Summary of Senate Bill 881 (2025-2026)
Jurisdiction: Michigan
Title: Appropriations: supplemental; supplemental appropriations in the school aid act for fiscal year 2026-2027; provide for. Amends secs. 11 & 17b of 1979 PA 94 (MCL 388.1611 & 388.1617b).
Purpose
- To modify and specify supplemental appropriations within the Michigan School Aid Act for multi-year fiscal planning, including 2025-2026 and 2026-2027.
- Establish detailed funding sources and payment timing for K-12 and related education programs, while directing how unspent general fund allocations roll into the School Aid Stabilization Fund.
Key Provisions
1) Sec. 11 – General appropriations and fund sources
- For the fiscal year ending September 30, 2025:
- Total appropriations for public schools and related education purposes from multiple sources include:
- State School Aid Fund: $17,936,546,300.00
- General Fund: $78,830,600.00
- Community District Education Trust Fund (up to): $41,000,000.00
- School Transportation Fund (up to): $125,000,000.00
- Enrollment Stabilization Fund (up to): $71,000,000.00
- School Meals Reserve Fund (up to): $30,000,000.00
- Great Start Readiness Program Reserve Fund (up to): $18,000,000.00
- MPSERS Retirement Obligation Reform Reserve Fund (up to): $481,400,000.00
- Educator Fellowship Public Provider Fund (up to): $30,000,000.00
- For the fiscal year ending September 30, 2026 and 2027:
- Total appropriations listed as: $18,366,334,700.00 plus various line-item additions (quantities shown as “$100.00” with formatting irregularities in the draft, but intended to reflect separate fund sources totaling the described amounts).
- Specific fund sources (illustrative, subject to final legislative text):
- State School Aid Fund
- General Fund
- School Consolidation and Infrastructure Fund
- School Transportation Fund
- Enrollment Stabilization Fund
- Great Start Readiness Program Reserve Fund
- Educator Fellowship Public Provider Fund
- State School Aid Pupil Support Reserve Fund
- General Pupil Support Reserve Fund
- All available federal funds are appropriated only as allocated in this article for the fiscal years ending 2025 and 2026-2027.
2) Sec. 11 (2) – Allocation priority
- General Fund allocations under this article must be expended to fund purposes of the School Aid Act before expenditures from the State School Aid Fund.
3) Sec. 11 (3) – Unexpended General Fund money
- Any general fund allocations not expended by the end of the fiscal year are transferred to the School Aid Stabilization Fund (Section 11a).
4) Sec. 17b – Payment administration and timing
- Establishes an installment schedule for distributing funds to school districts and intermediate districts:
- Payments are scheduled on the 20th of each month from October through August (dates listed: Oct 20, Nov 20, Dec 20, Jan 20, Feb 20, Mar 20, Apr 20, May 20, Jun 20, Jul 20, Aug 20).
- Necessary to deliver electronic files to the state treasurer by these dates, who then pays the districts.
- Each monthly installment typically equals 1/11 of the district’s annual entitlement, with accrual for July and August to the school fiscal year ending the prior June 30.
- Payments may be made via warrants or electronic funds transfer, per district preference.
- The Department may adjust payments to correct errors or reflect legal changes.
- Absent special provisions, grants follow the standard installment schedule.
- Advance releases:
- Upon written request and with approval from the district superintendent, state treasurer, and budget director, an advance payment may be approved for temporary, nonrecurring needs.
- Advance payments cannot be more than 30 days earlier than the established payment date.
Action History
- 2026-04-14: Reassigned to Committee on Appropriations
- 2026-03-18: Introduced by Senator Sarah Anthony
- Rules suspended; referred to Committee of the Whole
Sponsors
- Primary sponsor: Senator Sarah Anthony
- Co-sponsor: Senator (as noted) Sarah Anthony
Impact Overview
- Budget scope: Expands and specifies supplemental appropriations across multiple education-related funds and programs for 2025-2027, with a clear preference order placing General Fund allocations before State School Aid Fund expenditures.
- Funding streams: Creates or redraws allocations from numerous dedicated funds (e.g., School Transportation Fund, Enrollment Stabilization Fund, Great Start Readiness, MPSERS reserve, etc.) to support public schools.
- Cash management: Establishes a predictable monthly disbursement schedule to districts, with mechanisms for adjustments and potential advances for urgent needs.
- Stabilization and contingencies: Incorporates transfer of unspent General Fund dollars into the School Aid Stabilization Fund, supporting fiscal resilience.
- Federal funds: Confirms that all available federal funds are to be appropriated as allocated.
Note: The bill text contains formatting inconsistencies (e.g., repeated “$100.00” insertions) that appear to be drafting artifacts. The substantive intent is to restructure and confirm supplemental school aid appropriations and the timing of district payments for 2025-2027.
