RD309 - Annual Report on the Updates to the Standards of Quality


Executive Summary:
In accordance with Chapter 3 of the 2006 Acts of Assembly, the Department of Planning and Budget (DPB) in coordination with the Department of Education (DOE) has prepared an interim report on the update to the Standards of Quality (SOQ), based upon the most current data available. This update does not include a rebenchmarking of the SOQ model, which is done at the beginning of each biennium.

This report contains one known update to projected state costs for the Standards of Quality in the 2006-2008 biennium:

An adjustment to the Lottery estimate that decreases the projected revenues for both FY 2007 and FY 2008; and

The following table details the expenditure impact of the Lottery update to the Standards of Quality:


Projected Additional State Costs vs. Chapter 3

Update Lottery proceeds for Public Education
FY 2007 $12,709,800
FY 2008 $12,709,800


Details

On October 18, 2006, the Virginia Lottery informed the Governor and Chairmen of the Senate Finance and House Appropriations Committees that Lottery estimates for FY 2007 and FY 2008 had been revised. It is now projected that the Lottery will generate a net income of $405.4 million in fiscal year 2007 and $405.4 million in fiscal year 2008. This revised Lottery estimate reflects a decrease of $20.7 million compared to the estimate found in Chapter 3 for both years. The result of this change is an increase in the state share of basic aid of $12.7 million and an increase to localities of $8.0 million to compensate for the reduction in Lottery proceeds. The Virginia Lottery primarily attributes the decrease in revenue projections to the impact of the North Carolina Education Lottery, which began in 2005.