Oregon education funding committee recommends increasing school spending by $2.5B to $5B

But the commission’s recommendations are likely dead on arrival in the Oregon Legislature, which will in January face the task of balancing declining revenues and rising public health care costs following historic federal cuts. Several lawmakers have more recently begun interrogating the efficacy of the state’s education commission and the 27-year-old model commissioners use for measuring what schools need to reach achievement targets. A second school funding formula used by the Oregon Department of Education to determine appropriate spending based on schools’ student demographics, such as poverty levels, and special education and language services needed, tends to play a larger role in how the Legislature allocates school funding. That formula has also come under heavy criticism for not adequately measuring and incorporating those demographic factors.

Overhaul of Oregon school funding formula, goals of public education has lawmakers at odds

For decades, lawmakers did not meet the commission’s recommended funding levels, but Gov. Tina Kotek has twice pushed the Legislature to approve larger allocations from the State School Fund and General Fund to get closer to meeting the recommendations. The state now spends about $1,000 more per-pupil than the national average — roughly $19,700 per K-12 student as opposed to the average of about $18,800 — but outcomes have not improved, and Oregon’s kids rank at the bottom in national assessments of reading proficiency when adjusted for demographics.

For leaders of the state’s biggest teachers unions, the latest spending recommendations from the education commission are indicative of years of underfunding Oregon’s schools while continuing to lean on those schools to provide more opportunities, resources and a greater safety net for Oregon kids.

Efren Zamudio, a spokesperson for the Oregon Education Association, the state’s largest teachers union, said union officials understand Oregonians and their elected officials may have sticker shock reading the report.

The Legislature in 2025 approved a record $11.3 billion of state funding for schools in the 2025-27 school years. The latest commission report recommends lawmakers allocate nearly $13.8 billion to maintain the status quo for the 2027-29 school years, and more than $16.2 billion to meet new student accountability targets — such as improvements in third grade literacy and eighth grade math proficiency — and attendance rules that bar districts from shortening the school year to balance their budgets.

“The 2026 QEM report shows that education costs are rising, in double digits,” Zamudio said in an email. “The reason is simple: a quality education for 540,000 students across a large, diverse state is costly. It takes passionate and dedicated professionals to boost attendance, close literacy gaps, meet mental health needs, maintain learning facilities and deliver a quality education to each student that comes through school doors.”

For school administrators, education advocacy groups and some lawmakers, the recommendations indicate major issues with the commission and its modeling as well as increasingly unsustainable personnel costs. Personnel compensation is the “paramount driver” of K-12 operational expenses, according to the commission’s report, accounting for about 85% of State School Fund dollars allocated to districts.

‘More money alone doesn’t do it’

“We can’t keep going to the Legislature and say: ‘Give us more money.’ More money alone doesn’t do it. I think that this further illustrates the fact that we can’t keep doing what we’ve always done and think we’re going to get something different,” said Tricia Mooney, superintendent of the Hermiston Public School District in eastern Oregon and chair of the Quality Education Commission.

Despite the Oregon Department of Education participating in the commission’s work, including cost modeling, and their request in the latest report for 19 more full-time and temporary staff to work on future cost modeling, agency officials referred all questions to Mooney, a full time school administrator and volunteer on the commission.

Rising pension costs coupled with new state programs including Paid Leave Oregon and unemployment benefits for striking public workers and for classified staff add to what schools have to cover with their limited budgets, Mooney explained. Paid Leave Oregon and the expanded unemployment benefits have cost Hermiston Public Schools about $250,000 in the current school year, according to district records.

“I’m not trying to say our classified staff members are overpaid because we don’t believe that at all,” she said. “But there are real costs that sometimes (the Oregon Legislature) doesn’t take the time to think all the way through, and then we get to a point where we are today, and we say, ‘Wow, that’s expensive!’”

Union leaders, lawmakers and Mooney in conversations and correspondence with the Capital Chronicle all called for a collaborative process around remodeling the commission’s formulation for what schools need, which would include school finance experts and input from school administrators and teachers.

“We are not opposed to examining or improving the model. I think we would be open to a thoughtful, collaborative and transparent review that includes educators, families, students, and community members across all of Oregon,” said Alisha Chavez, the new president of the Portland Association of Teachers, representing the state’s largest school district.

“We need to be looking at actual student needs, mandated services by the state that are currently not funded and so much more that has not been updated in the Quality Education Model,” Chavez added.

Confidence in current model eroding

During the most recent legislative session, Sen. Janeen Sollman, D-Hillsboro, and Rep. Ricki Ruiz, D-Gresham, co-chairs of the six-member Joint Public Education Appropriation Committee, spearheaded an unsuccessful effort to terminate and replace the commission and its current modeling system.

The two proposed reassigning the task of researching and determining how much money schools need to the Legislature’s nonpartisan Policy and Research Office, which would contract and work with a public or private firm to undertake school finance analysis. As part of the analysis, researchers would have to hold panels with educators across the state about school needs.

The proposal died under pressure from teachers unions, school administrators and other lawmakers, who saw it as too much to undertake during a short one-month session.

“Confidence in the Quality Education Model has been eroding for some time, and this year’s report will only deepen that skepticism,” Sollman said in a statement.

She lost her primary election in part because the Oregon Education Association supported her opponent, and she’ll leave the Senate in January. But she’s continuing to advocate for school funding experts to take over Oregon’s modeling with input from schools and teachers, rather than leaving it to the commission and the Oregon Department of Education.

“Oregon’s education system is in crisis. We desperately need better data to get our students the support and resources they deserve,” she said.

Mooney agreed.

“We have to rebuild. What we’re doing is not working, right?” she said, adding that changing it will be challenging for lawmakers.

But, she said, the Legislature will have to lead on the issue.

“If we don’t start now, then we’re another two years out, and our kids today can’t afford that,” she said.

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