LEGISLATIVE SERVICES AGENCY
OFFICE OF FISCAL AND MANAGEMENT ANALYSIS
FISCAL IMPACT STATEMENT
LS 6771 NOTE PREPARED: Dec 26, 2024
BILL NUMBER: SB 213 BILL AMENDED:
SUBJECT: K-12 Education Funding.
FIRST AUTHOR: Sen. Qaddoura BILL STATUS: As Introduced
FIRST SPONSOR:
FUNDS AFFECTED:XGENERAL IMPACT: State & Local
XDEDICATED
XFEDERAL
Summary of Legislation: Teacher Salary: This bill requires each school corporation to establish a minimum
salary of $65,000 for each full-time teacher not later than July 1, 2027.
On My Way Pre-K and CCDF: The bill increases the income cap of a family that may participate in the on
My Way Prekindergarten Program from 150% to 185% of the federal poverty level. It provides that a child
who is otherwise eligible for participation in the federal CCDF voucher program may continue to participate
unless the child's family income exceeds 300% of the federal income poverty level.
State Tuition Support Funding Formula: This bill increases school funding by 6% in 2026 and 6% in 2027
for the following categories:
(1) Foundation amount.
(2) Complexity.
(3) Academic performance grants.
(4) Special education.
(5) Career and technical training.
(6) Non-English Speaking Program grants.
Additional Appropriations: The bill appropriates (and increases from the previous budget) funding for the
following programs each year of the biennium beginning July 1, 2025:
(1) $35 M each year for Indiana Secured School Safety Grants.
(2) $30 M each year for Summer School Programs.
(3) $200 M each year to the Curricular Materials Fund for purposes of the fund.
Student Support Services and Teacher Retention Program: This bill establishes the Student Support Services
and Teacher Retention Grant Program and Fund to be administered by the Department of Education. The bill
provides that the purpose of the program is to address the ongoing challenges with teacher attraction and
retention and shortages in critical student support service areas. It appropriates $50 M to the fund for
purposes of the program and for recruitment, hiring, and retention strategies for educators and support staff.
It also requires the program to be administered in conjunction with the:
SB 213 1 (1) School Intervention and Career Counseling Development Program;
(2) Elementary School Counselors, Social Workers, and School Psychologists Program; and
(3) Grants for mental health counselor licenses for school counselors;
in a manner that streamlines these under the overall purposes of the program
Collective Bargaining: The bill provides that a school employer may discuss certain items with the exclusive
representative of certificated employees with regard to expenditures for education service centers of a public
school corporation and expenditures from the Indiana secured school fund for school safety purposes.
Effective Date: Upon passage; June 29, 2025; July 1, 2025.
Explanation of State Expenditures: Summary - The bill’s changes to the State Tuition Support Funding
Formula and increases to the appropriations for certain programs are expected to increase expenditures by
$574 M in FY 2026 and by $1.1 B in FY 2027.
FY 2025 FY 2026 FY 2027
State Tuition Support Funding Formula $9 B $9.5 B $10.1 B
Curricular Materials Fund Appropriation $160 M $200 M $200 M
Indiana Secured School Safety Grants $24.6 M $35 M $35 M
Summer School Programs $18.4 M $30 M $30 M
Total $9.2 B $9.8 B $10.4 B
An additional $50 M is also appropriated over the FY 2026-FY 2027 biennium to the Student Support
Services and Teacher Retention Program established in this bill. Other provisions changing the Child Care
and Development Fund (CCDF) may also increase state expenditures by an indeterminate amount.
Additional Information -
State Tuition Support Funding Formula: The bill annually increases the grant awards in the current state
tuition support formula by 6% in FY 2026 and FY 2027. This will increase state tuition support expenditures
by an estimated $511 M in FY 2026 and $1.1 B in FY 2027.
Tuition support payments distributed to schools are dependent on the amount appropriated towards state
tuition support. [In FY 2025, $9.03 B was appropriated for these purposes.] If the distributions exceed the
appropriation, up to $25 M per fiscal year can be transferred from the State Tuition Reserve Account in order
to fund the difference. If the amount appropriated plus the $25 M (augmented appropriation) is still less than
the actual distribution, the distribution would be reduced so that it equals the augmented appropriation.
Curricular Materials Fund: The bill appropriates $200 M during the FY 2026-FY 2027 biennium to the
Curricular Materials Fund, which will be distributed to schools for curricular material reimbursements. In
FY 2025, schools reported $246 M in curricular material expenditures to DOE and $160 M was appropriated
to the Curricular Materials Fund over the FY 2024-FY 2025 biennium.
SB 213 2 Indiana Secured School Safety Grants: The bill appropriates $35 M per year to the Indiana Secured School
Program over the FY 2026-FY 2027 biennium. Indiana schools can apply for a matching grant from the
Indiana Secured School Program to increase school safety. In FY 2025, nearly 500 schools applied for
approximately $33 M in Secured School Safety matching grants. However, 466 applications were only
partially funded as only $24.6 M was appropriated for these purposes in FY 2025.
