Answer: Prior to 1994, K-12 public schools in Michigan were largely funded through a local property tax millage. The local millage funded both operations and infrastructure of the district. Proposal A, adopted by the voters of Michigan, went into effect for the 1994-95 school year and dramatically changed the way that schools are funded. While Proposal A provided homeowners significant property tax relief, for schools it was a new funding mechanism that distributes state funds on a per pupil basis to each school district. This per pupil payment from the state is commonly called the school's foundation allowance.

Under Proposal A, school districts must still raise local revenue for building projects via bonds or sinking funds, but these are the only options currently available for individual districts to raise money. Public schools are now mostly funded through the combination of a statewide 6-mil tax, the State Education Tax (SET), an 18-mil local tax on non-homestead property (businesses), and other state collected taxes including the state income tax and sales tax. An approximate breakdown for the source of public school funding is 42% from the state sales tax, 19% from the state income tax, 16% from the SET, and the remainder from other sources including the state lottery. Surprising to some, proceeds from the state lottery fund only a small percentage of the K-12 budget (approximately 6%).

The foundation allowance for each student comprises about 90% of most school districts' general fund revenues. The remainder comes from other state or federal programs plus local revenue from interest earned, tuition, and fund transfers. Funds from state and federal programs are often designated as categoricals, meaning that they are designated for a particular category of expenditure (e.g. at-risk students, Title I, districts with declining enrollment, etc.).

Proposal A also included provisions that categorized local districts as being either below average, average, or above average with respect to per pupil spending before the implementation of Proposal A. The Grosse Ile schools were one of 48 districts designated as a "Tier 3," "out of formula," or "rich" district. This designation meant that the school district could increase the per pupil foundation allowance through a local tax levy. This component of the foundation allowance is referred to as the local Hold Harmless provision or the Hold Harmless as it relates to Proposal A and has amounted to approximately $585/student annually for Grosse Ile.

Another "hold harmless" provision was added to Proposal A by the legislature in the fiscal year 1999-2000. These funds are often referred to as "20j" or "State Hold Harmless" monies and represented, at the time, an effort to limit the amount of increase in the state foundation allowance of "rich" districts to a 1.6% inflationary increase when districts with smaller foundation grants received larger increases. Currently, Grosse Ile receives approximately $280/student in 20j funds.

Finally, another factor that deserves explanation is the Headlee Amendment to the state constitution. This amendment limits the increase in the amount of money that a unit of government (i.e. school district) can raise annually to no more than the rate of inflation. The effect on school funding is that when a school district levies the 18-mils on non-homestead property, and property values go up faster than the rate of inflation, there must be a millage reduction so that revenue doesn't grow at a rate greater than inflation. If the reduction reduces the non-homestead millage below 18 mills, this would result in a reduction of the district's foundation grant because the state requires districts to levy the full 18-mills in order to receive the full foundation grant. The result is that after such a millage rollback, school districts must return to the voters seeking to return the millage to 18-mils.

Grosse Ile Township Schools

Board of Education FAQs

Question 1: When and where are the Board of Education meetings held?

Question 2: Do Board of Education members receive any stipend, salary or benefits?

Question 3: Are all Board of Education meetings open to the public?

Question 4: What does the Board of Education do?

Question 5: What should I do if I have a complaint about a teacher, coach, building principal or any school district employee?

Question 6: How are Grosse Ile schools funded?

Question 7: What is the school district's Fund Balance or Fund Equity?

Question 8: In addition to being student-centered, what guiding principles do the Board of Education rely upon?