Oregon Lawmakers Debate Sweeping Overhaul of Oregon School Funding Formula, Aiming for Modernized System
Oregon lawmakers are actively debating a significant overhaul of the state’s nearly three-decade-old school funding formula. This initiative aims to reshape how public education is financed and ensure greater accountability in Oregon school funding. Senators Janeen Sollman and Representative Ricki Ruiz are spearheading this legislative effort to improve Oregon school funding. They seek to move Oregon’s education system towards a new model for financial support. The Joint Public Education Appropriation Committee has advanced a bill to this end. This crucial legislation will undergo further debate in the upcoming legislative session. The core objective is to rebuild public trust and improve Oregon school funding. It also aims to guarantee measurable progress in education outcomes.
The History of Oregon School Funding
The history of school funding in Oregon is marked by significant legislative action and voter initiatives. Measures like Ballot Measure 5 in 1990 and Measure 50 in 1997 fundamentally altered the landscape of Oregon school funding. These measures capped local property taxes. Consequently, the state assumed a greater role in funding schools. The State School Fund (SSF) emerged as the principal source of financial support for K-12 education. In 1999, the Quality Education Model (QEM) was developed. Its purpose was to determine the true cost of a quality education. The Quality Education Commission (QEC) was statutorily established in 2001. It is tasked with refining the QEM and providing biennial funding recommendations to lawmakers. Despite these efforts, the Legislature has historically failed to fully fund the QEM’s projections for Oregon school funding. This has resulted in persistent funding deficits. The 2024 QEM report, for instance, outlined a need for $12.7 billion for the State School Fund. However, legislative appropriations for Oregon school funding have consistently fallen short of these recommendations.
Current Financial Challenges Facing Oregon’s Schools
Oregon’s public schools currently confront a complex web of financial challenges impacting Oregon school funding. A notable issue is declining student enrollment, which directly impacts state funding allocations, often tied to student population numbers. Furthermore, the persistent rise in inflation contributes to increased operational costs for school districts. A substantial financial strain also comes from escalating employee retirement benefit expenses. These costs now compete with funds designated for direct classroom instruction and student support services, a common issue in K-12 education funding. The expiration of federal COVID-19 relief funds has compounded these fiscal pressures on Oregon school funding. Many school districts are now facing considerable budget shortfalls. For example, Portland Public Schools anticipates a $40 million deficit for the 2025-26 school year. Salem-Keizer Public Schools is preparing for a deficit of at least $25 million. The Medford School District is confronting a $15 million shortfall. These financial crises often necessitate difficult decisions regarding Oregon school funding, including staff layoffs and program reductions.
Proposed Legislative Overhaul for Oregon School Funding
The proposed legislative overhaul seeks to address these systemic issues head-on. Spearheaded by Senators Sollman and Ruiz, the new bill aims to dismantle the existing Quality Education Model and Commission structure impacting Oregon school funding. Under the proposed changes, the responsibility for analyzing school finance needs would transfer to the Legislative Policy and Research Office. This office would then engage external firms for detailed financial analysis, a key component of education reform Oregon. Importantly, these analysts would be required to consult directly with educators across the state to understand their needs for better Oregon school funding.
New Standards and Accountability for Oregon School Funding
A significant aspect of the proposed reform is the establishment of a new definition for a “standard school district” within the context of Oregon school funding. To qualify for state and federal funding, a district would be required to have all its teachers fully licensed. Additionally, schools would be held to standards outlined in a 2024 education accountability law. This law mandates that school districts set specific goals with the Oregon Department of Education, central to K-12 education funding. These goals focus on critical areas such as third-grade reading proficiency, eighth-grade math achievement, ninth-grade on-track rates, and four- and five-year graduation rates, alongside regular attendance. The proposed changes also intend to redefine what constitutes the state’s “quality goals for public education”, influencing the future of Oregon school funding.
Recent Investments and Future Outlook for Oregon School Funding
The 2025 legislative session saw some notable investments in education, impacting Oregon school funding. The State School Fund received a record allocation of $11.36 billion for the 2025-27 biennium, marking an 11% increase. The Student Investment Account was also funded at $1.1 billion. Governor Tina Kotek put forth a proposal to increase the Current Service Level (CSL) for the State School Fund by an estimated $515 million for the upcoming biennium, aiming for more stable Oregon school funding. These adjustments are intended to foster greater funding predictability and accuracy for school districts.
Navigating Fiscal Constraints in Oregon School Funding
However, the state’s fiscal landscape remains complex for Oregon school funding. Federal budget adjustments and revenue fluctuations continue to pose challenges. Certain legislative proposals did not gain traction, particularly those related to the school funding formula. For instance, a bill designed to remove the cap on special education funding was deemed too costly, with an estimated $700 million price tag. Legislators are currently navigating the delicate balance between maintaining essential educational services and managing the state’s financial constraints. The ongoing news and debates surrounding Oregon’s school finance system highlight its evolving nature, particularly concerning the school funding formula. This crucial news signifies a commitment to finding sustainable and equitable solutions for the state’s students and its approach to Oregon school funding.
