How States Implement Hold-Harmless Provisions in 2020 and 2021. Research Brief

Hold-harmless provisions in state aid formulas are meant to restrict declines in revenues for school districts. They may take several forms, including limits on the changes in state aid from year to year, supplemental funding for districts with declining enrollment, alternatives for calculating the state aid amount, or use of past enrollments in grant calculations (Toutkoushian & Michael, 2008). Due to the COVID-19 pandemic, school districts across the country are experiencing a decrease in student enrollments, while states face reduced revenues and budget deficits in education. Therefore, hold-harmless provisions become an option for policymakers to meet the financial challenges created by the pandemic. This research brief analyzes multiple online sources (e.g., state governments, state departments of education, state school boards associations, local news). It found that nearly three in five states have implemented hold-harmless provisions or are likely to implement hold-harmless provisions in the 2020-2021 school year. In 11 states, there are some types of hold-harmless provisions embedded in basic grants for schools. In 10 states, it is unclear whether hold-harmless provisions will be implemented