If you're looking for a good walk-through of state education funding since the Ed Reform Act of 1993, the Mass Budget and Policy Center has done a nice job. This walks you not only through ideas like the foundation formula, but also goes through the alterations made in the funding formula in the past few years, and brings us right up through the Governor and the House budget proposals.
It also points out what we've done before, that the proposed budget breaks the law:
Together these districts would have received $168 million less than the amount they would need to meet the minimum requirements of the Foundation Budget formula. This would likely constitute a violation of the state’s constitutional obligation to ensure that every school district has the resources needed to provide access to an adequate education. While the state could adjust local and state contributions in several different ways to ensure that every district will spend the Foundation Budget amount, it can not, constitutionally, fail to ensure that every district can spend at the Foundation Budget level that is the minimum needed to provide an adequate education to the students in that district.
Both the House and the Governor use federal stimulus dollars to make up the lack, but remember: that isn't Chapter 70 money; it's a federal grant.
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