State funds play a vital role in the delivery of high-quality public education across the continuum, and this reality is reflected in governors’ budgets for the next fiscal year (or for the next two years in biennial states). After rapid growth in state revenues and record budget surpluses in recent years, states are in a strong fiscal position to invest in key priorities, even amidst some signs of an economic slowdown. At the same time, states – like many sectors of the economy – are facing significant challenges due to workforce shortages. This combination of available resources and unmet labor needs has no doubt contributed to governors’ proposed budgets for fiscal 2024 calling for, in many cases, record levels of investment in education, including funds to support ongoing commitments and one-time targeted spending.
This blog highlights some of the more common education-related spending items in governors’ budgets for fiscal 2024, based on summaries of budget proposals prepared by NASBO staff. Governors' budget initiatives for education cover a range of areas including preschool and childcare; K-12 funding formula increases; teacher pay, recruitment, and retention; academic instruction; special education; student mental health; operating and capital support for higher education institutions; student financial aid; workforce development and more.
Note: Where state examples are cited, these are meant to be illustrative but by no means exhaustive.
Early Childhood Education
Childcare is a cross-cutting policy area – fulfilling a human service need (particularly for low-income families), supporting the workforce by allowing parents to participate in the labor market, and serving a role in early learning. NASBO’s budget summaries highlighted numerous initiatives proposed by governors that focus on boosting childcare worker salaries and provider rates; creating or expanding childcare subsidies, scholarship programs, and tax credits; and adding more childcare slots. For example: Missouri’s governor included funding to increase subsidy rates for childcare providers; Minnesota’s governor proposed actions to lower childcare costs for middle-class families; and New York’s governor put forward a plan to increase the state’s investment in the childcare system to $7.6 billion over four years.
Numerous states continue their efforts to improve access to preschool by expanding eligibility and increasing funding. Similar to childcare, there are also proposals specifically aimed at increasing preschool teacher salaries, such as Georgia’s governor recommending funds to increase certified preschool teacher and assistant teacher salaries. In addition to preschool, California’s governor included funds for a second year of expanding transitional kindergarten, while Utah’s governor called for funding to expand access to optional full-day kindergarten.
Elementary & Secondary Education
Formula Funding Increases & Reforms
Calls for increasing elementary and secondary (K-12) education funding distributed through states’ base or “foundation” funding formulas were widespread in governors’ fiscal 2024 budgets. In addition to funding changes tied to enrollment growth, governors in states such as Colorado and Nebraska called for increases in per pupil funding levels. Some governors also proposed plans in their budgets to adjust their states’ funding formulas, such as by providing additional resources for English language (EL) learners and economically disadvantaged students. For example, Rhode Island’s governor proposed modifying its formula to help school districts navigate enrollment shifts and prevent state funding declines, as well as providing additional funds for multilingual learner funding, economically disadvantaged students, and other target populations. Meanwhile, the Tennessee governor’s budget provided a $350 million increase for the state’s new public education funding formula that was signed into law last year.
Teacher Pay, Recruitment & Retention
Another area where governors called for significant new investment is in teacher compensation, along with more targeted recruitment and retention efforts for teachers and other educational staff. States play varying roles in setting teacher pay levels. Most states indirectly influence teacher pay through the amount of funding they distribute to local school districts, leaving compensation decisions to be made at the local level. However, according to a recent report from the National Center on Teacher Quality (NCTQ), 13 states establish teacher salary schedules and nine states set a minimum teacher salary level. This variation is reflected in the differing nature of teacher pay proposals presented in governors’ budgets. Governors in Oklahoma, South Carolina and West Virginia, for example, each put forth recommendations to directly increase teacher pay rates in their budgets; these states are among the 13 states that set teacher salary schedules according to NCTQ’s report. Governors in other states allocated funds to school districts they can use towards increasing teacher compensation, in some cases requiring a portion of new funds to be used for teacher pay.
With teacher shortages continuing to cause significant challenges for states and local school districts, governors also proposed funds for targeted strategies to improve teacher recruitment and retention. To increase the educator pipeline, Illinois’s governor proposed a three-year pilot program funded at $70 million annually while Ohio’s governor proposed a new Teacher Apprenticeship program. Louisiana’s governor directed more funds to hire staff to support an increased volume of teacher certification application reviews and renewals. For recruitment and retention, Maryland’s governor proposed new recruitment incentives to address chronic staffing shortages as well as retention bonuses for education support personnel.
