Instructional Expenses will be any districts largest expense. Instructional Expense is distinct from Support Services Expenses, which are detailed in other report pages in the Michigan Benchmark report. Two subcategories comprise Instructional Expense - Basic Instruction and Added Needs Instruction. Basic Instruction funds the General Education expenses of the district. This is primarily the cost of General Education teachers. Added Needs expense is associated with Special Education programs.

This measure is relevant for a holistic understanding of school district operation and financial decisions. While there has always been controversy of an accurate definition of economic disadvantage, since definition are constant (commonly a measure against a certain level below a poverty level), this measure is instructive to comparing (benchmarking) a consistent measure of socioeconomic status. Controversy remains (and always will) about correlation or causation of economic status and academic achievement (i.e. standardized test scores). Most would agree that serving communities with higher levels of poverty will introduce unique challenges.

This visualization contains three key and inter-related metrics. Fall Enrollment reflects the ever-important enrollment of students (in Full Time Equivalent form) which is the primary driver of Michigan schools revenue. Teacher Count measures the number of Basic Instruction teachers (meaning it does not count Added Needs / Special Education teacher levels). The Pupil to Teacher Ratio Divides the Fall Enrollment number by the Teacher Count number. The Pupil to Teacher Ratio is most definitely not the same as Average Classroom Size but rather a proxy measure of it. For Michigan school consumers, especially parents, lower ratios are generally preferred. Economically the measure is critical. As an example, if a 5,000 student district wanted to lower its student to teacher ratio from 20 to 19, assuming teachers were paid at the state average, it would cost an additionally $1 million annually to do so. Please use the Budget Modeling Utility to explore these dynamics in your own district.

The dollar amount the State of Michigan establishes for the revenue it will flow to local school districts on a per pupil basis. This amount is set every year by the state within the School Aid Bill. The Foundation Allowance represents the largest portion of revenue local districts receive from the state to fund the operations of the school district.

General Fund Equity is the excess of General Fund assets over liabilities. Commonly it is referred to as simply Fund Equity. It is not a measure solely of cash on hand or in a bank. It also includes accounts receivable and other assets. A large one is commonly money due from the state as Foundation Allowance revenue can lag. For our purposes it is simplest to view Fund Equity as a proxy measure of a district's overall financial condition. In general and within reason, the higher the value of Fund Equity the better. Since Fund Equity can also be interpreted as the aggregated Annual Operating Results of the district from its inception, it is a proxy measure of how effectively district finances have been managed. However funds issued to districts with the expectation that the district applies them to improve student services. Having an overly funded equity position can be interpreted as a misuse of funds. Fund Equity levels are also commonly reported as a percentage of annual district revenues (or expenditures) and industry associations recommend 10% to 15% as a healthy level.

Homestead Taxable Values (TV) is the sum of the Taxable Value of all the Homestead properties within a school district's boundaries. The Per Pupil visualization of Homestead Property Taxable Value divides the Total (sum of Taxable Value) by the Fall Enrollment for each year. Residential property owners in Michigan generally declare their residence (home) as their Primary residence. For those who have multiple residential properties, commonly in Michigan this might be a vacation home, the secondary residence is classified as Non-Homestead. The designation has tax implications since the "Homestead Exemption," which is allowed on a single home per household, carries a 6 mill tax rate whereas Non-Homestead properties are taxed at 18 mills. The 6 mills appear on your tax bill under the State Education Tax, which flows to the state level into the School Aid Fund, which is one of the sources of the per pupil Foundation Allowance.

The two main categories of expenses are Instructional and Support Services. Instructional and Non-Instructional Support Services are the two main subcategories of the Support Services expense category. In a somewhat confusing naming convention, Support Services has two main subcategories - Instructional Support (not to be confused with Instruction itself) and Non-Instructional Support. Both of these Support services subcategories have even more subcategories which are examined in their own respective report pages. To begin to understand the category schema, Instructional Support are expenses that are closer to the classroom - Pupil Services, Instructional Staff Services, and School (or Building) administration. Non-Instructional Support is further away from the classroom and is comprised of General Administration, Business Administration, Operations and Maintenance, Transportation, and Other Support Services.

