Key Components & Benefits of STARS Act: House Bill 252 Overview

An Overview of Key Components & Benefits House Bill 252: STARS Act

Enhancing School Funding Formula Incentives for Teacher Base Salaries Increases in teacher base salaries to attract and retain qualified educators Greater Inclusivity for Incentives Emergency Authorized Certified Staff District Clerks American Indian Language and Cultural Specialists HB 252

Enhancing School Funding Formula Greater Inclusivity of Educational Entities Cooperatives School for the Deaf and Blind Correctional Facilities as defined 41-5-103, MCA Montana Youth Challenge Future Ready and Advanced Opportunities Funding Addresses Housing Shortages Greater Transparency Identifies the State s Share of School Funding By Law

Where is this bill currently? Bipartisan support Passed the House Referred to Senate Education & Cultural resources committee on March 4, 2025 Not on the agenda yet Effective date: upon passage and applicable July 1, 2025 Except: Future ready payments for FY26 graduates will be paid in FY28 Except: Resource sharing incentive distribution in FY27

Definitions Advanced Opportunity Aid: for each fiscal year, the following percentages of a district s total QE/QS payment under 20-9-306, MCA in the prior year after subtracting any adjustments to the district s total QE/QS payment made under 20-9-324, MCA. CTE-equivalent credit: career and technical education (CTE) credit value ascribed by the department of labor and industry. Educational Entity: Public School Districts, Special Education Cooperatives, the Montana School for the Deaf and Blind, Correctional Facilities, and the Montana Youth Challenge Program.

Definitions Full time equivalent teacher: a teacher who is contracted for employment for the entire academic year, fulfilling professional responsibilities throughout all periods of the day when the educational entity offers instruction. This includes time spent preparing for classes, delivering instruction, mentoring others, and performing other duties set forth in the teacher s job description, individual contract, or in the collective bargaining agreement governing the teacher s employment. Future Ready Payment: a new component of the base aid formula. Maximum General Fund Budget: now includes qualified staff and the total future ready payment.

Definitions Postsecondary Credit: the successful completion of a course of study by a student enrolled in a high school or K12 district that results in the student s eligibility for transcribed credit within the Montana University System. Quality Educator (QE): the number of full-time equivalent educators as reported to the superintendent of public instruction for accreditation purposes in the previous school year, each of whom: Holds a valid certificate under 20-4-106, MCA and employed by an educational entity in a position that requires an educator license in accordance with the administrative rules adopted by the board of public education or

Definitions holds an American Indian language and culture specialist license and is employed by an entity listed in subsection (1) to provide instruction in American Indian language and culture. The number of qualified staff is the number of full-time equivalent staff, each of whom is employed by an educational entity listed in subsection (1) to provide services to students as a licensed professional under 37-8- 405, 37-8-415, 37-11-301, 37-15-301, 37-17-302, 37-24- 301, 37-25-302, 37-39-308, 37-39-309, or 37-39-311; Is employed by an educational entity listed in subsection (1) and has been issued an emergency authorization of employment under 20-4-111 for that entity for no more than 3 school years or; Is employed by a public school district, as defined in 20-6- 101 and 20-6-701, as clerk of the district and performs the function described in 20-3-325(3) (see qualified staff).

Definitions Qualified Staff (QS): (aka District Clerks and Emergency Authorized Staff) included in GTB tax, base aid budget limits and base aid payments, and transformational learning calculations, in a similar fashion to the QEP. Teacher: holding a 1, 2, 4, 5, 6, 7 license and employed by an educational entity. Teacher Average Pay: the total compensation paid by an educational entity to all its teachers, not including bonuses, stipends, or extended duty contracts, divided by the total full-time equivalent teachers employed by the entity.

Definitions Teacher Base Pay: the lowest salary for a full-time equivalent beginning teacher for the current year as incorporated in the educational entity s collective bargaining agreement or a memorandum of understanding executed between the entity and the applicable union if the teachers employment is covered by a collective bargaining agreement pursuant to Title 39, chapter 31, or incorporated in the entity s policy if the teachers employment is not covered by a collective bargaining agreement, not including bonuses, stipends, or extended duty contracts.

Items to Comply and Receive Incentives District Clerk Job Description Graduated goal- starting teacher wage within 70% of the average teacher pay. 62% FY26 64% FY27 66% FY28 68% FY29 70% FY30 Ensure that you can pay your starting teachers at least eleven (11) times the Quality Educator Payment (QEP) allocation. Must submit data necessary as determined by the OPI- aka FTE through Infinite Campus, and other applicable reports by the due dates outlined by law and if not outlined, then mandated by OPI.

