Mississippi’s INSPIRE Act would upgrade the state’s school finance system
Photo 75676163 | State Capital © Sean Pavone | Dreamstime.com


Mississippi’s INSPIRE Act would upgrade the state’s school finance system

The proposal would improve funding fairness and better target education dollars to higher-need students.

Mississippi House Bill 1453, “The Investing in the Needs of Students to Prioritize, Impact, and Reform Education (INSPIRE) Act,” was recently approved by the state House and is now headed to the state Senate. The bill would overhaul Mississippi’s current education funding formula and replace it with a comprehensive weighted student funding model. 

Most school finance reforms, including this one, face uphill political battles. The Mississippi Adequate Education Program (MAEP), the state’s current formula implemented in 1997, has persisted despite multiple concerted efforts to fix it. 

The INSPIRE Act, though imperfect, would finally eliminate many of the longstanding problems in MAEP and replace it with a more streamlined and transparent funding formula that better accounts for individual student needs and empowers local leaders with more flexibility. 

INSPIRE is a significant improvement from the Mississippi Adequate Education Program

House Bill 1453 would implement sweeping changes to Mississippi’s K-12 finance system. 

1. Adopts weighted student funding

The most consequential reform proposed by the INSPIRE Act is the adoption of comprehensive weighted student funding (WSF). When a state uses WSF, its primary K-12 funding formula allocates a consistent per-student amount across school districts and includes weights that augment the per-student amount for students with additional learning needs, such as low-income and special education students. WSF is an increasingly common education funding model used by 33 states

The Mississippi Adequate Education Program currently uses weighted student funding to a limited degree because it has a base student amount and includes a 5% weight for students who qualify for free and reduced-price lunch (FRPL). However, MAEP falls short of comprehensively utilizing WSF because most categories of additional funding for higher-need students are funded by separate state grants called add-on programs that are outside of the basic formula. These add-on programs are directed for special education, gifted education, vocational education, transportation, and other purposes. 

The fact that these grants aren’t in MAEP’s basic funding formula might sound like an unnecessary technical distinction, but it’s not. A key advantage of WSF systems is that they are also foundation formulas—meaning they streamline most education funding into a single coherent formula that equalizes funding between school districts of varying local property wealth. Foundation formulas direct greater aid to districts that have less local wealth. The more states rely on grants outside of foundation funding—which Mississippi currently does with add-on program funding—the less they are accounting for differences in local resources in allocating state funds. 

The INSPIRE Act would improve funding fairness and better target education dollars to higher-need students by adopting the following funding structure:

INSPIRE Act’s Proposed Weights
Type% WeightDollar AmountDescription
Base Amountnone$6,650 Dollar multiplier applied to all students
Low Income30%+ $1,995Applied to students directly certified as homeless, in foster care, runaway or migrant, or from families participating in federal means-tested programs.
Concentrated Low Income10%+ $665Additional weight applied to each low-income student above a 35% district/charter population threshold. 
English Language Learner20%+ $1,330Applied to students identified as English learners under federal law.
SPED Tier I60%+ 3,990Applied to each student diagnosed with a specific learning disability, speech and language impairment, or developmental delay.
SPED Tier II125%+  $8,312.50Applied to each student diagnosed with autism, hearing impairment, emotional disability, orthopedic impairment, intellectual disability, or other health impairment.
SPED Tier III170%+ $11,305Applied to each student diagnosed with visual impairment, deaf-blindness, multiple disabilities, or traumatic brain injury
Gifted 5%+ $332.50Applied to all students; assumes a fixed proportion population of gifted students in each district/charter.
Career and Technical Education10%+ $665Applied to each student enrolled in a career and technical education course
Sparsity Weight0%-8%+ $0 to $532Applied to all students in a sparsely populated district; Weight varies by sparsity and applies to districts with less than eight students per square mile.

Importantly, the INSPIRE formula would replace the Mississippi Adequate Education Program under House Bill 1453, meaning that all add-on program funding except for transportation would be replaced by these weights. Eliminating the add-on programs improves fairness and flexibility because it eliminates the practice of allocating staffing positions based on staffing ratios and district-specific costs for students in special education, gifted, and career and technical education programs. 

