Calculation
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.
Distribution
During the 2024 Legislative Session, the Legislature amended law governing the distribution of state aid for special education to require the Legislature to appropriate at least $601.0 million for special education for FY 2025 and every year thereafter. It also requires $528.0 million to be distributed based upon the existing statewide distribution system. This distribution includes four areas:
- Medicaid Replacement State Aid;
- Catastrophic Aid;
- Transportation Aid; and
- Special Education Teacher Aid.
The Special Education State Aid funding that is in excess of $528.0 million has its own distribution formula, which is established by the State Board of Education. Currently, funding is distributed proportionally based on each school district’s local effort towards special education expenses.
KPERS Employer Contributions
The State pays the employer contributions to the Kansas Public Employees Retirement System (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 (United School Districts) 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.
By Jennifer Light and Matthew Willis.
See Education for more.