District Clerk Job Description MCA 20-3-325 Amended Must include the following: Advise the trustees on financial and operational constraints as outlined by law. Serve as a member of the administrative team, working closely with the district superintendent and other administrative staff to align the educational goals and financial stability of the district. Assist the trustees in ensuring all district policies comply with local, state and federal laws.

District Clerk Job Description MCA 20-3-325 Amended Must include the following Act as a custodian of all documents, records, and reports of the trustees, including the trustees report required under 20-9-213, MCA. Maintain accurate and detailed accounting records of all financial transactions of the district, serving as a liaison during any financial and labor audits as required. Serves as the election administrator of the district unless the county administers an election at the request of the district.

District Clerk Job Description MCA 20-3-325 Amended Attend trustees meetings and ensure that a permanent record is maintained as required by law, and if unable to attend, ensure a qualified designee maintains an accurate permanent record. All schools will receive one full additional FTE to their QE/QS payment allocation in FY26, no matter the clerk s FTE contract. FY27 quality staff payment will be prorated based on FTE. Independent Contractor s will not qualify for this payment in FY27.

Competitive Pay- Average Pay in Relation to Starting Pay Goal: The starting teacher salary must not be less than 70% of the average teacher pay with the educational entity in the prior fiscal year. This goal is to be obtained over 5 years with a graduating rate. FY26 Starting pay in the fiscal year is not less than 62% of the average teacher pay. Salaries that do not need to be included in this average calculation: Speech Pathologist, Occupational Therapists and other specialized staff Superintendents

Competitive Pay- Average Pay in Relation to Starting Pay Principals District Clerks Unless they have teaching duties set forth in their job descriptions and are licensed as defined in the law. If so, you prorate that portion of their salary into the average. Does not include stipends, bonuses, or extra duty contracts.

Example: School Utopia K-8 FY25 Salaries School Utopia Position K Teaching FTE Salary 1 $ 42,000.00 $ 42,000.00 1 $ 38,500.00 $ 38,500.00 1 $ 46,000.00 $ 46,000.00 1 $ 39,000.00 $ 39,000.00 1 $ 63,000.00 $ 63,000.00 1 $ 51,000.00 $ 51,000.00 1 $ 51,000.00 $ 51,000.00 1 $ 54,000.00 $ 54,000.00 1 $ 42,000.00 $ 42,000.00 0.5 $ 51,000.00 $ 25,500.00 0.5 $ 38,500.00 $ 19,250.00 0.8 $ 33,600.00 $ 26,880.00 1 $ 46,000.00 $ 46,000.00 1 $ 63,000.00 $ 63,000.00 0.1 $ 100,000.00 $ 10,000.00 0 $ 50,000.00 Prorated Salary 1 2 3 4 5 6 7 8 School uses a cooperative for special education specialty positions. Only includes portion of the Superintendents Salary tied to Teaching per contract/job description. Does not include District Clerk unless they also teach and are licensed to do so. What if they have a nurse? Music Art PE Library Counselor Superintendent District Clerk Tota FTE 12.9Total Sal $ 617,130.00 Average $ 47,839.53 62% of Ave 70% of Ave $ 29,660.51 $ 33,487.67

Wait! Utopias First Grade Teacher is an EA. School Utopia Position Teaching FTE Salary Prorated Salary K 1 $ 42,000.00 $ 42,000.00 1 1 $ 38,500.00 EA 2 1 $ 46,000.00 $ 46,000.00 Emergency Authorized are not included in your average. 3 1 $ 39,000.00 $ 39,000.00 4 1 $ 63,000.00 $ 63,000.00 5 1 $ 51,000.00 $ 51,000.00 6 1 $ 51,000.00 $ 51,000.00 7 1 $ 54,000.00 $ 54,000.00 8 1 $ 42,000.00 $ 42,000.00 School Utopia s average changes to $43,330 Music 0.5 $ 51,000.00 $ 25,500.00 Art 0.5 $ 38,500.00 $ 19,250.00 PE 0.8 $ 33,600.00 $ 26,880.00 Library 1 $ 46,000.00 $ 46,000.00 62%- $27,810.12 Counselor 1 $ 63,000.00 $ 63,000.00 Superintendent 0.1 $ 100,000.00 $ 10,000.00 70%- $31,398.53 District Clerk 0 $ 50,000.00 Tota FTE 12.9Total Sal $ 578,630.00 EA s also need not be paid at least the base teacher pay because they are not teachers. Average $ 44,855.04 62% of Ave $ 27,810.12 70% of Ave $ 31,398.53

Minimum Teacher Pay Equates to at Least Eleven times QE/QS Payment Policy and CBA/MOU/Master Agreement Implications: Teacher Base Pay must be indicated in the entity s collective bargaining agreement or a memorandum of understanding executed between the entity and the applicable union if the teachers employment is covered by a collective bargaining agreement pursuant to Title 39, chapter 31, or incorporated in the entity s policy if the teachers employment is not covered by a collective bargaining agreement, not including bonuses, stipends, or extended duty contracts.

