Funding Special Education Services

15 states: AK, CA, CO, CT, HI, LA, MD, MO, NC, ND, NH, NJ, NY, OR and VT

Weighted funding is the most common funding mechanism for distributing special education funding to districts. Through this approach, the state applies an add-on percentage or dollar amount to the base amount awarded per eligible student. The state has a single weighted adjustment factor for all students identified for special education services. Allocations determined by single weights do not differentiate based on the different services that a student receives.

Colorado’s revised K-12 funding formula uses a single-weight approach to fund special education. The formula, which is being phased in over six years starting in 2025-26 budget year, takes the statewide base per pupil rate of $8,691.80 and multiplies it by a 25% weight and the district’s special education count. The criteria for special education count will be based on whether a student has an Individualized Education Program (IEP). The state will maintain its existing categorical grants outside of the revised formula which provide multiple per student grants.

25 states and the District of Columbia: AL, AZ, CO, DC, FL, GA, HI, IA, IN, KY, MA, ME, MN, MO, MS, NM, NV, OH, OK, PA, SC, SD, TN, TX, UT and WA

This approach involves multiplying multiple percentages by the base amount or adding more than one dollar figure to the base amount to differentiate funding based on student need or type of service being provided. For instance, the weights can be assigned based on severity of disability by classifying the IDEA disability categories into groups (e.g., “mild,” “moderate” or “severe”); for each specific disability (e.g.,  students with visual impairments receive a weight of X% and autistic students receive a weight of Y%); or on the placement of the student (e.g., students who are educated out-of-district or in a private facility receive a weight of X%).

Ohio funds special education by assigning six different weights based on the IDEA disability category. The weights in the categories range from an additional 24% for speech, language impairments up to an additional 395% for students who have had a traumatic brain injury or are both visually and hearing impaired. The state multiplies the weight by the number of students with that diagnosis and by the state's share percentage. This percentage is calculated based on property values and income for residents in the district, with the state taking on a larger share of costs in areas with lower property values and lower personal income per capita.

6 states: AR, DE, ID, IL, VA and WV

Under this funding mechanism, the state determines the cost of special education instructional resources and staffing (using average salaries and student enrollment numbers) and allocates funds to pay a portion of those costs. For example, the state would provide one special education teacher and one instructional assistant for every X number of students who receive special education services and one psychologist for every Y number of students who require special education services. This mechanism tries to connect state dollars to the actual services that will be provided for students through a focus on staffing.  

Illinois’ resource-based funding involves calculating an adequacy target every year. That target is the calculated cost to educate students within the district based on the cost factors outlined in their formula, called Evidence-Based Funding. The cost factors that generate the adequacy target include staffing positions in schools (teachers, counselors, nurses, principals, etc.). The cost factors also include three staffing positions for special education — special education teachers (141 students per position), instructional assistants and (141 students per position) and school psychologists (1,000 students per position). To set the adequacy target, the state uses average salaries for these positions and the three-year average enrollment count for the district.

6 states: KS, MI, MN, NE, WI and WY

States that use a reimbursement model for special education funding require districts to submit actual expenditures to the state which the state then reimburses for all or a percentage of actual spending. Therefore, a major decision point state leaders have in using this approach is which costs are reimbursable. For instance, some states reimburse all services that are required by the students' IEP meanwhile others may only reimburse instruction or may reimburse some of these services, such as transportation and support services at different rates. High-cost service funding is a type of cost reimbursement.

Wyoming fully reimburses local school districts for all costs necessitated by a student’s IEP. Districts are required to submit program expenditures for review by the state. The state will then reimburse 100% of the approved costs after that review. While other states reimburse 100% of their high-cost services, Wyoming is the only state that fully reimburses all special education expenditures.

36 states: AK, AL, AR, AZ, CO, CT, ID, IL, IN, KS, LA, MA, MD, ME, MI, MN, MO, MT, NC, ND, NE, NH, NJ, NV, NY, OH, OK, OR, PA, RI, SD, VA, VT, WA, WI and WV

Through this approach, the state reimburses districts to offset the cost of educating students with high support costs. For instance, students may be placed out-of-district or in a private school by their IEP team. Private school placement is an option when a public school cannot provide an appropriate education for a student with special needs. Students may also be placed in residential or institutional care where students receive 24-hour care or receive care and instruction in the student’s home. The costs for these placements can be significantly higher than costs for students in general education classrooms and can reach as high as $100,000 annually per student.

Under this funding mechanism, districts are responsible for the cost of special education services up to a certain threshold. If costs exceed that threshold, that state would then provide additional funding through reimbursement to the district. The threshold may be set as a dollar amount or relative to average cost per student.

Wisconsin provides High-Cost Special Education Aid to school districts for students with an IEP who have non-administrative special education costs more than $30,000. School districts apply to the state for reimbursement for eligible costs, which include salaries and benefits of licensed staff who provide support or instruction, supplies, transportation and out-of-district placement costs. The state reimburses 90% of eligible costs for high-cost services.