• Counting the number of students in each district takes on added importance because the counts are used for distribution of state foundation allowance funding.
• Because many districts have moved to remote learning only and others are offering some type of hybrid model of instruction, counting students physically present in a school building on a particular day is not an option this year.
• With the policy changes adopted as part of “Return to Learn” and the 2020-21 School Aid budget, all districts now have a method to count students regardless of their learning environment and are assured that they will receive the full per-pupil funding revenue that accompanies each student they enroll.

Counting the number of students enrolled in public schools this fall will be one of the many things that school officials will do completely differently this year. What was already a fairly complex, technical, and time-consuming requirement was made even more so by the coronavirus pandemic and the shift to remote learning. This year’s student count day (Wednesday, October 7) was like no other before it. 

To adapt to the realities of the pandemic, policymakers modified how the state counts students and changed how it determines pupil “membership” for purposes of distributing funding. The funding policy change seeks to ease the financial pinch districts anticipate from widespread enrollment losses. But, it also reverses course on the state’s long-standing policy that “funding follows the student” to the school district he or she enrolls in. Since adopting the new student count policy, the legislature passed a measure to mitigate the unintended financial harm that growing districts would incur under the new policy. 

Counting Students in the Time of Coronavirus

Since the adoption of Michigan’s current school funding system in 1994, a school district’s total budget has been primarily determined by the number of enrolled students. Districts receive a fixed amount of money, called a foundation allowance, for every pupil enrolled. In a normal school year, the student count is based on counts conducted in the fall and the previous spring. Normally, the two counts are weighted differently (90 percent of the current-year fall count and 10 percent of the previous-year spring count) and then added together to arrive at a “blended” enrollment count (or “membership” in the parlance of the School Aid Act).

But this year is anything but normal for public education. Because many districts have moved to remote learning only and others are offering some type of hybrid model of instruction, counting students physically present in a school building on a particular day is not an option. The state did not have a method for counting students “attending” school in these settings. That is why state lawmakers, in late August, adopted entirely new and different methods to count students and distribute state aid this fall. 

Counting students during the pandemic was just one of many issues addressed in a bi-partisan “Return to Learn” legislative package approved weeks before the start of school this fall.  Lansing policymakers also made changes in state law dealing with the minimum number of days and hours of instruction that districts had to meet to count students in attendance. For those districts operating in a fully online or hybrid environment, rather than conducting a physical count of students, schools will have to determine the number of students “engaged in pandemic learning” on count day.  This involves schools either documenting that students had multiple two-way interactions with their teachers or that students participated in course-related activities in each class on count day.

The new student count method will be used for both fall 2020 and spring 2021 count days.

Counting Students (or not counting lost students) to Ease Financial Strains

In addition to modifying how students are counted, the “Return to Learn” package changes what student counts are used and the weights assigned to each. Rather than use the traditional 90/10 membership blend, fall 2020-21 student count is based on a “super blend”; 75 percent of a district’s 2019-20 student count (using the fall and spring physical counts from last school year) and 25 percent of a district’s 2020-21 student count (using the new method described above). 

Prior to the Michigan Legislature settling on the “super blend,” a number of school officials, including the State Superintendent, called for a complete student membership “freeze.” They wanted districts to be able to use their 2019-20 attendance numbers for distributing state aid in 2020-21. They argued that freezing enrollment would provide greater funding certainty and stability to their budgets in light of the disruptions caused by the pandemic. Administrators feared that there would be considerable student “churn” in and out of districts, as well as students moving to homeschooling and private education, as parents looked for the best and safest learning environment for their children. 

Freezing enrollment would guarantee that one factor (student enrollment) used in determining the amount of foundation allowance funding districts receive would not change. At the time, schools faced the prospect of a sizable foundation allowance cut due to a projected $1 billion shortfall in the School Aid Fund. Mathematically, this certainly would provide greater year-over-year funding stability for those districts that experience sizable enrollment declines this fall. An enrollment freeze would mitigate the financial impact associated with any reduction in a district’s foundation allowance. (Note: An improved economic outlook and tax revenue estimates eliminated the projected School Aid Fund deficit and allowed for a one-time $65 per-pupil increase in the 2020-21 K-12 education budget.)

The final “Return to Learn” package did not “freeze” district enrollment, but it created an entirely new method that effectively achieves a similar objective. The new law set up a weighting system to give the previous year’s student count three times more importance (i.e., weighting) than the current-year count. From a budget perspective, this allowed a district to receive 75 percent of the per-pupil funding attached to a student that was enrolled the previous year but not this year. In effect, the policy told districts that they did not have to fully count their lost students.

When a Long-Standing Incentive is Suddenly a Disincentive

But wait, what about districts growing their enrollments and adding students during the pandemic? How does this policy affect them and their finances? 

This is especially relevant in the time of coronavirus when families are looking for the best instructional programs and services for their school-age children. While a number of districts anticipated enrollment losses this fall, others planned to welcome new students. Under the state’s various school choice options, including inter-district choice and public charter schools, districts enrolling non-resident students are guaranteed to receive the per-pupil funding that accompanies these students. But that is not the case with the new “super blend” because each added student would only generate 25 percent of a per-pupil allowance. 

By changing the mix of student counts and the weights applied to each count, the state’s long-standing policy that “money follows the student” was compromised. The financial incentive associated with growing district enrollment had changed to a disincentive under the new, temporary student count regime. From a budget perspective, growing districts faced the financial reality that they would receive just 25 percent of the per-pupil funding from adding students, but have to incur 100 percent of the costs of educating them. In effect, the state was asking these districts to educate students with about one-quarter of the resources they would normally receive using the traditional count method. 

For growing districts, the math behind the new policy simply does not add up; adding students is a net financial loss, no matter how they spin it. 

Not surprisingly, a handful of districts reacted to the law change by closing their doors to accepting additional non-resident students under inter-district choice. This appears to have caught the attention of state lawmakers because they have since added funding to the 2020-21 school budget to make sure that the long-standing policy that “money follows the student” remains intact and that districts growing their enrollments this year will receive the full per-pupil funding. Effectively, the new provision maintains the financial incentive tied to increasing enrollment and allows growing districts to use the traditional 90/10 student membership blend for determining their 2020-21 student count.

It is certainly clear now, and probably was for many observers at the time of adoption, that the objective behind the “Return to Learn” student count policy was myopic in that it focuses only on helping declining enrollment districts cope with financial hardships caused by the pandemic. But state officials did not have to penalize growing districts to achieve this primary objective. With the policy changes adopted as part of “Return to Learn” and the 2020-21 School Aid budget, all districts now have a method to count students regardless of their learning environment and are assured that they will receive the full per-pupil funding revenue that accompanies each student they enroll.