MOE Waiver Request, Florida (FY 2023 Elementary, Secondary and Higher Education)

Summary

Florida's MOE Waiver Request, requesting a waiver of the FY 2023 maintenance of effort requirements for elementary and secondary education and for higher education under section 2004(a) of the ARP Act. The data table gives FY 2023 elementary and secondary support of $17,062,291,861 and overall State spending of $69,835,058,092, with elementary and secondary support at 24.43% of State spending against a 24.55% three-year baseline average, and higher education at 7.88% against 9.51%. The State's narrative says its General Fund revenues have rebounded above pre-pandemic levels, with FY 2023 collections of $47.3 billion, and that overall State spending has outpaced growth for K-12 education support, so the FY 2023 share fell below the baseline ratio. These are the State's own figures and characterizations; no date is printed.

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MOE Waiver Request
Florida

On behalf of my State, | request a waiver of the following State maintenance of effort (MOE)
requirements for the following fiscal years:

¥ FY 2023 MOE requirement for elementary and secondary education under section 2004(a)of the
ARP Act.
¥ FY 2023 MOE requirement for higher education under section 2004(a)of the ARP Act.

Data for State support and overall State spending

State support State support Overall State State support State support
forelementary | for higher spending elementary and higher education
and secondary | education secondary education | asa proportion of
education as a proportion of overall State
overall State spending | spending

FY 2017 | $11,355,704,370 | $4,375,033,008 | $46,288,077,650 24.53% 9.45%

FY 2018 | $11,876,044,977 | $4,583,694,966 | $46,577,325,145 25.50% 9.84%

FY 2019 | $12,115,836,160 | $4,731,853,800 | $51,289,240,229 23.62% 9.23%

3-year baseline average 24.55% 9.51%

FY 2020 | $12,448,093,364 | $4,797,636,798 | $43,323,535,741

FY 2021 | $12,834,507,695 | $4,907,674,996 | $27,819,371.093

FY 2022 | $12,843,639,699 | $5,111,527,975 | $49,313,506,341 26.04% 10.37%

FY 2023 | $17,062,291,861 | $5,502,048,535 | $69,835,058,092 24.43% 7.88%

1. Adescription of the extent to which the State experienced fiscal burdens in preventing,
preparing for, and responding to coronavirus and an explanation of how those fiscal burdens
affected the State’s ability to maintain fiscal effort (e.g. the status of and any changes to the
State’s rainy day fund, whether the State experienced a decline in revenues, or an increase in
other emergency expenses resulting from the pandemic, such as expenses related to health
care, unemployment insurance, or support for small businesses):

The legislature has strictly followed constitutional provisions requiring that budget surplus and
additional revenues be used in certain ways to respond to future emergencies and safeguard
investments in infrastructure.

State General Fund revenues have rebounded to above pre-pandemic levels. FY 2023 state general
fund collections totaled $47.3 billion, exceeding the 3-year baseline state General Fund collections
by over $16 billion. Over this same time period, the state has made substantial increased
investments in state support for both K-12 education and higher education, increasing state support
above pre-pandemic levels.

Despite these new investments in both K-12 education and higher education, overall state spending
has outpaced growth for K-12 education support, resulting in the FY 2023 support for K-12
education as a share of overall state spending falling below the baseline ratio as required for the

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Elementary and Secondary Schools Emergency Relief (ESSER) Fund and the Governor’s Emergency
Education Relief (GEER) Fund. However, the state’s ability to direct the increased revenues to K-12
support was both restricted and limited by the constitutional requirements, debt obligations, and
fiscal policy. To understand these restrictions and limitations as related to the MOE requirements, a
background on the Florida Education Finance Program (FEFP) as state support for K-12 education is
necessary.

Each year, the Florida Legislature identifies and prioritizes the state’s needs across all state agencies,
including education, healthcare, social services, transportation, environment, agriculture and
consumer services, etc., and appropriates funds to meet those needs. The appropriations for
elementary and secondary education vary from year to year depending on enrollment growth, and
the funding level of several components within the FEFP, which is the state’s primary mechanism for
funding school district operations, and ensures an equitable distribution of funding across school
districts.

The FEFP is funded with both state and local property tax dollars, and increases or decreases in
property values directly impact the level of state funding needed to fund the FEFP. In years with
larger increases in property values across the state, a lower level of state funding is needed to fund
the FEFP. Conversely, in years with smaller increases in property values, a larger amount of state
funding is needed.

There are also local property tax levies that are separate from the FEFP which generate substantial
funds for school districts. In years with larger property value increases, these levies generate larger
amounts of revenue than the prior year. In years with lesser growth in property values, these levies
generate little additional funds from one year to the next.

2. Documentation and data supporting the description of State’s fiscal burdens (e.g., revenue data,
appropriation tables, unemployment statistics, etc.) including any State action that impacted
State revenue (e.g., tax increases or decreases).

The pandemic not only strained the state’s medical system, but it also caused a 43.6 percent
increase in caseloads in FY 2023 within the state’s Medicaid system as compared to the baseline
3 years. This increase has cost the state approximately an additional $1.5 billion in FY 2023 to
match the Medicaid increase of $11.5 billion.

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Monthly Caseload in Millions

Florida Medicaid Program
Expenditures and Caseload
$40 6.0
5.6
$35 5.0
A
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a 4.0
$30 4.0
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$25 = 3.0
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3. In addition, in its waiver request, a State should submit information on the relevant factors
listed below to support its request. The Secretary may ask for additional information after
States submit the MOE waiver request form.

A. Has the State increased support for education?

1. Has total State funding for K-12 education and for higher education (calculated
separately) increased from the prior fiscal year?

