Funded: State Policy Analysis

A Detailed Look at Each State's Funding Policies

Below, see summaries of the state’s education funding policy in each issue area. Click the Expand icon next to any summary to see more detail, if available, about that state’s policy regarding that issue area. Click the Citation icon
next to any summary to see the sources of the information regarding that issue area.
Illinois
Funding Basics
Formula Type

Illinois has a primarily resource-based funding formula. It determines the cost of delivering education in a district based on the cost of the resources, such as staff salaries and course materials, required to do so. However, only a small proportion of state education funding is distributed through the formula. The bulk of state education aid is distributed based on historical allocation levels.

The state does not provide supplemental funding to cover the additional cost of educating other specific categories of students. However, Illinois considers specific grade levels, English-language learners, low-income students, and special education program expenses in the allocation of funding for staff costs. Services for students identified as gifted and students enrolled in career and technical education programs, along with some services for English-language learners, are funded through program-specific allocations.

Because all districts continue to receive funding from the state that is equal to or exceeds the amount they received prior to the state’s last funding reform, Illinois’ funding formula is constrained by the amount of additional money available. Because the state plans to move toward full formula funding over the span of a number of years, annual increases in funding are distributed to districts with the greatest need for state assistance. Districts are sorted into tiers according to the degree to which their local funding capacity can be expected to cover their local education costs, and a greater percentage of additional state aid is distributed to districts with lesser funding capacity.

References:
P.A. 100-0021, § 135-15, 100th Ill. Gen. Ass. (2017),
“Understanding Evidence‐Based Funding” (PowerPoint presentation, Illinois State Board of Education, 2017),
Base Amount

The state of Illinois uses a resource-based funding formula and therefore does not use a base per-student amount as the basis for its funding.

However, districts continue to receive funding from the state that equals or exceeds the amount they received prior to the state’s last major funding reform, which was calculated in part using a base amount.

References:
“Understanding Evidence‐Based Funding” (PowerPoint presentation, Illinois State Board of Education, 2017),
Local Revenue
Expected Local Share

Illinois expects school districts to contribute revenue to the funding of public schools. The amount each district is expected to raise for its education costs is based primarily on its property values, in accordance with a multi-step calculation.

A district’s expected local share (called the local funding capacity) is calculated through a multi-step formula that considers the ratio of a district’s assessed property wealth to its necessary funding amount; average property values in the state as a whole; and the district’s revenue from the state’s corporate personal property replacement tax. Once the state calculates the total amount of funding necessary to educate students within a district, it subtracts the expected local contribution and provides the difference in the form of state education aid.

Additionally, districts continue to receive funding from the state that equals or exceeds the amount they received prior to the state’s last major funding reform. This funding comes from the state. However, because it is guaranteed to all districts, it is counted along with each district’s local funding capacity. A ratio is calculated of the district’s local funding capacity to its local education costs, and this is the proportion expected to be covered out of local funds. The remainder of the district’s formula amount is meant to be funded by the state. Because the state plans to move toward full formula funding over the span of a number of years, annual increases in funding are distributed to districts with the greatest need for state assistance. Districts are sorted into tiers according to the degree to which their local funding capacity can be expected to cover their local education costs, and a greater percentage of available state aid is distributed to districts with lesser funding capacity.

References:
“Understanding Evidence‐Based Funding” (PowerPoint presentation, Illinois State Board of Education, 2017),
Property Tax Floors and Ceilings

Illinois sets ceilings for local property tax rates, and a level above which voter approval is required. Limits differ depending on the type of district and the type of tax.

For educational purposes, most elementary and secondary districts may levy tax rates of $9.20 for every $1,000 of assessed local property wealth without voter approval and $35.00 with voter approval, while K-12 districts may levy a tax rate of $18.40 for every $1,000 of assessed local property wealth without voter approval and $40.00 with voter approval. For operations and maintenance purposes, elementary and secondary districts may levy rates of $2.50 for every $1,000 of assessed local property wealth without voter approval and $5.50 with voter approval, while K-12 districts may levy a rate of $5.00 for every $1,000 of assessed local property wealth without voter approval and $7.50 with voter approval. School districts are also limited in the tax rates they may impose for specific purposes: for special education, elementary and secondary districts may levy rates of $0.20 for every $1,000 of assessed local property wealth without voter approval and $4.00 with voter approval, while K-12 districts may levy a rate of $0.40 for every $1,000 of assessed local property wealth without voter approval and $8.00 with voter approval. Other levies for specific purposes, including those to fund vocational building programs, capital improvements, transportation, and summer school programs, are subject to their own limits and voter approval requirements.

The law also provides for counties to opt into a different set of property tax limitations. School districts in counties that do so are exempt from the limit on the tax rate for educational purposes. They are instead limited to property tax increases of the lesser 5%, or the increase in the national Consumer Price Index for the year preceding the levy year. Tax rate increases exceeding this limit require voter approval. Additionally, property taxes imposed by the board of Chicago Public Schools are bound by different limits on tax rates for educational purposes, capital improvements, and employer contributions to the Public School Teachers’ Pension and Retirement Fund of Chicago.