Millage Rates are certainly important to Michigan taxpayers. Property Taxes can be levied by different taxing authorities. The Michigan Benchmark report focuses on those taxes levied by either the local school district or the country within which the school (and taxpayer) reside. What is NOT reported is the state levied 6 mill State Education Tax. Since every Michigan homestead property tax at those same 6 mills, it does not vary from a benchmark perspective. Local districts have the option to bring tax levy options for voters to decide - including Debt, Sinking Fund, and in limited cases a Hold Harmless millage. County millage options include Special Education, Vocational, Enhancement, and Allocated Millages.

Non-Instructional Support Services is one of the two major subcategories of the Support Services expense category. Non-Instructional Support services expenses, a opposed to the Instructional Support Services examined on another page, is comprised of five subcategories - General Administration, Business Administration, Operations and Maintenance, Transportation, and Other Support Services. Many of these titles are reasonably self-explanatory. General Administration contains the office of the district superintendent and limited numbers of district-wide administration, including Board of Education expenses. Business Administration encompasses expenses related to budgeting, accounting, payroll, purchasing, and internal services. Operations and Maintenance includes the people and resources who support the physical plants, buildings and grounds of the district operations. Transportation contains costs for inter-district transport - mainly bus services. Other Support Services include all those expenses other than those mentioned above which support each of the instructional and supporting service programs. It includes research, personnel, and data processing.

By dividing the number of the districts enrolled Basic Instruction student Full Time Equivalent (FTE) by the number of Basic Instruction FTE teachers we compare all districts ratio of students to teachers. This ratio is one of the most consequential financial decisions a district can make. Please use the Budget Modeling Utility to calculate the cost increase or decrease impact of adjusting this ratio up or down.

Proportional spend is fundamental to the ability to compare and contrast how different districts allocate their spending. This is because despite the State of Michigan's policy efforts (largely through 1994's Proposal A legislation) to equalize revenue per student across the state, districts still vary. Reference in this Proportional Spend Benchmark view, a Michigan Benchmark innovation, allows for more accessible data comparisons within a district (i.e. this Intra-District view) or across districts (i.e. Benchmark views). The Spend by Function highlights the four main educational service categories - Basic and Added Needs Instruction and Instructional and Non-Instructional Support. These last two collectively are known as Support Services. Any district cost not within one of these four categories is categorized in "Other Operating Expenditures."

The Headlee Amendment is a provision in the Michigan Constitution that limits the ability of local governments, including school districts, to raise taxes. It was passed in 1978 to protect taxpayers from excessive property tax increases. Here's how it works: Millage Rollbacks: If property values in a district increase faster than inflation, the millage rate (the tax rate per $1,000 of assessed property value) is automatically reduced. This is known as a "millage rollback." Limited Taxing Authority: The Headlee Amendment limits the total amount of taxes a local government can collect. If property values decline, the district's ability to raise revenue is further constrained. Impact on School Districts: School districts in Michigan rely heavily on property taxes to fund education. The Headlee Amendment can limit their ability to raise the necessary funds to maintain or improve educational programs and facilities. In summary, the Headlee Amendment can have a significant impact on Michigan public school finance by limiting the revenue that districts can generate from property taxes. This can lead to challenges in funding education adequately, especially during periods of economic decline or when property values are stagnant.

Michigan public school teacher salary schedules typically follow a step-and-lane structure. This system is designed to reward both experience and education. Steps: Represent years of experience. Teachers typically move up a step each year, leading to a salary increase. The number of steps in a schedule can vary, but it's common to have 10-15 steps. Lanes: Represent levels of education and additional certifications. Teachers can move up a lane by earning additional degrees or certifications, which also results in a salary increase. Common lanes include Bachelor's Degree, Master's Degree, and Doctorate. Example: A teacher with a Bachelor's degree starting at Step 1 in Year 1 would have a base salary. As they gain experience and move up the steps, their salary increases. If they earn a Master's degree, they would move up a lane, receiving an additional salary boost. Key Points: Salary Schedules: Each school district in Michigan has its own unique salary schedule, so specific details can vary. Collective Bargaining: Teacher unions often negotiate salary schedules as part of collective bargaining agreements. Additional Compensation: Some districts offer additional compensation for specific roles (e.g., department head, coach) or for extra duties (e.g., advising clubs, tutoring). This step-and-lane structure provides a clear framework for salary advancement based on both experience and education, ensuring that teachers are rewarded for their professional development and contributions to student learning.