September 2015

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State School Aid Payment System
Jerry Coleman, Director, School Finance and Organization
State school aid formula payments are made monthly beginning in August and concluding in April of each school year.  The distribution schedule is established in Century Code at 15.1-27-01 and requires the department to estimate the annual entitlement for each school district for the year. 

The August (10%), September (10%) and October (20%) payments are made based a percentage of those estimates.  In November, the entitlements are recalculated using finalized data and the payments are adjusted so that each district has received 60% their annual amount.  The remaining 40% is distributed evenly over the next five months.

Details supporting the payment can be found in the STate Automated Reporting System (STARS) web application under the Foundation Aid report module.  Access to the report for school district personnel is provided through the district administrator for STARS.  The following reports are available in the system:
  • Payment Voucher.  The payment voucher identifies net entitlement, adjustments, prior payments, the monthly payment and the year to date totals.  Adjustments include payments made on behalf of school districts to special education units (by election) and regional education associations (by statute) as well as other non-routine items such as corrections for reporting errors.
  • Payment Worksheet.  The payment worksheet includes the detail used to calculate the net entitlement for the school district.  This includes average daily membership (ADM), taxable valuation, in-lieu of tax revenue and other statistical information used in the formula.
Payment vouchers for all school districts are published on the NDDPI website on the Foundation Aid Payment Report page along with the payment distribution schedule. 

The payment system is also used to process transportation and student contracts payments.  The system interfaces with the state’s Peoplesoft accounting system and the Bank of North Dakota.  Payments are scheduled to be deposited the first working day of the month. 

Over $900 million was distributed to 201 school districts, special education units and regional education agencies during the 2014-15 school year using this system.