References:
105 Ill. Comp. Stat. Ann. 5/17-2 (Lexis 2017).
105 Ill. Comp. Stat. Ann. 5/17-2.1 (Lexis 2017).
105 Ill. Comp. Stat. Ann. 5/17-2.11 (Lexis 2017).
105 Ill. Comp. Stat. Ann. 5/17-2.2a (Lexis 2017).
105 Ill. Comp. Stat. Ann. 5/17-2.3 (Lexis 2017).
105 Ill. Comp. Stat. Ann. 5/17-3 (Lexis 2017).
105 Ill. Comp. Stat. Ann. 5/17-3.6 (Lexis 2017).
105 Ill. Comp. Stat. Ann. 5/17-5 (Lexis 2017).
105 Ill. Comp. Stat. Ann. 5/34-53 (Lexis 2017).
105 Ill. Comp. Stat. Ann. 5/34-53.5 (Lexis 2017).
105 Ill. Comp. Stat. Ann. 5/34A-503 (Lexis 2017).
Illinois Department of Revenue, Office of Local Government Services, An Overview of the Property Tax Extension Limitation Law by Referendum, (Chicago, IL Illinois Department of Revenue, 2014),
Jason Hall, Division Administrator, State Funding and Forecasting, Illinois State Board of Education, email message to EdBuild, January 25, 2017.
Other Local Taxes for Education

School districts in Illinois may receive local revenue from school district property taxes and from county sales taxes.

Though school districts in Illinois may only impose local property taxes, counties may impose a tax on retailers and service providers as a percentage of sales receipts for school facilities expenses. In order to impose this tax, the county must have the support of the school boards representing more than half the students in the county and the approval of voters in a referendum. Counties may impose a rate of up to 1% to raise revenue for school facilities expenses. The tax may only be imposed in multiples of 0.25%. The revenue raised by the sales tax will be distributed to school districts within the county based on the district’s enrollment as compared to the total number of resident students in the county as a whole.

This county sales tax applies to the sale of all goods except for groceries and prescription medication.

References:
105 Ill. Comp. Stat. Ann. 5/17 (Lexis 2017).
55 Ill. Comp. Stat. Ann. 5/5-1006.7 (Lexis 2017).
District Characteristics
Grade Level

The Illinois funding formula calculates different levels of funding for students in different grade levels. It does so through its resource-based formula by specifying different student-to-teacher ratios for two different grade spans and providing funding for teacher positions accordingly.

The state assigns a student-to-teacher ratio of 20 to 1 for grades K-3 and 25 to 1 for grades 4-12. These ratios determine the number of teaching units to which a district is entitled. (The ratios are lower for low-income students in these grade spans; see “Poverty” for a description of this calculation.) Specialists, principals, assistant principals, guidance counselors, librarians, and certain other staff members are also assigned in accordance with different student-to-staff ratios depending on the type of school (elementary, middle, or high schools). Once all staff positions are calculated for a district, with grade-level variation taken into account, the district’s formula calculation includes a dollar amount for each position that matches the state average salary for that position. These calculations form the basis of districts’ calculated education costs.

Because the state plans to move toward full formula funding over the span of a number of years, annual increases in funding are distributed to districts with the greatest need for state assistance. Districts are sorted into tiers according to the degree to which their local funding capacity can be expected to cover their local education costs, and a greater percentage of additional state aid is distributed to districts with lesser funding capacity.

References:
Jaclyn Matthews, Director of Media and External Communications, Illinois State Board of Education, email message to EdBuild, November 12, 2017.
“Understanding Evidence‐Based Funding” (PowerPoint presentation, Illinois State Board of Education, 2017),
English-Language Learner

Illinois provides increased funding for English-language learners (ELLs). It does so both through its resource-based formula by calculating specific funding for ELL staff positions and through program-based allocations.

ELLs generate additional staff positions in their districts’ formula calculations. The state assigns an ELL-student-to-teacher ratio of 100 to 1 for English learner core teachers; 125 to 1 for intervention teachers; 125 to 1 for pupil support teachers; 120 to 1 for extended-day teachers; and 120 to 1 for summer school teachers. Eligible students are those participating in transitional bilingual or other transitional English-language instruction programs who were either not born in the United States or whose parents possess limited English-speaking ability and who are unable to perform ordinary classwork in English. Once all staff positions are calculated for a district, the district’s formula calculation includes a dollar amount for each position that matches the state average salary for that position. Because the state plans to move toward full formula funding over the span of a number of years, annual increases in funding are distributed to districts with the greatest need for state assistance. Districts are sorted into tiers according to the degree to which their local funding capacity can be expected to cover their local education costs, and a greater percentage of additional state aid is distributed to districts with lesser funding capacity.

The state also provides program-based funding to districts for ELL technical assistance, professional development, and other support services. Separately, districts continue to receive funding from the state that is equal to or exceeds the amount they received prior to the state’s last major funding reform, which included a grant for English learner education.