Minimum Teacher Pay Equates to at Least Eleven times QE/QS Payment Calculation: State mandated QE/QS payment rate multiplied by eleven (11) QE/QS Payment outlined in 20-9-306, MCA This amount changes every fiscal year based on legislative action (biennium) If your educational entity has met these qualifications, you will receive a double QE/QS payment. FY26 rate: $3,783 Multiplied by 11= $41,613 base salary FY27 rate: $3,896 Multiplied by 11= $42,856 base salary

Whichever Calculation is Greater Compare the following: Average teacher salary multiplied by 70% (62%, 64%....) Eleven (11) times the QE/QS payment set by legislature Whichever is larger is the minimum salary you must pay starting teachers to comply with the STARS act.

Certification of Compliance for FY26 Educational entities will have to submit some form of certification to OPI by May 15 showing that you will meet all qualifications in FY26. I have spoken to OPI staff. They are unsure if this will be in MAEFAIRS or in a Google Form. Is your lowest paid starting teacher making at least eleven (11) times the QE/QS payment for FY26, $41,613?

Certification of Compliance for FY26 Is your lowest paid teacher in FY26 at least 62% of your average teacher pay in 2025? OPI will increase all schools FTE by 1 (district clerk) prior to calculating budgets. OPI will add emergency authorized teachers to educational entities total FTE calculation in the FY26 payment.

Bill Impacts on OPI reports OPI will confirm any increase in general fund by June 1st, 2025 (updated Post Session Preliminary Budget Data Sheets). 20-9-369 pushed to June 1stfor FY25 only final statewide and district guaranteed tax base ratios, for use in calculating the guaranteed tax base aid available for the ensuing school fiscal year; with the final statewide, county, and district mill values per ANB, for use in calculating the guaranteed tax base aid and state advance and reimbursement for school facilities available to counties and districts for the ensuing school fiscal year;

What Happens if You Fall Out of Compliance? If an educational entity qualifies for enhanced quality educator and qualified staff payments under 20-9-324, MCA in a fiscal year, the entity retains that qualification in subsequent years unless the district fails to qualify for 2 consecutive years. After 2 consecutive years of failure to qualify, an educational entity must reestablish eligibility before the enhanced quality educator and qualified staff payments under 20-9-324, MCA resume for the educational entity.

Quality Educator Funding Component Inclusion of District Clerks and Emergency Authorization Staff: Expands the definition of qualified staff to include district clerks and individuals working under emergency authorization. Expands the incentive to Special Education Cooperatives and other organizations that were not able to utilize the former TEACH act. Compliance = Double QE/QS payments.

Advanced Opportunities Program Ensures full funding for programs that provide advanced educational opportunities for students. Funding is no longer limited to legislative appropriations. Districts still must apply and be approved for this program. Must still commit to and comply with all prior reporting requirements of the program. No changes to how the monies are utilized by districts.

Future Ready Funding Component Establishes funding to help students prepare for postgraduation opportunities, including career and technical education beginning in FY 28 based on graduations of students two years prior. Three Goal Levels 1: High school students earning 15 or more CTE equivalent or postsecondary credits prior to graduation. High school district receives 10% of per ANB allocation (FY26 is $8,317) for each student who achieves goal 1. Elementary or K12 that included that same child in their 8thgrade spring count, receives the same.

Future Ready Funding Component 2: High school students earning 30 or more CTE equivalent or postsecondary credits prior to graduation. High school district receives 20% of per ANB allocation (FY26 is $8,317) for each student who achieves goal 1. Elementary or K12 that included that same child in their 8thgrade spring count, receives the same.

Future Ready Funding Component 3: High school students earning an associates level degree. High school district receives 30% of per ANB allocation (FY26 is $8,317) for each student who achieves goal 1. Elementary or K12 that included that same child in their 8thgrade spring count, receives the same. Goals 1 and 2 can be met with any combination of CTE and postsecondary credits.

