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Pursuant to Section 22-55-104 C.R.S., Legislative Council Staff, in consultation with the State Auditor, the State Treasurer, the Department of Education, the Office of State Planning and Budgeting, and the Joint Budget Committee, is required to conduct a review of the model used to forecast revenue to and expenditures from the State Education Fund and the spending requirements for the Public School Finance Act of 1994 by February 1 of each year.

Report No. 2019-TE5

Note: A more recent evaluation was issued in December 2023. Click HERE to access the December 2023 report.

During the 2018 legislative session, the General Assembly considered measures related to public school funding in Colorado.  Specifically, the legislature considered bills pertaining to kindergarten through twelfth grade (K-12) school funding, tax credits and deductions, grant programs, school building maintenance funding, higher education funding, and funding for full‑day kindergarten.

During the 2018 legislative session, the General Assembly considered measures related to kindergarten through twelfth grade (K-12) education in Colorado. Specifically, the legislature considered bills pertaining to early childhood education, school safety, workforce readiness programs in schools, and incentive programs for teachers.

The Legislative Interim Committee on School Finance was created to study issues related to school funding and to consider alternative school finance funding formulas during the 2017 and 2018 interims.

Final Report to the Colorado General Assembly by the School Start Time Interim Study Committee.

The Early Childhood and School Readiness Legislative Commission was created pursuant to Section 26-6.5-203, Colorado Revised Statutes. The purpose of this commission is to study issues related to early childhood and school readiness in order to improve the state’s early childhood policies.

The financing of K-12 public education in Colorado over the past three decades has been affected by three constitutional amendments: the Gallagher Amendment, the TABOR Amendment, and Amendment 23.  Combined with the results of key court cases, these amendments have created a complex educational funding system for the General Assembly to negotiate.  Diminished tax revenue during recessionary periods has also contributed to the struggle for state and local governments to maintain consistent K-12 public education funding levels

House Bill 18-1379 amends the Public School Finance Act of 1994 to provide funding for school districts in FY 2018‑19.  The bill was signed by the Governor on May 24, 2018, and became effective on that date.  House Bill 18-1322, the "Long Bill," appropriates most of the state aid distributed to school districts.  The following summarizes the primary funding changes contained in these bills.

During the 2008 session, the General Assembly enacted House Bill 08-1335, the Building Excellent Schools Today (BEST) act. The act replaced existing law concerning state financial assistance for public school capital construction and established a grant program in order to accelerate funding for K-12 capital construction. This issue brief discusses the origins and administration of the BEST program and funding for BEST projects.

Introduced House Bill 18-1379

Legislative Council Staff conducts a study of the cost of living in each school district every two years to update the cost-of-living factors used in the state's school finance funding formula as required by state law.  The first study was conducted in 1993, and a study has been conducted during the summer and fall of each odd-numbered year since.  The 2017 study results are used to determine school district cost-of-living factors for fiscal years 2018-19 and 2019-20.  The results of the 2017 study indicate that the cost of living, adjusted by where employees live,

2017 Colorado School District Cost of Living Analysis

    Pursuant to Section 22-55-104 C.R.S., Legislative Council Staff, in consultation with the State Auditor, the State Treasurer, the Department of Education, the Office of State Planning and Budgeting, and the Joint Budget Committee, is required to conduct a review of the model used to forecast revenue to and expenditures from the State Education Fund and the spending requirements for the Public School Finance Act of 1994 by February 1 of each year.

Senate Bill 17-296 amends the Public School Finance Act of 1994 to provide funding for school districts in FY 2017-18. The bill was signed by the Governor on June 2, 2017, and became effective on that date. Senate Bill 17-254, the "Long Bill," appropriates most of the state aid distributed to school districts. The following summarizes the primary funding changes contained in these bills.

The final Residential Assessment Rate Study released by the Division of Property Taxation on April 17, 2017 estimates a residential assessment rate of 7.20 percent for 2017 and 2018.  The General Assembly must pass a bill before this rate becomes law.  Compared with the baseline forecast which was predicated on the December 2016 Legislative Council Staff assessed values forecast, the local share for school finance with a residential assessment rate of 7.20 percent will increase by between $48.7 million and $214.2 million in FY 2017-18.

A video presentation about Colorado property taxes and the Gallagher Amendment.  It is anticipated that the residential assessment rate will be reduced for the first time in 14 years, impacting homeowners and the tax base of every local taxing jurisdiction in the state.

(10 minutes 49 seconds, 136 MB).

Where are we?

• 11.5% lower than the formula
• Local share falling or slowing
• State Education Fund close to depleted
• General Fund budget in cutting mode

How did we get here?

• Business cycle, demographic changes, and constitutional requirements

Where are we going?

• Slower revenue growth
• Greater pressure on expenditures

Presented to the Joint Education Committee on February 8, 2017.

The forecast for the State Education Fund and the level of General Fund appropriations needed to pay for school finance have changed from when the General Assembly adjourned in May 2016. Property values grew rapidly in 2016, and are expected to continue to grow over the next few years. The increase in property values, however, is expected to be offset by a decline in the residential assessment rate (RAR) per the provisions of the Gallagher Amendment. Thus, property tax revenue available for the local share of school finance will not be as much as previously anticipated.

Presented to the Joint Education Committee on January 25, 2017.