The state budget bill approved by the Colorado House of Representatives on Thursday, March 31, lowers the state’s funding deficit for K-12 education to $321 million for the 2022-23 school year, down from a $503 million deficit this year.

The funding deficit, referred to as the budget stabilization factor, is the lowest it has been since legislators created the mechanism in 2010, when the state struggled to find enough revenue to fully fund schools.

“I’m really proud of how low we’ve been able to get the BS factor,” said Rep. Julie McCluskie, a Democrat from Dillon who chairs the legislature’s Joint Budget Committee. “I’m going to work very hard to keep that investment right where it is.”

School funding in Colorado is based on a formula that takes into account population and inflation, but as the state dealt with the 2007-09 recession, legislators created the budget stabilization factor, which proportionately reduces funding to school districts.

Each year since, the legislature has underfunded schools according to the formula and withheld the money for other expenses. The total deficit in school funding is now close to $10 billion over the last 12 years.

In the current fiscal year, the Steamboat Springs School District is missing out on about $1.5 million in state funding compared to what the formula says the district is owed, according to Stephanie Juneau, finance and operations director for the district.

Based on the bill passed by the Colorado House on Thursday, Juneau estimates the funding shortfall in Steamboat would drop to about $986,000 for the upcoming fiscal year that starts in July. The funding change represents an increase in per pupil funding of about $530 per student in Steamboat.

“That’s as good as I was expecting,” Juneau said. “It’s at least something that we have to go off of, but it is not done until it’s done. I’ve seen things very late in the session change.”

McCluskie said she would have liked the legislature to further reduce the deficit, but added that a 7% rate of inflation will already require an increase of $300 million in school funding next year.

“We’re going to have to find that $300 million to pay for our school districts and that is before we try to buy down the budget stabilization factor,” McCluskie said.

The bill started in the House. The Joint Budget Committee, a bipartisan, six-member group of three state representatives and three senators. After being approved by the House, the budget bill, referred to as the long appropriations bill, will move on to the Senate.

“Ultimately, I’m very confident that we are going to see this budget move through and that we’ll be able to protect those investments in K-12 education,” McCluskie said.

On Monday, the Steamboat Springs Board of Education approved a resolution pressuring the legislature for full funding based on the formula and to repay the nearly $10 billion the budget stabilization factor has curbed from school funding.

McCluskie said she would like to fully pay back schools, but doing so would require major changes.

“Until this state engages in significant fiscal reforms, we will never have the ability to do that,” McCluskie said.