State Aid to K-12 Schools Down Slightly

State aid to Nebraska’s 244 school districts will amount to $1.047 billion for school year 2021-22, $6 million less compared to the 2020-21 school year. Tax Equity and Educational Opportunities Support Act (TEEOSA) aid includes equalization aid, allocated income tax rebate, option funding, and other forms of aid, but does not include dollars distributed for special education or the property tax credit program.

State aid in 2021-22 marks the second consecutive year TEEOSA aid has declined. Last year it was off $13 million. Rising property values, particularly in urban areas, is the most likely culprit for the drop in aid. Rising property values increases the property tax capacity of school districts, reducing the need for state aid.

Omaha and Lincoln Public Schools are the largest beneficiaries of state aid receiving $260 million and $117 million respectively. Omaha’s state aid is $14 million less compared to last year while Lincoln’s is $2 million more. Together, the two schools account for 37 percent of total TEEOSA aid and approximately 29 percent of the state’s students. McPherson County and Loup County Schools will receive the least amount of aid, $5,462 and $6,617 respectively.

Figure 2 plots the cumulative share of TEEOSA aid across all schools, starting on the left with Omaha, the largest recipient, and ending with McPherson County on the right, the smallest recipient. The top 25 schools in terms of TEEOSA aid received, account for nearly 85 percent of the total aid distributed. In fact, the top four schools (Omaha, Lincoln, Millard, and Grand Island) receive just under 50 percent of the total aid distributed. Or, looking at it another way, taken together 206 schools receive just 10 percent of total state aid distributed. For more information on the amount of TEEOSA aid individual school districts will receive in 2021-22 compared to 2020-21, go to: https://cdn.education.ne.gov/wp-content/uploads/2021/05/2122SA_Paid_to_Paid.pdf