References:
105 Ill. Comp. Stat. Ann. 5/14C-2(d) (Lexis 2017).
105 Ill. Comp. Stat. Ann. 5/18-8.15(a)(4) (Lexis 2017).
Jaclyn Matthews, Director of Media and External Communications, Illinois State Board of Education, email message to EdBuild, November 12, 2017.
“Understanding Evidence‐Based Funding” (PowerPoint presentation, Illinois State Board of Education, 2017),
Poverty

Illinois provides funding for students from low-income households. It does so through its resource-based formula by specifying student-to-staff ratios for low-income students and calculating specific funding for dedicated staff positions.

The state’s student-to-teacher ratios for different grade spans are decreased for low-income students. (Students are counted as low-income if they are eligible for Medicaid, the Children’s Health Insurance Program, TANF, or the Supplemental Nutrition Assistance Program.) The state assigns a student-to-teacher ratio of 15 to 1 for low-income students in grades K-3 and 20 to 1 for low-income students in grades 4-12. Low-income students also generate additional staff positions for their districts. The state assigns a low-income-student-to-teacher ratio of 125 to 1 for intervention teachers; 125 to 1 for pupil support teachers; 120 to 1 for extended-day teachers; and 120 to 1 for summer school teachers. Once all staff positions are calculated for a district, with grade-level variation taken into account, the district’s formula calculation includes a dollar amount for each position that matches the state average salary for that position. Because the state plans to move toward full formula funding over the span of a number of years, annual increases in funding are distributed to districts with the greatest need for state assistance. Districts are sorted into tiers according to the degree to which their local funding capacity can be expected to cover their local education costs, and a greater percentage of additional state aid is distributed to districts with lesser funding capacity.

If grade-specific counts of low-income students are unavailable, then the state applies the district’s general percentage of low-income students to the total count of students in each grade to estimate a grade-specific number of low-income students. Separately, districts continue to receive funding from the state that is equal to or exceeds the amount they received prior to the state’s last major funding reform, including a portion of a grant that was calculated based on the district’s concentration of students from low-income households.

References:
105 Ill. Comp. Stat. Ann. 5/18-8.15(a)(4) (Lexis 2017).
Jaclyn Matthews, Director of Media and External Communications, Illinois State Board of Education, email message to EdBuild, November 12, 2017.
“Understanding Evidence‐Based Funding” (PowerPoint presentation, Illinois State Board of Education, 2017),
Special Education

Illinois funds special education using a hybrid system incorporating a resource-based system, which determines the cost of delivering special education based on the cost of the resources required, and census-based assumptions, or assumptions that a set percentage of students in each district will require special education services.

Special education is funded through support for additional staff positions. These positions are allocated in accordance with student-to-teacher ratios that are based on the district’s full enrollment count rather than on a count of students with disabilities. The state assigns a student-to-staff ratio of 141 to 1 for special education core teachers and instructional assistants, and 1000 to 1 for psychologists. Once all staff positions are calculated for a district, the district’s formula calculation includes a dollar amount for each position that matches the state average salary for that position. Because the state plans to move full formula funding over the span of a number of years, annual increases in funding are distributed to districts with the greatest need for state assistance. Districts are sorted into tiers according to the degree to which their local funding capacity can be expected to cover their local education costs, and a greater percentage of additional state aid is distributed to districts with lesser funding capacity.

The remainder of state education funding is distributed through program-specific allocations, including funding for special education transportation and full or partial reimbursements for tuition for students with disabilities enrolled in private schools or under state guardianship. Separately, districts continue to receive funding from the state equal to or more than the amount they received prior to the state’s last major funding reform (with minor adjustments), which included three grants related to special education.

References:
Illinois State Board of Education, Division of Funding and Disbursement Services, Overview of Special Education Funding, (Springfield, IL: Illinois State Board of Education, October 2017),
Jaclyn Matthews, Director of Media and External Communications, Illinois State Board of Education, email message to EdBuild, November 12, 2017.
“Understanding Evidence‐Based Funding” (PowerPoint presentation, Illinois State Board of Education, 2017),
Gifted

Illinois provides increased funding for gifted and talented students. It does so by adding a flat allocation for each student in the district.

For FY2019, the state increases each district’s formula calculation by $40 per student to support gifted and talented education. This money is calculated in accordance with the total enrollment of the district rather than a specific count of gifted and talented students.

Because the state plans to move toward full formula funding over the span of a number of years, annual increases in funding are distributed to districts with the greatest need for state assistance. Districts are sorted into tiers according to the degree to which their local funding capacity can be expected to cover their local education costs, and a greater percentage of additional state aid is distributed to districts with lesser funding capacity.

References:
Jaclyn Matthews, Director of Media and External Communications, Illinois State Board of Education, email message to EdBuild, November 12, 2017.
“Understanding Evidence‐Based Funding” (PowerPoint presentation, Illinois State Board of Education, 2017),
Career and Technical Education

Illinois provides increased funding for career and technical education (CTE) programs. It does so through program-based allocations.

In FY2017, the state allocated $38.06 million for CTE programs. The state also allocated $1.8 million for grants to districts conducting agricultural education programs.

References:
P.A. 100-0021, § 135-15, 100th Ill. Gen. Ass. (2017),
Sparsity and/or Small Size

Illinois does not provide increased funding for sparse districts or for small schools or districts.