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financial audit. School districts are likely to incorporate Horace Mann schools into the
school district reporting and auditing process, although other arrangements are possible.
Responsibility for Debt and Ownership of Assets: Resides with school district. Appendix 149 Venturesome Capital: State Charter School Finance Systems Michigan
Base Funding: School district funding is driven by the “foundation allowance,” a per-pupil guaranteed funding level determined uniquely for each school district. The proceeds of an
18 mill local property tax levy are subtracted from the guaranteed funding level and the
balance of school district funding comes from state revenue. The 1998-99 foundation
allowance for most school districts is based on the 1993-94 (the year before a major state
school finance overhaul) foundation allowance as updated on an annual basis. The
legislature allowed the foundation allowance of several low-spending school districts to
increase at a faster rate in order to reduce spending disparities among school districts. High
tax effort and high wealth school districts, usually located in suburban areas, had the
highest foundation allowances in 1998-99, as was the case in 1993-94.
Charter schools, which can only operate as a single-site facility, receive the per-pupil
foundation allowance of the school district in which they are physically located, not to
exceed $5,962 in 1998-99 (coincidentally, this figure is about the same as the state
average). Approximately 100 of the state’s 140 charter schools receive the maximum
amount. Two charter schools receive the minimum allowance of $5,170, the same as the
school districts in which they are located. Unless chartered by a school district, charter
schools can enroll students outside the boundaries of the school district in which the
charter school is physically located.
Funding Based on School District Characteristics: Variations in school spending have narrowed since 1993-94. Low-spending districts are allowed to increase their funding at a
rate faster than the average, so charter schools in low-spending school districts also show
more rapid revenue growth. Charter school funding is based on the geographic location of
the school building, creating an incentive to locate charter schools in school districts that
spend at least $5,962, the state maximum charter school payment. Not surprisingly, 70
percent of charter schools get maximum funding.
Special Education: Charter schools are eligible for special education categorical funding on the same basis as school districts. Some special education costs in school districts come
from foundation allowance funds. About $150 per enrolled pupil (not per handicapped
student) is available through state categorical aid (a two-year funding lag exists) as well as 150 Appendix Michigan $50 per enrolled pupil through federal funding. The state also provides about $350 per
pupil (averaged across all pupils in the state) directly to intermediate service districts. ISDs
are also allowed to levy a property tax. Overall, state support for special education
averages about 8...
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- Spring '09