K-12 funding formula study, education wallet pilot clear NC Senate committee

A new bill that would launch a formal study of overhauling how the state funds K-12 schools unanimously cleared the North Carolina Senate Education committee on May 13. The legislation would also create a pilot program letting high schoolers spend state money on outside-the-classroom learning.

Senate Bill 990, the Students First Act, is meant to inject transparency into education funding and innovation into how students access enrichment, according to primary sponsor state Sen. Michael Lee, R-New Hanover.

The most significant change in the bill would establish a weighted student funding formula working group at the Office of Learning Research, housed within the UNC-affiliated North Carolina Collaboratory. The group would develop a three-year strategy to transition North Carolina from its current resource-allocation funding model to a per-pupil weighted formula. A report would be due to the Joint Legislative Education Oversight Committee by July 15, 2027.

“A weighted student formula is incredibly important. We need to move forward with it,” Lee told the committee. “We’re one of just a few states with a resource-based allocation method. And no matter where you are in this state, the transparency, the accountability, and the ability to properly fund education is going to be determined by a weighted student formula.”

Robert Luebke, director of the Center for Effective Education at the John Locke Foundation, said SB 990 addresses long-standing problems in how the state funds K-12. “The current system is too complex, lacks accountability, and it’s hard to assess if money is getting to where it’s needed,” Luebke said. “A weighted student funding formula would tie funds to student needs and make the system more accountable and easier to understand.”

The bill also directs the work group to study whether to transfer responsibility for disbursing K-12 funds from the Department of Public Instruction to the State Education Assistance Authority (SEAA), which currently administers the state’s college aid programs and Opportunity Scholarship vouchers.

That provision drew the most pushback from Democrats. State Sen. Sophia Chitlik, D-Durham, questioned whether transferring K-12 funding authority to SEAA runs afoul of the state constitution, which empowers the State Board of Education to supervise and administer public schools.

“I don’t know why we would spend funds to then create a series of recommendations that might not be constitutional,” Chitlik told the committee.

State Sen. Amy Galey, R-Alamance, a co-primary sponsor of the bill, defended the constitutionality of the provision.

“Having another entity as a pass-through doesn’t infringe on that,” Galey said. “But it goes on to say ‘subject to laws enacted by the General Assembly.’ So it’s very clear in the constitution that the General Assembly ultimately controls the flow of the money through the public school system.”

The bill also creates a Student-Based Education Wallet pilot program. SEAA would select one high school to participate, with eligible students receiving up to $395 per year for credit-bearing or enrichment activities — Career and Technical Education programs, arts, athletics, or STEM competitions — offered by approved outside providers.

Lee described the pilot as growing out of the Rowan-Salisbury renewal school district’s experience filling a teaching gap.

“They were having a hard time finding a PE teacher, so they brought in a local karate school, and kids signed up, and that ended up being their PE credit,” Lee said. “The school board approved it. The superintendent approved it. It helped a private business. It helped the school district meet a need.”

A third major provision in the bill, titled the Protect Campus Survivor’s Act, would amend state public records law to make student disciplinary records at the UNC System Office, individual UNC constituent institutions, the Community Colleges System Office, and individual community colleges confidential — even where federal law would permit disclosure. 

The exemption applies to records that contain personally identifiable information about a student and relate to a complaint, investigation, or resolution of an alleged violation of campus disciplinary or conduct rules.

The provision would effectively override a 2020 North Carolina Supreme Court ruling in DTH Media Corp. v. Folt that required UNC-Chapel Hill to release certain records of campus sexual misconduct findings to the Daily Tar Heel. The exemption takes effect when the bill becomes law and applies to all public records requests submitted on or after that date — meaning records of past disciplinary cases would not be releasable under future requests.

SB 990 is the second major public records exemption to advance through the General Assembly this session, following Senate Bill 229, which would retroactively shield name, image, and likeness contracts between college athletes and third parties from public records law.

The bill now heads to the Senate Appropriations Committee on Base Budget.

“K-12 funding formula study, education wallet pilot clear NC Senate committee” was originally published on www.carolinajournal.com.