Arkansas Public School Finance 101

Every school district in Arkansas is required to send to the State 25 mills, the Uniform Rate of Taxation (URT).

Districts retain 100% of local property tax revenue dedicated to public education above 25 mills.

Based on Average Daily Attendance (ADA), the State sends to each district and open-enrollment public charter school, per pupil Foundation funding (currently $6,584 per student).

In 2014-15, Little Rock School District’s 46.4 mills (seventh highest in Arkansas) on assessed valuation of $3,453,638,341 (highest in Arkansas) generated $153,257,140 in local property tax revenue dedicated to education (highest in Arkansas).

Subtracting the 25 mill URT sent to the State ($82,573,890), LRSD retained 100% of remaining property tax revenue dedicated to public education – $68,751,824 – whether it had one student or 100,000.

If a district “loses” a student to an open-enrollment charter school, it still receives 100% State Foundation funding for the next 1.5 years.

When a student is truant, moves, transfers through inter-district school choice, chooses an open-enrollment public charter school, chooses a private school, and/or chooses home school, the maximum, in current dollars, any school district loses in State Foundation funding is $6,584 per student. Meanwhile, it retains 100% of local funds without the expense of educating the student. Therefore, per pupil spending goes up with each student lost.

Additional state, federal funds accompany specific student demographics, such as Gifted and Talented, Alternative Learning Environment, Free and Reduced Lunch, English Language Learners, and Special Education students.

A $63 per pupil increase in State Foundation funding ($1,459,332) and $3,547,990 increase in local property tax revenue totaled a $5,007,322 gain to the district in 2015-16.

When projected enrollment caps are reached in eleven years for the latest eStem Public Charter Schools and LISA Academy expansions, the total annual loss to the district is projected be 1,139 students, $7,499,176 in current annual Foundation dollars.

In other words, 120 proposed new Little Rock Preparatory Academy students, even if 100% came from LRSD, would not equal $1,000,000 annual loss to the LRSD, as one publication has repeatedly quoted the superintendent as saying. Rather, it would be a maximum of $790,080, 21% less. And no charter school in Arkansas, including Little Rock Preparatory Academy, receives 100% of its students from one district.

It continues to be claimed that the recently approved eStem Public Charter Schools and LISA Academy expansions will amount to an annual “loss” to the LRSD of $19,633,488 in State Foundation funding.

Only 54% and 53% of eStem and LISA’s current respective enrollment resides in the LRSD, and only 71% of students in Pulaski County attend traditional schools. Therefore, a more accurate projection of State Foundation funding “loss” to LRSD is $7,499,176 a year in current dollars. Once total new enrollment reaches its cap after 11 years, that’s a difference between what is claimed and what is actually projected of 62%.

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