HomeOregon NewsGovernor Kotek proposes $515 million boost to Oregon's State School Fund for...

Governor Kotek proposes $515 million boost to Oregon’s State School Fund for next year despite funding challenges

Oregon – Aiming to pump an extra $515 million into the State School Fund over the 2025-27 biennium, Governor Tina Kotek has proposed major reforms to Oregon’s school funding model in response to a potential economic collapse for the public schools. This action coincides with Oregon’s schools confronting the termination of significant federal COVID relief money supporting various educational initiatives since 2020.

With the $1.6 billion in government subsidies expiring this September, Governor Kotek’s plan aims to solve the urgent financial difficulties presented. Nearly all Oregon’s school systems—including the state’s biggest in Portland—have run out of these resources, which have been vital in preserving staffing and programs among mounting expenses and dwindling enrollment.

A protracted strike last fall by Portland Public School teachers motivated by issues with low pay and poor working conditions underlined the urgency of the matter. Over a month of striking motivated Kotek to review Oregon’s school system’s funding and compensation policies. Leaders from other big districts have also expressed financial difficulties, which has led multiple superintendents to collectively call for more instructional funding. These officials called the financial shortfall a “crisis,” pointing to their tough choices to eliminate hundreds of jobs to keep schools running in a May video.

Proposing that schools receive 49% of their budget in the first year of the biennial cycle and 51% in the second, Governor Kotek’s financial revamp includes a review of how the State School Fund distributes money, therefore diverting from the current even split. This change seeks to give schools a better cushion against biennium rising of costs. Kotek also suggests changing the state’s future compensation cost projection technique to reflect more recent wage data, therefore adding almost $500 million for recruiting necessary educational staff.

Moreover, the governor advises that annual variations in municipal property tax collections should be taken into account annually rather than only in the first year of the budgetary cycle. Schools in the forthcoming biennial budget are expected to get additional $55 million from this shift.

Kotek has proposed major reforms to Oregon's school funding model in response to a potential economic collapse for the public schools.
Credit: Unsplash

Despite these hopeful ideas, questions remain about where the money for these raises would come from, especially in light of absent additional tax increases or income sources. Chair of the Senate Education Committee, Senator Michael Dembrow voiced concerns about possible losses to other vital sectors, including higher education, to allow the extra half-billion dollars for K–12 education.

With leaders expressing relief and gratitude for the governor’s dedication to changing school funding, the educational community has generally embraced Kotek’s news. These developments, however, are only a beginning for a larger discussion on fairly and consistently paying Oregon’s schools, as Emielle Nischik, interim executive director of the Oregon School Boards Association, noted. When Kotek’s budget numbers come out in December, it will be easier to see how beneficial her ideas are and will help to prepare the ground for a critical legislative debate on Oregon’s future educational financing.

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