Operating Budget

The Department educates and supports approximately 180,000 students and employs approximately 22,000 full-time employees and 20,000 substitutes and casual employees in positions across 294 public schools, 15 complex areas, and the state office. The operating budget for FY 2020 is $2.1 billion — $1.74 billion coming from the state's General Fund. Funds are distributed by program categories, known as EDNs. Nearly all funds go to schools.

Navigate using the links below.
Section I: Operating Budget (click here to view cycle)
Appropriation →
→ Allocation →
→ Allotment →
→ Expenditure
Resources that have been or are in the process of being approved by the Legislature and have become law. (Legislative Reference Bureau - The Budget Process)
Appropriation amounts provided (“allocated”) to programs to create expenditures plans. Allocated amount could be less than Appropriation due to restrictions set forth by the Governor or by the Department depending on the fiscal conditions of the time.
Once the Expenditure plans are completed and approved, resources are loaded (“allotted”) into the Financial Management System allowing programs to begin spending their allotted resources.
Actual use of the resources for payroll and by either purchasing or encumbering goods or services.
Timeline
Allocation Reports
HRS 37.42 (pdf)
ESSA Reporting
Challenges
 
 
Annual Financial and Single Audit Reports
Reports:
  • FY 22 appropriation summary
  • Identification of General Fund Shortfalls in HIDOE’s Operating Budget Appropriations for Fiscal Biennium 2021-23
Archives
 
 

Reports:

Monthly CARES and ESSER Act Spending Reports

Section II: CIP Budget (Click here for information on CIP)
Section III: Federal Education Stabilization Funds
Section IV: Appendix

The Operating Budget


FUNDING SOURCES


The Operating budget funding comes from four sources:

  • General funds (blue): Comes from the State of Hawaii’s general fund, primarily state tax revenues. This is the top source of funding to the Department.
  • Federal funds (red): The Department receives grants from federal agencies including the U.S. Departments of Education, Agriculture, Defense and Health and Human Services.
  • Special funds (yellow): Those coming from revenue-generating activities, including school food services, student bus transportation services, summer school program, after-school programs, adult education, driver education, and use of school facilities.
  • Trust funds (green): May include donations & gifts, foundations & other grants, school athletic program activity collections, and “fair share” and School Impact District​ developer fees.

FY20 pie chart: 82% general (state) funds, 13% federal funds, 4% special funds, 1% trust funds.


DIRECT-TO-SCHOOL FUNDING
  • EDN 100 is almost entirely distributed to schools using the Weighted Student Formula (WSF). The WSF gives schools a specific dollar amount for each student, and additional funds for students with certain characteristics, such as qualifying for the free and reduced lunch program (socioeconomically challenged) or being English Language Learners. This creates a transparent model of funding equity on a statewide basis. The balance of EDN 100 is used to support programs such as Athletics, JROTC and Alternative Learning Centers.
  • EDN 150 supports special education students who may require or have an Individualized Education Plan (IEP).
  • E​DN 400 pays school bills — sewer, electric, water, repair, food service and others.
  • EDN 500 pays for Adult Education programs at public schools.
  • EDN 700 pays for pre-kindergarten programs at public schools and is under the jurisdiction of the Executive Office on Early Learning.
SUPPORT FUNDING AT SCHOOL, DISTRICT, AND STATE LEVELS

Link to latest Budget Factsheet

FY 21 Supplemental Operating Budget (July 1, 2020 to June 30, 2021)

Here is a breakdown, by program category, of what the Legislature appropriated in General Funds for FY 2021 during the 2020 session. Percentages are rounded:

CATEGORY

STATE FUNDS (FY 21)

% (FY 21)

EDN 100: School Based Budgeting

$1.009 billion

60.5%

EDN 150: Special Education

$390.9 million

23.4%

EDN 200: Instructional Support

$59. 2 million

3.5%

EDN 300: State Administration

$52 million

3.1%

EDN 400: School Support

$143.7 million

8.6%

EDN 500: School Community Services

$4.1 million

< 1%

EDN 700: Early Learning

$9.9 million

< 1%


Link to FY 2021 Operating Budget Summary for a more detailed breakdown of these appropriations.

FY 21 Timeline of Major Events for Operating Budget for supplemental period (July 1, 2020 through June 30, 2021)

Budget instructions from the Department of Budget & Finance were issued on Sept. 4, 2019, as Finance Memorandum FM-19-11. The Board of Education approved the Department's Operating and CIP budget requests on Oct. 3, 2019. They were submitted to the Department of Budget & Finance for review by the Governor and decisions were issued on November 22, 2019.

The Governor’s decisions are documented in Finance Memorandum (FM) 19-18 and FM 19-18 Attachment (EDN – HTH); and will be transmitted to the Legislature for discussions and debate starting January 2020. 