Summer School: The bill appropriates $30 M per year over the FY 2026-FY2027 biennium to reimburse
public schools for approved summer school expenditures. $18.4 M was appropriated and distributed for this
purpose in FY 2025, although public schools qualified to receive up to $27.8 M if funding was available.
[Public schools are reimbursed for approved summer school courses based on the actual instructional costs,
multiplied by 1.05, and reduced proportionately if the appropriation is insufficient to fund all programs at
100%.]
Student Support Services and Teacher Retention Program: The bill appropriates $50 M to the Department
of Education (DOE) for the biennium beginning July 1, 2025, and ending June 30, 2027, to establish and
administer the Student Support Services and Teacher Retention Program. These funds must be used for
recruiting, hiring, and retention strategies for educators and support staff.
CCDF: This bill increases the income eligibility threshold to remain in the CCDF program from 85% of the
State Median Income (SMI) to 300% of the Federal Poverty Level (FPL). In CY 2024, 85% SMI ranged
between 260% FPL and 280% FPL depending on family size, although recent trends suggest that SMI is
growing faster than the FPL. The state may continue to use federal CCDF funds to provide services to
eligible students if their income does not exceed 85% SMI. However the state must use other federal, state,
or local funds to continue providing CCDF benefits to children whose family income exceeds 85% but who
otherwise meet the bill’s eligibility threshold of 300% FPL. The cost to continue providing these children
CCDF benefits is an estimated $9,300 per child. The impact to state expenditures is ultimately dependent
on the number of CCDF participants whose household income exceeds 85% SMI, and the extent that the
Family and Social Services Administration (FSSA) utilizes other federal or local funds to cover the cost to
continue providing these children CCDF benefits.
On My Way Pre-K: Under existing statute, children who qualify for On My Way PreK (OMWP) without a
limited eligibility provision also meet the income eligibility guidelines to qualify for CCDF. [CCDF
participants must have a household income below 150% FPL to participate in CCDF, although other
provisions in this bill allow participants to remain in the program until their household income exceeds 300%
FPL. In FY 2024, 6.7% of state CCDF recipients had a household income greater than 150% FPL.] Although
CCDF vouchers can be used to pay for pre-k programs, these federal funds may instead be shifted towards
other uses dependent on the extent that state funds cover pre-k costs for CCDF recipients through OMWP.
By increasing the eligibility limit to participate in OMWP from 150% FPL to 185% FPL, the bills provisions
are expected to decrease the number of OMWP recipients who also qualify for CCDF. This would reduce
the extent that CCDF vouchers can be shifted towards other uses.
Explanation of State Revenues:
Explanation of Local Expenditures: CCDF: Provisions in the bill require the state to find other funding
sources to cover the costs of certain children who exceed the federal CCDF redetermination limit. Dependent
on the extent that local funds are used, local expenditures could increase. [See Explanation of State
Expenditures.]
SB 213 3 Public Schools: The bill appropriates additional funds to the Indiana Secured School Safety Grants and
allows funds appropriated to the Student Support Services and Teacher Retention Program to be transferred
to existing grants and programs available to public schools. To the extent that these provisions increase the
number of schools who apply for and are required to adhere to grant or program requirements, public school
workloads will increase.
Teacher Salary: The bill will require more school corporations to submit a report to DOE explaining the
school corporation’s inability to meet the minimum threshold requirement. Using data school corporations
submitted to DOE with salary and position information, LSA estimates that in FY 2024, of the 281 school
corporations that reported salary data, 221 had minimum salaries at or above $40,000, but no school
corporations had a minimum salary at or above $65,000.
Explanation of Local Revenues: Provisions in the bill are estimated to increase public school revenue from
state tuition support, curricular materials reimbursements, secured school safety grants, and summer school
reimbursements by the following amounts.
FY 2026 FY 2027
State Tuition Support Funding Formula $511.5 M $1.1B
Curricular Materials Fund Appropriation $40 M $40 M
Indiana Secured School Safety Grants $10.4 M $10.4 M
Summer School Programs $11.6 M $11.6 M
Total $573.5 M $1.1 B
School revenue could increase further dependent on the extent that appropriations made to the Student
Support Services and Teacher Retention Program are made available to public schools by transferring funds
to existing grant programs. [See Explanation of State Expenditures.]
State Agencies Affected: Department of Education; Family and Social Services Administration; Department
of Homeland Security.
Local Agencies Affected: Public schools.
Information Sources: Office of early Childhood and Out of School learning, 2024 CCDF Voucher and
CCDF Centers Programs.
U.S. Census Bureau, American Community Survey, 2022. ACS Indiana 1-Year Estimates Detailed Tables.
Department of Education; Department of Homeland Security; LSA Education Database.
Fiscal Analyst: Kelan Fong, 317-232-9592.
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