The Excess Cost grant is provided by the State to school districts to assist them in paying for special education expenses for students with extraordinary needs. Through the Excess Cost grant, local and regional school districts are eligible for partial reimbursement for the cost of educating students whose required services are greater than 4.5 times the district’s average expenditure per-student for the prior year.
During the 2023 legislative session the Connecticut General Assembly passed Public Act 23-204, which appropriated approximately $181 million for Excess Cost reimbursements in FYs 2024 and 2025. FY 2024 Excess Cost reimbursement requests were estimated to be significantly higher than anticipated. The cost to fully fund the reimbursement requests at their statutory reimbursement levels is roughly $231 million, or $50 million more than the $181 million that was appropriated for FY 2024.
Due to this significant underage, towns and districts are now being reimbursed at percentages ranging from 64%-75%, which are lower than the statutory tiers and in fact lower than the 74%-79% reimbursement tiers that existed prior to Public Act 23-204.
Because the FY 2025 Excess Cost appropriation is equal to the FY 2024 appropriation, this underfunding is projected to continue should reimbursement requests exceed the capped entitlement.
To provide all districts with stable and adequate for educating students with extraordinary needs, and to meet the statutory levels passed during the 2023 legislative session, the General Assembly should increase the Excess Cost appropriation by at least $50 million during the 2025 legislative session.
Citation
School and State Finance Project. (2024). Excess Cost Funding Shortfalls for FYs 2024 and 2025 and the Impact to Reimbursements. Hamden, CT: Author. Retrieved from https://files.schoolstatefinance.org/hubfs/Reports/
Excess%20Cost%20Funding%20Shortfalls%20for%20FYs%202024%20and%202025.pdf.