The Iowa Legislature is considering increasing allowable growth, its rate-per-student funding, from 0 to 2 percent, or replacing it entirely with categorical funding.
Either change would have an impact on the Fort Dodge Community School District.
"Right now, the way it sits from our understanding, is that the legislative body is looking at a 2 percent allowable growth, which means they take a look at their state money and say they will give to school districts new dollars based on the growth they're seeing," Doug Van Zyl, FDCSD superintendent, said.
Last year, the school district received no new monies because there was 0 percent allowable growth, Van Zyl said.
"Prior to that, they've had 2 to 6 to 8 percent allowable growth, which has been helpful to school districts," he said. "In our situation, of course, we've lost over 300 students over the last three years."
Van Zyl said he expects a positive student growth trend this year, though it won't immediately help the school district.
"We always get paid a year behind," he said. "So I'm getting paid this year for the number of students that we had last year, which was 70 students fewer than the year before. So there is fewer dollars that come into the district."
Last year, the district received $6,028 for each of its students, according to Brandon Hansel, FDCSD director of financial services. For each percentage point of allowable growth, the district would receive an additional $60 per student.
"As a rule of thumb, each one percentage point in allowable growth costs the state of Iowa about $20 million," he said. "For us here in Fort Dodge, our allowable growth is going to be, for each one percentage point, about $60.28."
The increase would be substantial for the school district, Hansel said.
"If you take this year's enrollment, it would mean about an additional $220,000 for each one percentage point of allowable growth," he said.
Gov. Terry Branstad has proposed switching from allowable growth to a different method of funding Iowa schools.
"They may do the funding as categorical funding," Van Zyl said. "They may just say, we're going to give you dollars in special ed or for transportation, for certain areas within the budget, and not just give general fund dollars that can then be disbursed where they need to be disbursed."
This would create its own set of issues, Van Zyl said.
"Every district may have different needs for where those dollars may need to go," he said.
The effects of switching to categorical funding on the Fort Dodge school district are not as certain, Hansel said.
"The way I understand it, essentially we would be given, instead of one pool of money for the general fund in state appropriations, we would be given many different, smaller pools of money that can only be used for specific purposes," he said. "Under that scenario, we would have to make sure each expense category pays for its own little area."
The possibility of changes in funding, positive or negative, influences how the district prepares its budget, Van Zyl said.
"That's why we basically build a budget, but it's almost an estimated budget until everything's finalized from the state," he said. "Then we have a better idea of where revenues are going to be."