Understanding the BEP. TASBO Breakout Session Murfreesboro, Tennessee November 16, 2011. History of the BEP. 1977—enactment of Tennessee Foundation Program—funding formula that increased state’s contribution and used local property value to determine a county’s ability to pay.
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TASBO Breakout Session
November 16, 2011
Per Pupil Own-Source Revenue
Amount of local money that the school systems in the county report that they spend on education, divided by enrollment (average daily membership (ADM)
Per Pupil Equalized Property Assessment
Total property assessment for the county area, equalized by the appropriate county appraisal-to-sales ratio, and then divided by ADM. This is a measure of the local ability to raise revenue.
Per Pupil Taxable Sales
Local sales tax base divided by ADM-measure of the local ability to raise revenue.
Per Capita Income
Per capita income is included in the fiscal capacity model as a proxy measurement for ability to pay for education; and for
all other local revenue not accounted for by property or sales taxes.
Ratio of total equalized residential and farm assessment in each county divided by the total equalized property assessment. This variable is intended as a proxy for a county’s potential ability to export taxes. A high residential/farm ratio indicates a low ability to pass taxes on to non-residents.
Included as a reflection of spending needs. It equals average daily membership divided by county
population. The greater the number of pupils per 100 residents, the greater the fiscal burden for each taxpayer.
Equalized Assessed Property plus IDBs (3-year average): $ 19,130,924,199
Sales Tax Base (3-year average): $ 10,702,878,267
Fiscal Capacity =($19,130,924,199 x 1.1583%)+ ($10,702,878,267 x 1.5570%)
= $221,593,495+ $166,643,815
= $ 388,237,310 /$2,754,000,000 (state total)
Fiscal Capacity Index = 14.10%
50% of TACIR Model & 50% of CBER Model
Davidson County Index
(TACIR Capacity Index x .50) + (CBER Capacity Index x .50)
14.50% x.50 + 14.10% x.50 =14.30%
Total State BEP Funding
Total State BEP Funding