INFORMATIONAL

Governor Gilmore presented his 2000-2002 biennial budget to a joint meeting of the 
Senate Finance Committee, the House Appropriations Committee, and the House Finance 
Committee on December 17, 1999.  This budget will be considered by the 2000 Session 
of the General Assembly, which is scheduled to convene on January 12, 2000.

The Governor's recommendations include full funding for the state's share of the 
Standards of Quality (SOQ), continuation of all existing programs, and additional 
funding for several new initiatives.  Attachment A provides detailed descriptions of 
the funding proposed by the Governor.  In summary, the proposed budget includes funds 
to achieve the following objectives:

· expand the Early Reading Intervention program to include grades kindergarten through 3;
· provide a new program for math remediation in grades 7 and 8;
· distribute Literary Fund revenues for technology grants;
· develop and field test additional SOL test questions;
· provide electronic copies of SOL test results;
· provide item analysis of SOL test results;
· pilot the new alternative route to teacher licensure;
· provide mentor teachers for individuals who enter the teaching profession through 
  the alternative route to licensure;
· provide special education services in local jails; and,
· provide academic review teams for schools that are accredited with a warning.

Also attached is a printout that reflects the estimated entitlements from the major 
SOQ and related accounts that your locality will receive in fiscal year 2001, which 
begins July 1, 2000, and ends June 30, 2001 and fiscal year 2002, which begins July 1, 
2001, and ends June 30, 2002.

This printout does not include the categorical programs that are funded on a reimbursement 
basis.  Likewise, it does not include the direct grants unique to certain school divisions, 
which are authorized by the General Assembly.  The Governor's budget includes continued 
funding for these programs, but estimates of the distributions by school division have 
not been computed at this time.  The categorical accounts will be included in the 
entitlement tables at the conclusion of the General Assembly session.  For planning 
purposes, you should continue to use the amounts provided to you for fiscal year 2000 
in Regulatory Superintendent's Memo. No. 1, dated March 3, 1999.  These accounts are 
categorized as Group III accounts.

It is important to remember that this information relates to the Governor's budget as 
introduced.  It is subject to change as the House of Delegates and the Senate prepare 
amendments to the Governor's budget.  A final budget will be adopted by the General 
Assembly in mid-March 2000.  Therefore, the estimated entitlements contained in this 
memorandum are only projections and are subject to change throughout the session.  We 
will provide additional information during the process as changes occur.

If you have questions, please contact Dan Timberlake, assistant superintendent for 
finance, or the Budget Office staff at (804) 225-2025.


JLD/kmr:pft
Attachments:	A hard copy of this memo and its attachment
			will be sent to the superintendent's office.
s:\budget\2000-2002 budget\governor's introduced budget supts memo no 226.doc

 
									

Details of Governor Gilmore's Introduced Budget
for 2000-2002


Existing Programs

· Update SOQ and Related Accounts -- The Governor's budget includes $245.3 million 
  in fiscal year 2001 and $301.9 million in fiscal year 2002 to fully fund the state's 
  share of the Standards of Quality programs.  The data elements used to develop the 
  SOQ budget were updated using the most recently verified data and are provided on 
  Attachments B and C. 

The budget also includes an additional $12.8 million in fiscal year 2001 and $17.0 
million in fiscal year 2002 to fully fund existing incentive-based programs and 
required categorical programs.  Projected entitlements for the incentive-based accounts 
are included on the attached entitlement distribution sheet.

· Update ADM, Sales Tax, School Age Census, and Composite Index --The proposed budget 
  reflects funding necessary to cover increases/decreases in projections of March 31, 
  2001, and March 31, 2002, Average Daily Membership (ADM).  The projected ADM was 
  forecast by the Department of Education based on September 30, 1999, Fall Membership. 
  On a statewide basis, these projections are lower than those used to develop the Board 
  of Education's proposed budget that was adopted in July 1999. In addition, all other 
  accounts that use Fall Membership data in their calculations have been updated based 
  on the September 30, 1999, totals.  

The estimated entitlements also reflect the most recent one-cent sales tax estimates, 
as computed by the Department of Taxation.  The Department of Taxation projects revenues 
of $783.8 million in fiscal year 2001 and $834.6 million in fiscal year 2002.  The 
data that was reported in the 1999 School Age Census was used to distribute the sales 
tax.  The projected entitlements were calculated using the 2000-02 composite indices 
provided via Informational Superintendent's. Memo. No. 213, dated November 23, 1999.

· Change Use of Lottery Proceeds -- Funding for the distribution of lottery proceeds 
  will continue in the 2000-2002 biennium at relatively the same levels provided in 
  fiscal year 2000.  Governor Gilmore has recommended eliminating the requirement that 
  50 percent of these revenues must be used for school construction, additions, 
  infrastructure, site acquisition, renovations, technology, expenditures related to 
  modernizing classroom equipment, or debt service payments.  This change means that 
  100 percent of the lottery revenues may be used for any educational purpose.  All 
  other provisions related to the lottery revenues continue in the 2000-2002 biennium.  
  The base year for the maintenance of effort requirement has been updated to fiscal 
  year 1998.

