AMENDATORY VETO OF SB1

FORMULA CHANGES
• SB 1 holds all districts harmless, using FY 17 as a base year. The governor’s amendatory veto
provides only a 3-year district level hold harmless. Beginning with the 2020-2021 school
year, any district that loses enrollment would lose funding. 222 districts lost enrollment
from FY 15 to FY 16.
• SB 1 includes a Minimum Funding Level that is intended to distribute funds more
progressively to districts furthest from adequacy in the case of appropriation lower than the
MFL. In SB 1, the MFL was $350 million. The governor’s amendatory veto removes the
Minimum Funding Level (MFL) entirely.
• SB 1 includes a Regionalization Factor to account for the varying costs of education students
in different parts of the state. The governor’s amendatory veto places a cap on the
Regionalization Factor of 1.04. SB 1 only contained a floor of 0.9 and did not have a cap. A
regionalization cap would reduce the adequacy target for 313 districts. This includes every
district in Cook, DeKalb, DuPage, Grundy, Kane, Kendall, Lake, McHenry, and Will counties.
• SB 1 includes a number of provisions to account for the rising cost of education for districts.
The governor’s amendatory veto removes these escalators (teachers, school support
personnel, and adult basic education) for the adequacy target. Without inflationary
measures, the adequacy target will fail to reflect the true cost of education, which is the
purpose of the evidence based model.
• The governor’s amendatory veto also makes the following changes regarding TIF and PTELL:
• Counts TIF EAV as formula EAV. This would penalize districts because typically
revenue from TIF EAVs is not accessible to districts.
• Removes adjustments for PTELL EAV. PTELL limitations would no longer be
considered. This would have an impact on 70 districts throughout the state.
CPS
• SB 1 provides CPS funding within district’s Base Funding Minimum to cover CPS’ normal
pension costs. In FY 18, this is $221.3 million. The governor’s amendatory veto would no
longer include CPS’ normal cost in the base funding minimum. Instead, the governor is
adding language to the pension code that provides a contribution of $221.3 million for CPS’
normal cost in FY 18 and establishes a continuing appropriation Chicago teacher normal
pension costs in future years.
• SB 1 reduces CPS’ Local Capacity Target by the amount of the district’s unfunded liability in
a given year. The governor’s amendatory veto removes this language entirely.
• SB 1 increases CPS’ Adequacy Target by the amount of the district’s normal pension cost in
a given year. The governor’s amendatory veto does not remove this provision. However, it
does remove language that would apply this language to other school districts if a statewide
pension cost shift were to occur and local districts became responsible for paying that cost.

• SB 1 sunsets the Chicago block grant for line items not included in evidence based funding,
but holds CPS harmless for the $203 million impact to the district as a result of the sunset.
In the future CPS would submit claims for reimbursement like all other districts. The
governor’s amendatory veto repeals the block grant and does not hold CPS harmless for line
items not consolidated into the new formula. This would drive an additional $203 million
through the tiers of the EBM.

EFFECT ON ENACTED FY 18 BUDGET

Absent any change to the enacted FY 18 budget, the amendatory veto will (i) drive an additional
$424.3 million through the EBM distribution formula (above the $350 million anticipated), and
(ii) increase overall state spending by $221.3 million.