The details of the Governor’s additions to the Department’s operating budget are included in the Department of Budget & Finance Form A’s and Form A’s for- trade off transfers.

On December 16, 2019, the Legislature sent out budget briefing instructions to all departments.

In January 2020, the Hawaiʻi DOE presented its fiscal year 2021 budget to several committees of the state Legislature. Click to view the presentations and supplemental materials (testimony tables and appendix).

The 2020 legislative session was suspended in mid-March due to COVID-19, and all bills and hearings were postponed indefinitely at the time. In May, the Legislature announced it would reconvene to address the state's budget shortfall.

On May 21, 2020, the Legislature passed a budget bill that reduces the Department's general fund base budget in the current and next fiscal year, FY 2020 and FY 2021.

OFS-FY20-FY-21-budget.png
The Legislature met for only a brief time and reconvened again in mid-June.

On June 4, 2020, the Department provided the Board of Education with an update on budget appropriation adjustments passed by the Legislature via HB 2200 HD1 SD1, which became law on July 7 as Act 007, Sessions Laws of Hawaii 2020, without the governor's signature.

The Legislature reconvened on June 22, 2020, to incorporate the Council on Revenues May 28 forecast and any additional federal COVID-19 impact relief funds approved by Congress. The budget bill (HB 2200 HD1 SD1) passed in May was amended on June 26, when the Legislature passed another bill (SB 126 SD1 HD1 CD 1) restoring all of the Department's FY 2021 vacant position full-time equivalent (FTE) reductions.

OFS-budget-SB-126.png

SB 126, SD1 HD1 CD1 includes how appropriations from the federal Coronavirus Aid, Relief, and Economic Security (CARES) Act are distributed statewide. The Department does not receive direct appropriations from SB 126, SD1, HD1, CD1 of the state’s share of CARES Act funding. Funding that benefits the Department is appropriated to other state agencies: Department of Defense, Department of Labor and Industrial Relations and Office of the Governor.

On July 31, 2020, the Governor signed SB 126 SD1 HD1 CD1 into law as Act 009, SLH 2020, incorporating line-item vetoes per Governor’s Message No. 1112, dated July 30, 2020.

The Governor’s line-item vetoes did not have a direct impact on the Department’s appropriations for FY 21.  

Although the net change to the Department’s general fund appropriation was -$88,785,572 for FY 21 due to the incorporation of existing appropriations from Act 276, SLH 2019, the overall impact of Act 009, SLH 2020, is a $100.2 million reduction to the Department's general fund base budget.

Act 009, SLH 2020, also did not include any of the Department’s requests for additional appropriations for its supplemental FY 2021 budget, that were submitted to the Legislature as part of the Governor’s Supplemental Executive Budget. 

Budget Cycle and Process


The state of Hawaii runs its budget on a fiscal biennium that's submitted to the Hawaii State Legislature during odd-numbered years, with course-corrections submitted during the intervening years via a supplemental budget. More information on state budgeting can be found here

For organizational purposes, the Department of Education and the other state departments fall under the Executive branch budget.

The Board of Education (BOE) approves the Department's budgetary plan annually around October roughly 8 months prior to the upcoming fiscal year. BOE meeting notices are available here.

The budget is then reviewed and modified by the state Department of Budget and Finance before submission to the Governor and then later to the Legislature when its session begins in January. The Legislature’s website can be found here

Once the budget is approved, normally late May, and becomes law, the allocation process distributes funds throughout the department. The legislative process can be found here.

This chart provides an overview of what the budget cycle looks like.

Appendix

  1. Budget Program ID and Descriptions
  2. General Funds Appropriations & Request in FY2008 - FY2023
  3. FY 2020 Year-End Fiscal Report
  4. FY 2020 Carryover Overview
  5. FY 2020 expenditures for Federal, Special and Trust funds
  6. Weighted Student Formula
  7. High-Needs Groups
  8. Teacher Positions Filled
  9. Teacher Retention
  10. FY 2020 $50 M Savings and FY 2021 $100.2 M Reduction
  1. New Stimulus Funding for Education
  2. NCSL Resource: The State Role in Education Finance
  3. Committee Action to Board of Education on Recommendation Concerning Operating Budget for 2021-2023 Fiscal Biennium
  4. Fiscal Biennium 2021-23 Budget Reductions & Restorations
  5. FY 2021 Budget Factsheet
  6. Federal Funds Information
    1. Title funding outlook
      • A review of the omnibus appropriations bill (P.L. 116-260) shows a stable outlook for federal title funds which we receive.
    2. Additional relief funding
  7. Non-General Funds Reports to the 2021 Legislature
    1. HRS 37-47
  8. State Auditor’s Office Report 20-08 a supplement to Report 20-06 on Special and Revolving Funds (May 2020) - Page 11-12
  9. Legislature
  1. FY 2020 Employment Report






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