Tennessee Advisory Commission on Intergovernmental Relations (TACIR)
Harry A. Green, Executive Director

Prototype System Model

In October 2005, the TACIR staff released a report on the prototype model prepared for the Governor’s Task Force on Teacher Pay and the Basic Education Program Review Committee (BEPRC). The report, A Prototype Model for School-System-Level Fiscal Capacity in Tennessee: Why and How presents an overview of events leading to the appointment of that task force and subsequent attempts to improve the state’s method of equalizing funding for public schools with emphasis on the equalization model developed by TACIR staff. The prototype model was intended to replace the county-level fiscal capacity model (the TACIR model) used from the inception of the Basic Education Program funding formula in 1992 through 2007.

The links below are to documents prepared for the BEPRC, which is appointed by the State Board of Education, and presented to the committee in various meetings over the last two years. The executive director of TACIR is a statutory member of the committee. Public Chapter 670, Acts of 2004, required the BEPRC to "prepare an annual report on the BEP and [provide] such report, on or before November 1 of each year, to the governor, the state board of education, and the select oversight committee on education." The Act also requested the BEPRC "[i]n reviewing the basic education program for fiscal year 2005-2006, . . . to give special consideration to . . . the development and implementation of a system-level fiscal capacity model."

The BEPRC voted in October 2005 to recommend implementation of a system-level fiscal capacity model along with several significant enhancements in the BEP funding formula. (BEP Review Committee 2005 Annual Report, November 2005.); however, the Governor’s BEP 2.0 initiative of 2007 instead adopted an arithmetic, county-level model (the FOX model) developed by UT-CBER to replace the TACIR model. The earliest any changes could be implemented would be school year 2006-07. Adoption of a system-level model would have to be approved by the State Board, the Commissioner of Education and the Commissioner of Finance and Administration. Other proposed changes would require those approvals plus legislative action. The BEPRC recommended that the improvements occur in a “comprehensive, simultaneous, and timely” manner.

Since 2008, the TACIR model has been used in conjunction with the CBER model, an arithmetic tax capacity model produced by the Center for Business and Economic Research (CBER) at the University of Tennessee. The stated intent of the administration was for the weight of each measure to shift toward CBER annually until its calculation was the only one used, but the percentages have remained at 50/50 for FY 2009. The Department of Education has not announced an official transition schedule for future fiscal years.