CT Special Education funding system “broken,” experts tell I-Team 

HARTFORD, Conn. (WFSB) - The I-Team is taking a look at special education funding, and why some experts say the system is broken.

FINN’S STORY:

Finn Daly is unstoppable, taking on the world one day at a time.

“He loves to play basketball, he’s very social, he loves to be with his friends, he loves going to school everyday,” says his mom Brooke. Just when it comes to school, sometimes the 12 year old, who has down syndrome and autism, needs a little help. “It’s hard for him to focus, and he learns differently and he also doesn’t understand danger like a typical 12 year old would. So he has a paraprofessional who is with him all day. He receives occupational therapy, physical therapy, speech therapy and those are really all critical to his development.”

EXCESS COSTS:

Finn receives all his services through the West Hartford School District, within the district. But some students in Connecticut have extraordinary needs that districts can’t provide themselves, resulting in students being sent out of district to specialized programs instead.

“Sometimes they’re mental health services. A lot of times they’re physical, where students who have real intensity of service needs that are medical in nature, that require special equipment, that might require nursing services,” says Kate Dias, president of the Connecticut Education Association, the state’s largest teacher union.

In Connecticut, the district that student lives in, is still responsible for paying for those services. That money for out of district services, is referred to as “excess costs.”

“A student with a high level of needs could easily get to $100,000 when you start talking about the specialists we need to bring in, medical devices, any of those sorts of layers that we bring in,” says Dias.

To reimburse school districts for these costs, the state has an Excess Cost Grant Program. But we’re told, it’s not as simple as it sounds.

“When you look at the local municipalities, they’re not even eligible for excess costs until it’s like 4 times the average student,” says Dias.

It’s actually 4.5 times the average student, according to CTDOE. What does that mean? Say, for example, a school district spends an average of $20,000 per student, it would not be able to start collecting reimbursement until it spent at least $90,000 on the student receiving out of district services.

Districts also don’t typically receive full reimbursement, because special education costs are rising but the state grant program has been short funded over the years. Depending on several factors, reimbursements can range from 55% to 80%. Recently, they have ranged from 70 to 75%.

“The debate that we are kind of engaged with is, what are the boundaries around those excess costs and who should assume them,” says Dias.

The state appropriated approximately $181 million for excess cost reimbursements for 2024-25, then provided an additional $40 million to the grant program in March. But the I-Team found districts submitted $300 million dollars in expenses for that same time period, according to the School and State Finance Project, leaving $78 million dollars for schools to come up with.

“We have a legal obligation to provide education for every single eligible child in the State of CT,” says Dias. It’s kind of like any other significant cost situation. We’ve got to figure it out."

BROKEN SYSTEM?:

Patrick Gibson, with the school and state finance project - a small non-partisan non-profit studying CT public education - says the special education funding system in the state is broken.

“We think about the unpredictability of special education costs. A district doesn’t know what students are going to walk through the doors on September 1st or whenever school starts,” says Gibson. “Because costs are essentially increasing 10% year over year that means that every year districts are facing increased excess costs and they’re not getting additional funds to cover them. That money has to come from somewhere.”

Currently, Connecticut is one of only two states that provides state funding for special education services through an excess cost grant program, where districts spend the money and then apply for reimbursement.

“As a state, the state has what we call a funding formula, which is the state runs some math equations to determine what each district needs to provide the educational support for their students, and how much should the state pay for it. That’s based upon the ability from a local town to contribute property tax dollars. In that formula, when CT is calculating what the kids in this district need, we look at low income students and we look at multilingual learners, students who are learning English. But we don’t look at special education students,” says Gibson.

Gibson says special education should be included in the formula so more special education funding can be given up front. “When we think about the tough choices local districts have to make in terms of keeping their budgets on the line but also making sure all kids are supported, if the state would include special education students in its funding formula, it would better equip our school districts to better provide those supports to special education students and therefore every student in the district.”

Back in West Hartford, Finn’s mom Brooke hopes the people making these funding decisions think about Finn when they do.

“Yes Finn has special needs, but he’s also just like your children and he deserves to get the services he needs to be an independent and successful student,” says Brooke.

The state has designated an additional $30 million for 2026 and 2027 for a new “special education expansion grant,” that school districts can use to expand on-site services.

At the same time, lawmakers will examine how much out-of-district programs charge for services, and see whether setting provider rates, like Massachusetts does, can work for Connecticut.

To find out the special education excess cost expenditures in your city or town, CLICK HERE.

For general special education expenses, head to the Department of Education’s website, CLICK HERE.