Yes

The table below illustrates the higher rate of overall state spending when compared to state support
for K-12 education and higher education, and which caused the share of overall state spending on
education to fall below the MOE baseline average.

State Support K-12 State Support Overall State Spending
Higher Education
Baseline $11,782,528,502 $4,563,527,258 $48,051,547,675
FY 2023 $17,062,291,861 $5,502,048,353 $69,835,058,092
Increase ($) $5,279,763,358 $938,521,094 $21,783,510,417
Increase (%) 44.8% 20.6% 45.3%

Increased Support for K-12
Florida has significantly increased total state support for both K-12 and higher education over
the MOE baseline years beginning with FY 2017. These increases have been consistent year-

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over-year. The increased support is targeted and demonstrates a commitment to not only
maintain, but increase, support for education statewide.

Florida has used the increased funding to support pay raises for teachers to increase their
average pay from $48,486 in FY 2019 to $53,142 in FY 2023, which is an average annual increase
of 2.40 percent.

Increased Support for Higher Education

Similar to the K-12 funding, Florida’s continues to. provide significant investments for higher
education over the MOE baseline years beginning with FY 2017. These investments increase
year over year without increasing tuition at Florida’s public institutions.

2. Has per-pupil State funding for K-12 education and for higher education (calculated
separately) increased over time (e.g., since baseline years)?

Yes
K-12
The base-per-pupil state funded amount maintained by the FEFP formula increased by 8.5

percent from FY 2019 to FY 2023 from $4,188.20 to $4,542.73.

FEFP State Pupil Funding

FY 2019 $4,188.20
FY 2023 $4,542.93
Increase (S) S$ 354.73
Increase (%) 8.5%

3. Has the State appropriated an increase in State funding for K-12 education and for
higher education for the future years?

Yes

K-12 state funding
Fiscal Year State Funded Appropriations
FY 2023 $17,062,291,861
FY 2024 $17,504,032,084

Increase

$441,740,222

Higher education state funding
Fiscal Year State Funded Appropriations
FY 2023 $5,502,048,353
FY 2024 $6,490,053,323

Increase

$988,004,970

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B. Are there exceptional circumstances that caused the State to be unable to maintain support
for education?

Despite the increased state funding and expansion of services and supports for schools and
students, Florida is unable to achieve the MOE technical requirements for FY 2023. The
proportional level of state’s support for elementary and secondary education relative to
Florida’s overall spending declined in FY 2023 because of the state’s necessary investments in
addressing other urgent priorities. During 2021, Florida sustained damage from three
hurricanes. In addition, the state had a record number of people migrate to the state. Asa
result of these events, in FY 2023 the state funded one-time initiatives in specifically targeted
areas, including post-hurricane disaster recovery, accelerated transportation projects and land
acquisition for conservation. The most significate of these one-time initiatives in FY 2023 are as
follows:

Environmental sector

e $850 million non-recurring state funding for the Department of Environmental Protection
(DEP) to purchase lands for the Florida Wildlife Corridor

e §251.5 million non-recurring state funding in 2022 Special Session A for DEP Disaster Relief
related to Hurricanes lan and Nicole.

® $177.9 million increase in funding for State Park maintenance and repair, with $130.5
million included to address the backlog of repair at State Parks.

e $136 million increase for Waste Cleanup Programs (Petroleum, Dry-cleaning and Hazardous
Waste).

e $428.1 million increase, for a total of more than $1 billion, for Everglades restoration and
the protection of water resources.

e $300 million, for a total of $500 million, for the Resilient Florida Grant Program for
implementation of statewide resilience projects, including fully funding Florida’s first ever 3-
year Statewide Flooding Resilience Plan.

e $144.2 million for Drinking Water and Wastewater Emerging Contaminants (BIL) funding.

Transportation and Economic Development sector

e $4 billion non-recurring state funding to the Department of Transportation for the Moving
Florida Forward Plan to accelerate completion of selected road projects and provide traffic
congestion relief in the state.

oO This was a 22-23 FCO appropriation; not all of the $4 billion was expended in FY
2023.

e $350 million non-recurring GR appropriated in 2022 Special Session A to Department of
Emergency Management to provide the match requirement for Public Assistance Program
grants for Hurricanes lan and Nicole.

e $150 million non-recurring state funding in 2022 Special Session A for the Florida Housing
Finance Corporation’s Affordable Housing for Hurricane Recovery related to Hurricanes lan
and Nicole.

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e $100 million non-recurring state funding for the Florida Housing Finance Corporation to
implement a competitive assistance loan program for new affordable housing construction
projects

@ $100 million non-recurring state funding to establish the Florida Hometown Hero Housing
Program to provide down payment and closing cost assistance to eligible homebuyers.

® $2.2 billion increase in the Transportation Work Program

C. Has the State used or will it use ESSER, GEER, or Higher Education Emergency Relief (HEER)
funding to replace State funding for education?

No. The state has not, nor does it intend to use ESSER, GEER, or Higher Education Emergency
Relief (HEER) funding to replace State funding for education. All ESSER, GEER, and HEER funds
were allocated for new supplemental educational activities over and above what the state
funding formulas provided.

To the best of my knowledge and belief, all of the information in this MOE data submission are true and
correct and the failure to submit accurate data may result in liability under the False Claims Act, 31
U.S.C. 3729 et seq.; OMB Guidelines to Agencies on Governmentwide Debarment and Suspension
(Nonprocurement) in 2 CFR part 180, as adopted and amended as regulations of the Department in 2
CFR part 3485; and 18 USC 1001, as appropriate, and other enforcement actions:

Manny Diaz, Jr., Commissioner, Florida Department of Education (850) 245-0073

AVurAe 0bO 6-29-24

Signature Date

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