Future Ready Component Where will you obtain a CTE-equivalent credit list? Annually by December 1stthe Department of Labor and Industry will create a list of industry recognized credentials and worked based experiences with a credit value for each, in 3- credit increments. If an experience or credential is removed from a list, and the student is already enrolled, they may receive credit through the end of the school term. Schools may submit proposed experience or credentialed program.

Future Ready Component How will the postsecondary credits work? Commissioner of Higher Education will provide the OPI and updated list of postsecondary courses of study that high school students are eligible to attend, examination requirements, and transcript credit values.

Housing Cost Budget Authority Increase Provides increased budget authority for school districts in areas with high housing costs to help address these expenses in FY26. Department of Revenue will provide median market values (excluding properties with a market value of $50K or less) report to the OPI no later than December 1 on odd numbered calendar years. OPI shall provide calculations to the maximum general fund budgets of districts on the following July 1. Maximum general fund budget is multiplied by the percentage by which the county median market value exceeds the median county market value for residential properties in the state divided by 60 and rounded to the nearest hundredth of a percent.

Housing Cost Budget Authority Increase Applies to school districts who comply with the STARS act and hold territory within a county in which the median market value for residential properties is greater than 105% of the median county market value for residential properties in the state. Additional budget authority may be used to fund: Housing stipends to employees Construction or purchase of district-owned housing provided for employees Rental assistance, including subsides or discounts on rents on housing for employees

Housing Cost Budget Authority Increase Down-payment assistance, including district provided funds to assist employees with the initial down payment on a primary residence. Shared ownership of housing by the district and employee with an option for the employee to buy the district s interest over time. District guaranteed or subsidized housing loans, including payment of discount points on housing loans secured by an employee. Any other financial assistance to employees authorized by the Internal Revenue Code, the purpose of which is to improve employee access to affordable housing.

Resource Sharing Incentive Beginning in FY27, school districts will each receive a full QE/QS Payment for a parttime employee if: Two or more districts (three or more if one is a unified school system) cooperatively employe an individual who qualifies in definition for Quality Educator/Quality Staff payment. This person must be at least .33 FTE at each of the districts Employment can be made directly or through a multidistrict agreement. Bottom line: If you share a clerk, a counselor, a librarian, nurse, or teacher, etc. you will each get a full 1 FTE QE/QS payment instead of a prorated one.

School Funding Data Dashboard Transparency and Accountability: Requires the creation of a data dashboard to provide transparency and help stakeholders understand school funding. The legislative fiscal analyst will develop this tool. Easily show taxpayers what portion of the school s budget is comprised of local property taxes. Average and base teacher and administrator pay with comparison to national and regional rates.

Defining States Share of School Funding Never specifically outlined in such a manner in state law. Defined as funding distributed to school districts in an equitable manner by the state to support the basic elementary and secondary school system as provided in Article X, section 1(3) of the Montana constitution. Base aid for general fund Retirement GTB to counties to support countywide school retirement Major maintenance aid for the building reserve funds

Defining States Share of School Funding Transportation reimbursements Debt Service assistance Technology funding CTE funding in the miscellaneous fund Advanced Opportunities funding for the flex fund Gifted and Talented funding for miscellaneous fund Other state funding provided by the legislature

Potential Benefits for Montana Public Schools Improved Teacher Retention and Recruitment Enhanced Educational Opportunities Future Ready funding component. Addressing Housing Challenges Increased Transparency and Accountability Legal Definition of the State s Share of School Funding.

Negotiations CBA or Master Agreement Adjustment Provisions Sample language provided by MTSBA The existing matrix shall continue to be in effect for all cells, with the following modifications: Any cell in the salary matrix that is below either Eleven (11) times the QE/QS payment or Seventy percent (70%) of the teacher average pay as defined in 20-9-324, MCA shall be automatically adjusted upward to the higher of the two amounts. Additionally, the district is authorized to and shall ensure that base teacher pay as defined in 20-9- 324, MCA is at least the amount necessary to meet the legislative goals for teacher base pay, in accordance with the provisions of 20-9-324, MCA.

Negotiations If you don t have a union, you still need to update policy to outline your continued compliance. You don t have to make the base cell in your matrix $41,613. Reworking the matrix, condensing etc. Grandfathering in an old matrix, and starting a new one Additional stipends. Remembering that these funds are part of your budget authority and can be used for whatever purpose the Board deems suitable. What options are you using?

Additional Resources MTSBA STARS Act Calculator Large District Version OPI General Fund Spreadsheet HB 252