Delaware Advances Historic School Funding Update as Hybrid Model Moves Forward

• What Is the Hybrid Funding Model? 
• What Could This Look Like in Schools?
• Legislative Update: SB 302 and SB 303
• Timeline and Next Steps
• Reassessment Updates
• Fact or Fiction?

Delaware is continuing its work to modernize how public schools are funded, an effort years in the making and one that could reshape how resources reach students across the state. Following extensive analysis and public engagement, the Public Education Funding Commission (PEFC) has advanced a proposed hybrid funding model that preserves key strengths of Delaware’s existing system while creating more flexibility to direct funding toward student needs. Legislation now moving through the General Assembly would begin laying the groundwork for implementation, while future phases of work are expected to address local funding reform and equalization, accountability, and additional targeted supports. 

Alongside these conversations, ongoing discussions around property reassessment have brought renewed attention to how local funding and taxpayer impacts intersect with public education. 

Reminder: What Is the Hybrid Funding Model?

The Public Education Funding Commission (PEFC) has proposed a hybrid funding model that would include components from the original unit model, while also incorporating elements of more weighted student funding models.  

Key components of the new funding model:  

• Increased Funding Targeted to Student Needs 
  • The new model will consolidate over 30 different funding streams into three larger buckets: Base, Opportunity, and Operational funding.
  • The Opportunity and Operational funding streams are per-pupil based, allowing those dollars to directly target student need. 
  • This formula also allows for additional flexibility, so schools and districts can direct funding to the highest need student groups. 

• Streamlined Requirements and Greater Flexibility
  • The new formula will reduce the required number of position types from 32 to 18, allowing school and district leaders to be more flexible about which staff positions are needed and reduces administrative burden to fulfill staffing requirements  
  • Several grant items will be consolidated, allowing for more flexibility and streamlining reporting requirements for schools and districts. 

• Educator Salary Protections 
  • The new formula will maintain Delaware’s statewide educator salary scale and protect educator compensation structures. 

• Regular Review and Accountability 
  • The new formula and proposed bills establish a recurring review cycle for the funding formula, which will prevent long periods without updates or modernization. 

• Increased Community Engagement 
  • Greater flexibility will create more opportunities for community and family input on district and school-level spending decisions. 

 

Explore informational resources from PEFC: 

• PEFC Communication One-Pager 
• Public Engagement Presentation (English) (en español) (an kreyòl ayisyen) 
• Recorded Public Engagement Presentation 
• Frequently Asked Questions (FAQs) (English) (en español) (an kreyòl ayisyen) 

 

What Comes Next? Legislative Update: SB 302 and SB 303

There are currently two bills directly related to the PEFC and the new hybrid school funding formula in the General Assembly.  

Senate Bill 302 focuses on the beginning of implementation for the first phase of the PEFC’s recommendations. In order to make the transition to a new formula smooth, there will need to be updates to computer systems, financial management systems, and new district and school trainings will need to be designed. Additionally, this bill will codify the hybrid formula structure by establishing the three funding buckets: base funding, opportunity funding, and operational funding. 

Senate Bill 303 formally codifies the PEFC and requires the PEFC to continue meeting at least twice annually moving forward to review and potentially propose updates to the funding formula. This bill also directs the PEFC to address the following topics in their future work:  

• Equalization and local funding reform 
• Referendum and operational funding reform 
• Continued formula review and refinement 
• Accountability and reporting systems 

 

Timeline and Next Steps

Both bills have currently passed the Senate, they will move to the House for consideration. If passed, the updates at Delaware’s Department of Education will take place over the next year, to prepare for the second phase of recommendations anticipated next legislative session.  

There is still work to be done, and the PEFC has indicated that they will be addressing the following topics in the next phase of recommendations:  

• Equalization  
  • The equalization formula has been a pain point for districts for many years since it has been frozen since 2009. This formula is intended to address funding disparities between wealthier and lower-income districts by providing additional dollars to those districts that do not have the same local wealth capacity.  
• Additional Targeted Funding  
  • Funding to support multilingual learner (MLL) students has become a topic of interest for many advocates, as experts have shared the need for tiered MLL funding to address the different needs within this population. A newcomer in high school will require more supports than a kindergartner who has been in public schools for a few years.  
  • The ACLU has also submitted a letter to state officials indicating a potential lawsuit if the needs of MLL students are not met.  
  • Support specifically for schools in poor neighborhoods have also been discussed. In addition to funding weights for students from low-income backgrounds, support would be given to schools with high concentrations of students from low-income backgrounds to help meet those needs.  
• Accountability Systems  
  • PEFC is required to develop and propose reporting and accountability mechanisms tied to equitable student outcomes to ensure that funding is going where it is intended and that it is being used in the most effective ways.  

 

Other Topics: Reassessment Reform

Over the summer last year, several special sessions were held in regard to property reassessment. Many Delaware residents were shocked by the increases in their property tax bills, and the topic of local school funding and reassessment reform came front and center. However, local property taxes play a large role in public school funding, so reforms are needed to make sure that schools receive the funding they need while also being fair to taxpayers.  

A proposed reassessment reform bill, SB 322, would remove the current rule allowing districts to increase property tax revenue by up to 10 percent after reassessment and replace it with a formula tied to prior operating revenue and actual growth in taxable property values. 

This formula would allow districts to increase total revenue from property taxes by up to two percent annually without another referendum under certain financial conditions.  It would also maintain taxpayer protections since any increases above the two percent would still require referendum and voter approval. Additionally, the new two percent authority would not apply to vocational-technical school districts whose limit is set by the General Assembly and can be increased to that limit without voter approval. 

Related Topics: air report, delaware property tax, delaware school funding, federal education funding, pefc, public education funding commission, student success, vision coalition