Governors continue to prioritize literacy programming using various funding strategies. Oregon’s governor proposed $100 million for evidence-based, targeted literacy programs, as well as $20 million for summer programs focused on literacy (with districts required to provide a 50 percent local match). In Indiana, the governor established a $20 million incentive program to improve reading scores.
Also evident in governors’ budgets for fiscal 2024 is a continued emphasis on enhancing math and computer science education. For example, Mississippi’s governor recommended spending on computer science initiatives, while Virginia’s governor proposed funds to support math specialists in grades K-8.
Governors’ budgets also put additional funding towards tutoring and other out-of-school programming. For example, New Mexico’s governor proposed $50 million for before- and after-school as well as summer programs, while New Jersey’s governor recommended $30 million in federal funds for high-impact tutoring and related programs to address learning loss during the pandemic.
A number of governors proposed specific budget initiatives related to special education. For example, Wisconsin’s governor recommended a $1 billion increase in special education aid in the next biennium, while Nebraska’s governor proposed a new $1 billion Education Future Fund to provide investments for K-12 special education, with the fund replenished annually with a $250 million transfer from the General Fund.
Student Mental Health
Another area of continued focus in governors’ budgets is student mental health. Washington’s governor proposed $314 million over the next biennium to increase school nurses, social workers, counselors, and psychologists. In Michigan, the governor recommended $300 million in funding for K-12 student mental health programs.
Other K-12 Initiatives
Governors’ budgets for K-12 education also proposed new investments such as expanding school choice programs, providing universal free school meals, enhancing civics education, and offering more dual enrollment and career and technical education opportunities. Additionally, largely one-time capital investments were proposed by states to support school construction, safety improvements, technology upgrades, and school bus replacements.
Operating Support & Restricting Tuition
Governors in many states highlighted proposals to increase operating support for postsecondary education institutions, including state universities and community colleges. In some cases, these proposed funding increases were tied to freezing tuition or restricting tuition growth. For example, in South Carolina the governor recommended additional funds to mitigate a proposed tuition freeze for in-state students at public institutions, while in Massachusetts, the governor proposed a new reserve account to fund a four-year tuition and mandatory fee lock.
In addition to restricting tuition, governors’ budgets also prioritized college affordability through recommended investments in financial aid programs. Arizona’s governor proposed $40 million to expand its Promise Program as well as another $40 million to establish a new tuition scholarship program, while Idaho’s governor recommended $80 million to expand its state scholarship program.
Governors’ higher education proposals also prioritized connections to workforce development, particularly in the current economic environment marked by widespread labor shortages. For example, Massachusetts’s governor proposed a new initiative to provide free community college to adult students pursuing training in high-demand fields, while in New Hampshire, the governor proposed money for new student loan repayment assistance for recent graduates pursuing high-demand careers.
Governors’ budgets also recommended additional funds for higher education capital projects. Kansas’s governor recommended state funding to be matched by universities for its Capital Renewal initiative, while Delaware’s governor proposed funds for deferred maintenance, capital improvements, and technology upgrades at public higher education institutions.
In addition, governors’ budgets recommended targeted higher education investments in areas including career and technical education, community colleges in rural areas, and student mental health. Some governors also proposed state matching funds to incentivize institutions to foster more private giving, as well as funds for other efforts to improve collaboration across the higher education system and increase graduation rates.
Concluding Thoughts and Further Reading
As is clear from reviewing governors’ budgets for fiscal 2024, the chief executives of state governments across the country are focused on using available resources to preserve and further enhance access to high-quality education from early childhood through the postsecondary level and beyond. Their spending recommendations include a diverse range of strategic investments, both ongoing and one-time. Governors’ budget proposals are subject to the legislative appropriations process, so not all recommendations will necessarily be enacted. However, given the continued health of state finances, similar levels of investment in education overall can be expected in adopted budgets as compared to governors’ proposals.
In addition to governors’ budget summaries, NASBO staff also produced high-level summaries of governors’ state of the state speeches, highlighting their priorities in education and a host of other policy areas. For further reading on governors’ current education priorities, as outlined in their state of the state addresses be sure to also check out this recent report by the Education Commission of the States in collaboration with the National Governors Association.