FY 2024 Excess Cost Funding Shortfall and Impact to Reimbursements

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 are estimated to be significantly higher than anticipated. The cost to fully fund the reimbursement requests at their statutory reimbursement levels is about $226 million, or $45 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 68%-73%, 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.

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 in the current year, or use a carryforward of FY 2024 resources, in an amount equal to $45.1 million.