Lansing, Michigan, September 23, 2025
News Summary
A recent report from Michigan State University’s Education Policy Innovation Collaborative highlights the urgent need for more funding for schools across Michigan. As state leaders negotiate the 2025-26 budget, the report emphasizes the implications of persistent funding issues and suggests policy recommendations, including potential tax hikes to increase school budgets. It raises concerns over how well past funding has translated to improved educational outcomes in the state.
Lansing, Michigan – A report from the Education Policy Innovation Collaborative at Michigan State University has highlighted the need for increased funding for schools across Michigan. This call for additional funding comes as state leaders are in heated discussions regarding school funding for the 2025-26 budget year, which has a negotiation deadline set for September 30. If an agreement is not reached, non-essential state services could face a shutdown.
The findings of the report do not specify the exact amount of additional funds required or how these resources should specifically be allocated. However, raising taxes has been suggested as a possible method to enhance school funding, although this approach may encounter political hurdles in Lansing.
Current proposed school budgets by the House, Senate, and Governor Gretchen Whitmer are relatively similar, ranging between $21 billion and $22 billion. Nonetheless, the differences lie in how these budgets are allocated across various educational needs. Over the years, increased funding and staffing have not led to significant improvements in Michigan’s performance on the National Assessment of Educational Progress, known as the Nation’s Report Card. Despite the state experiencing an inflation-adjusted funding increase of $2.1 billion since 2015, Michigan’s funding per pupil remains below its highs reached in the early 2000s.
Currently, there is a petition being circulated that aims to increase school funding by $1.5 billion annually. This increase would be funded through tax hikes on individuals earning $500,000 and couples making $1 million or more. The report emphasizes that past funding levels have not translated into improved educational outcomes, raising concerns about how much money is reaching classrooms directly. Nearly one-third of school payroll costs are currently consumed by mandatory retirement obligations, contrasting sharply with the national average of less than 20%.
The report by EPIC does propose several policy recommendations to optimize school funding. These include ensuring that funding directed toward special populations and services is adjusted for inflation, enabling districts to spread categorical funding over multiple years for effective long-term planning, and allowing districts to pursue additional funds through voter-approved operating millages. While there are suggestions to raise state income tax or property tax, these proposals may meet political resistance considering Michigan had the fifth-lowest tax burden among states as of 2022.
Furthermore, the evolving student population in Michigan necessitates increased educational costs, compelling the need for alignment of main revenue streams with inflation. The report discusses the potential for better leveraging K-12 resources to secure necessary funding. Ideas such as the consolidation of small school districts could save costs; however, this approach may present substantial public support and logistical challenges.
The implications of the report are critical as they underline a persistent issue in educational funding, arguing for a carefully considered approach to budgeting that not only anticipates rising costs due to inflation but also addresses the needs of a growing and diversifying student population.
FAQ Section
What does the Michigan State University report suggest?
The report suggests Michigan should allocate more funding to its schools.
What is the deadline for the budget negotiation?
The budget negotiation deadline is set for September 30.
How much funding do the proposed school budgets range between?
The proposed school budgets range between $21 billion and $22 billion.
What is the amount proposed to increase school funding through tax hikes?
The amount proposed to increase school funding is $1.5 billion annually.
What has been the historical context of funding since 2015?
Funding has risen by an inflation-adjusted $2.1 billion since 2015, making Michigan rank ninth-highest in funding increases among states.
What challenges face the proposed tax increases for funding?
Raising state income tax or property tax may face political resistance.
What is the paper’s find about the impact of increased funding on educational outcomes?
Increased funding and staffing in recent years have not significantly improved Michigan’s performance on the National Assessment of Educational Progress.
Key Features of Michigan School Funding Report
| Feature | Details |
|---|---|
| Current Funding Range | $21 billion – $22 billion |
| Proposed Increase | $1.5 billion annually through tax hikes |
| Funding Increase Since 2015 | Inflation-adjusted $2.1 billion |
| National Performance | No significant improvement |
| Tax Burden Rank Among States | Fifth-lowest |
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Additional Resources
- Iron Mountain Daily News: MSU Study Urges More Money & Efficiencies for Michigan Schools
- Michigan Advance: MSU Study Floats New Taxes to Fund Schools
- Bridge Michigan: MSU Report Urges More Money & Improved Efficiencies for Michigan Schools
- Detroit Free Press: Michigan School District Budgets & Federal Money Withheld
- Wikipedia: Education in Michigan
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