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Every year, Colorado school districts must scramble to finish their budgets before June 30. But state lawmakers typically don’t approve the School Finance Act, which signals how much state money districts stand to receive, until the last days of the legislative session.
The timing of the bill’s passage has been a point of contention for school finance officers, who have called for changes for years.
“We try to hold everything off until we know the state picture,” said Mike Madden, finance director for Delta County Joint District 50.
This year, a group of lawmakers have sought to fix that problem, filing the School Finance Act on the first day of session, the earliest it’s been filed in recent years. However, the effort might be mostly symbolic, because state education funding remains vulnerable to other budget maneuvers.
School administrators said lawmakers have a history of cutting money from schools in different ways due to budget challenges. Last year, legislators facing a $1.2 billion budget shortfall cut school funding through a renegotiation of a funding formula approved just a year earlier. In previous years, lawmakers cut funding through the Budget Stabilization Factor, which allowed them to use constitutionally mandated school funding for other priorities.
This year, with the state facing an $850 million budget hole, Madden and other finance officers said they’re wary that further cuts in the 2026-27 fiscal year funding will occur. They’re also concerned about federal budget impacts, and a proposed change to how the state calculates Specific Ownership Tax, although it might not kick in immediately. Coloradans pay these taxes every year when they register their vehicles.
Jana Schleusner, Douglas County School District’s chief financial officer, said that changes lawmakers have made to school finance are hard for families and taxpayers to follow, but that they amount to balancing the state budget on the backs of schools.
“If you’re going to cut, stop playing these games around the edges, and let’s be real about what we’re doing to education,” Schleusner said.
Sponsors aim to make school discussion a priority
This year’s budget conversations are just getting underway, and it’s unlikely the Joint Budget Committee will make any major decisions until after the state’s March revenue and economic forecast.
State Sen. Barbara Kirkmeyer, a Weld County Republican who sits on the JBC, said she filed the School Finance Act ahead of time to get fellow lawmakers to make school funding the legislature’s first priority. State Sen. Chris Kolker and Rep. Eliza Hamrick, both Democrats from Centennial, are also sponsors.
The bill calls for $10.2 billion in statewide education funding, compared with about $10 billion this year. The calculations are based on the baseline funding promises made last year, Kirkmeyer said
“Funding education should come first,” said Kirkmeyer, who is running for governor.
Kolker said he understands why finance officers are so wary about cuts. He said he will fight to preserve school funding based on the promises lawmakers have made.
“I filed this bill to make it transparent and try to lessen their apprehensions, because these school finance officers need to know early what they’re getting so they can then set their budgets,” he said.
School district budget pictures get murkier when lawmakers propose cuts to state education funding, said Terry Kimber, Widefield School District 3’s chief finance officer.
For example, last year’s change to the school finance formula left districts scrambling to understand how much they would get from the state. District administrators held off on hiring staff, he said, and educators didn’t know whether they’d get a raise.
Many sources of concern over funding
It’s unclear whether lawmakers writing the state budget will decide to try to make funding changes for schools again this year, said Tracie Rainey, Colorado School Finance Project executive director.
What’s certain is that lawmakers have a tough budget outlook that will require many cuts, she said. “I think that’s what’s going to determine a lot of this, more than just the intent behind school finance,” she said.
District leaders are worried about how federal funding cuts might impact schools, Rainey said. The state has sued the Trump administration over these cuts.
They’re also worried that lawmakers will make statutory changes that calculate how Specific Ownership Tax revenue counts toward what schools get from the state.
Colorado’s school finance formula does not count all Specific Ownership Tax revenue as money collected by a district, according to state budget documents. This is important because some districts have asked local voters to approve additional taxes for schools. The law says the extra tax revenue doesn’t get counted against the districts in determining what they get from the state.
Changing state law to count all Specific Ownership Tax collected would increase how much districts are expected to pay toward education and decrease what the state needs to pay. This would decrease the state’s obligation toward schools by about $200 million.
Budget documents released on Jan. 23 propose for this change to be phased-in over two years: the 2027-28 and 2028-29 budget years.
School leaders have pushed back on the proposal. Kolker and others have committed to ensuring the idea doesn’t pass.
Kimber said he just wants lawmakers to keep the promises they’ve made after years of uncertainty.
“When we make these agreements,” Kimber said, “they should stand by them.”
Jason Gonzales is a reporter covering higher education and the Colorado legislature. Chalkbeat Colorado partners with Open Campus on higher education coverage. Contact Jason at jgonzales@chalkbeat.org.
