Youngkin’s $201 Million School Funding Error Still Isn’t Fully Fixed

The legislature’s stopgap budget provided just $16.8 million toward fixing the $201 million problem. 

There’s new information emerging about the patch in the Virginia Department of Education’s (VDOE) $201 million funding error. 

A key calculation mistake in the Youngkin administration’s education budget centered around a tool provided on the VDOE’s website, which allows schools to estimate state funding for their districts.The tool included a calculation error that did not account for the 2023 decrease in sales tax revenue, due to a cut in the state’s grocery tax.

Compounding the issue, the mistake was included in both the June 2022 budget and the one Gov. Glenn Youngkin proposed in December. According to Charles Pyle, VDOE communications director, it wasn’t until late January that the VDOE learned of the calculation mistake, although reports indicate that the error was discovered last December.

“In terms of how it occurred, the state funding formula is quite complex and occurs in an accounting system that they have access to that other people don’t have access to,” said Laura Goren, The Commonwealth Institute for Fiscal Analysis (TCI) research director. “So it’s not like other people have access to the backend to see what’s happening.”

Virginia legislators scrambled to patch the mistake in February and agreed to appropriate nearly $133 million for the current school year and more than $125 million for the next year. 

However, it appears that, while the plug stopped the leak, it fell short of fixing the problem. 

Goren explained that the stopgap budget actually provided just $16.8 million toward fixing the $201 million problem. 

“Basically what they did in that stopgap budget was they counted all the technical updates that school divisions would have gotten anyway due to increasing enrollment and changed sales tax estimates and said that counts toward fixing this problem—but that only counts toward fixing it compared to what they were told in June they’d get. It doesn’t bring them up to what they were told in December they’d get,” Goren said. “And also, the technical updates would’ve happened either way.” 

Goren noted that the stopgap budget wasn’t enough to ensure that school divisions would get the amount of money that they were led to believe they could expect back in December. 

So what can the state do to fix the problem? It all comes down to the budget amendments, which are currently being debated by the legislature.

The Democratic-majority Virginia Senate proposed a budget that would fully compensate for the $58 million error for this year. The budget also provided significant flexible funds for school divisions for the upcoming school year.

“So together, what was included in the Senate budget would make sure our schools have the resources that they have been counting on,” Goren said. 

As part of a longer statement, Virginia Education Association President James Fedderman noted key issues with the way Republican legislative leaders were handling the error.

“By using money that would have gone to schools anyway and deceptively changing the goalposts, Republicans have sought to mislead the public into believing they have made schools whole for the $201 million mistake,” Fedderman said. “Only the Democrat-proposed Senate budget offered a complete fix to this careless mistake, and we need lawmakers to come back to the table and fully fund our schools.”

Until the budget amendments are agreed upon by members of both legislative chambers, the fate of Virginia’s education funding remains unresolved. 

“We certainly look forward to legislators coming together and adopting some of the additional improvements in the Senate budget to make sure that students have the resources that they need to survive.”