· Reduce Student to Teacher Ratio -- Legislation passed by the 1999 General Assembly 
  reduced the division-wide student to teacher ratio to 24 to 1 in kindergarten through 
  grade 3.  As a result, basic aid per pupil amounts increased and the 24 to 1 tier 
  of the Primary Class Size Reduction Program was eliminated.  


New Education Funding Initiatives

Governor Gilmore included funding for several new initiatives in his budget.  Except 
as otherwise noted, the funding amounts represent biennial totals.

· Web-based Computerized System -- $101.3 million ($95.0 million for school divisions) 
  to establish a computer-based instructional and testing system to support the 
  Standards of Learning.  This program will provide funding for high schools to improve 
  their instructional, remedial, and testing capabilities.  The program will provide 
  funding to reach a goal of one computer for every five students in high school and 
  internet access for all high schools.  Funding is also provided for instructional, 
  remedial, and testing software and license fees and also for training.  The majority 
  of the funding ($84.7 million) will be provided from the Literary Fund.  Approximately 
  70 percent of the Literary Fund grants will be distributed on a per school basis for 
  eligible high schools.  Eligibility will be based on whether or not the school has 
  met the stated goals of the program.  The remaining 30 percent will be distributed 
  on a per pupil basis for all students reported in grades 9 through 12 without regard 
  to the eligibility of the affected school.

In order to receive this funding, divisions will have to certify that they intend to 
administer computerized SOL tests by May 1, 2003.  School divisions must also commit 
to reviewing any purchased software applications and report the results to the Department 
of Education so that this information can be shared with the Best Practice Centers and 
high schools across the state.  

The initiative also includes funding from the General Fund, which will be distributed 
among localities on a per pupil basis.  The General Fund distributions will help pay 
for recurring costs such as T1 line charges, on-site support, and training.  In order 
to receive the General Fund portion of the funding, localities must provide a match 
based on the composite index of local ability-to-pay.  The Literary Fund portion of 
the distribution does not require any local matching funds.

· Expand the Early Reading Intervention Program -- $17.1 million ($15.5 million for 
  school divisions) to expand the existing Early Reading Intervention Program to 
  include all grades kindergarten through three. The goal of this program is to 
  improve student performance on all of the third grade SOL assessments and to help 
  all students read on grade level by the third grade.  The funding methodology 
  remains similar to that of the existing program, which is based on 2.5 hours of 
  additional instruction per week at a ratio of one teacher for five students for an 
  estimated number of eligible students.  Currently, the percent of students eligible 
  for the federal free lunch program is used to estimate the number of students eligible 
  for this program. In the first year, this proposal funds services for:

1) 100% of the estimated students eligible in kindergarten;
2) 50% of the estimated students eligible in grade one;
3) 50% of the estimated students eligible in grade two; and
4) 25% of the estimated students eligible in grade three.

In the second year of the biennium, funding will be based on the actual number of students 
needing services as identified by a diagnostic test. School divisions that elect to 
participate in this program will be required to fund a local match based on the composite 
index of local ability-to-pay.

· Math Intervention Program -- $9.8 million ($9.1 million for school divisions) in 
  fiscal year 2002 to fund a program for seventh and eighth grade students who require 
  remediation in order to pass the eighth grade math SOL assessment.  The program will 
  provide additional instruction to students who are identified with deficient math 
  skills via local or state-provided tests.  The program provides funding for 2.5 hours 
  of additional instruction per week for an estimated number of students based on a 
  student-to-teacher ratio of ten to one.  The number of students eligible will be 
  estimated based on the percent of students failing the eighth grade math SOL test.  
  Localities receiving these incentive funds will be required to provide a match based 
  on the composite index of local ability-to-pay.

· Mentor Teacher Program/Alternative Licensure Program -- $809,797 ($400,000 for 
  school divisions) to expand the current mentor teacher program and to train 
  professionals who are not currently certified to teach in public schools.  These 
  programs will help address the teacher shortage in math, science, and technology 
  fields by allowing divisions to hire nontraditional classroom instructors and to 
  support such individuals through mentor relationships with veteran teachers.  The 
  program assumes that 100 new teachers will be hired and provides $1,000 for training 
  and materials for each new teacher and a $1,000 stipend for each veteran teacher who 
  serves as a mentor.

· Funding for Incarcerated Special Education Students --  $3.4 million to provide 
  special education services to students housed in regional and local jails, as 
  required by the federal Individuals with Disability in Education Act (IDEA) regulations. 
  The state will pay 100 percent of the cost for these programs.