2. Adopts enrollment-based student counts

Another meaningful reform adopted by the INSPIRE Act is that it counts students based on average daily membership (ADM), or enrollment. Under MAEP, Mississippi is one of just seven states that still funds schools based on average daily attendance (ADA). Although proponents of ADA-based funding argue it incentivizes school districts to keep students in school, there’s little evidence to support that claim. Instead, ADA tends to shortchange higher-need districts because disadvantaged students are more likely to miss school. Moreover, many of the reasons that students miss school—like chronic health issues and poverty—are beyond district control. This means the use of ADA unfairly and ineffectively penalizes higher-need districts. In fact, a previous Reason analysis of this practice in Mississippi calculated that the use of ADA shortchanged districts with attendance rates lower than the state average by nearly $19 million in the 2018-2019 school year. 

3. Other reforms

INSPIRE would implement several other positive reforms. 

  • Better poverty measure: Fourty-four states, including Mississippi, allocate additional funding for low-income students. Of that number, Mississippi arguably does the worst job of targeting resources for low-income students with its current “at-risk” funding because the state uses the broadest count mechanism (FRPL) and has the lowest weight (5% of the MAEP base amount per student). According to the National Center for Education Statistics, 99.6 percent of Mississippi’s students qualify for free and reduced-price lunch under the federal National School Lunch program. This FRPL share is significantly inflated due to multiple changes in federal policy over the past decade and during the COVID-19 pandemic, and it now has little use for identifying low-income students. The INSPIRE Act would adopt a more generous poverty weight while reducing the number of students qualifying for the funding. Massachusetts adopted a similar reform in 2015. 
  • Elimination of 2002 hold harmless provision: INSPIRE would repeal a provision ensuring that all Mississippi districts receive the same amount of state support for MAEP formula costs and several other non-formula grants that they received in 2002. According to Mississippi First, 10 school districts benefit from this law. 

Lingering issues and a competing bill

Although Mississippi House Bill 1453 would be a significant reform, most of the changes only impact how state education funds are allocated. How local education revenues are raised and retained by school districts is largely untouched by the INSPIRE Act. This includes the current requirement that districts raise 28 mills toward the funding formula and a law that no more than 27% of a district’s formula allocation can be covered by local mills. The 27% rule provision benefits wealthy districts by allowing them to tax at a lower rate locally than the prescribed 28 mills and still receive state formula funds. Moreover, although the current formula prescribes 28 mills, 81 of the state’s 148 school districts currently raise over 50 mills for K-12 operations. Per-student funding disparities between districts stem largely from how much each district can raise locally in Mississippi, an issue that state leaders should continue examining even if HB 1453 becomes law. 

Additionally, the persisting political issue of whether Mississippi’s formula is “fully funded” likely wouldn’t go away under the INSPIRE Act because the bill retains annual inflation adjustment language that the state legislature can choose to ignore. The full funding issue is also salient because a competing Senate bill—SB 2332—aims to preserve MAEP and soften the definition of full funding. The Senate bill would raise the 27% millage cap to 29.5% and require that 90% of state MAEP contributions be spent on instruction. Though some of the changes proposed in Senate Bill 2332 would marginally improve the current education funding system, Mississippi’s students would be better served by a formula overhaul. 

Bipartisan appeal of HB 1453

Understandably, partisan coalitions will have different reservations in the face of a sweeping education proposal like House Bill 1453. But, the proposed reforms in the INSPIRE Act should have broad political appeal. Comprehensive weighted student funding systems are operated in blue states, purple states, and red states. Student-centered funding is used in states with robust private school choice and states with no private school choice at all. To those on the left, weighted student funding has appeal because it prioritizes disadvantaged students. For conservatives, the model is attractive because it attaches funds to individual students. Finally, all parties are on board with the idea of ensuring taxpayer dollars are allocated transparently and united in their commitment to better serve Mississippi students.