Dive Brief:
- Special education initiatives were a priority for several governors in their annual state of state addresses — including in Idaho, Kansas, New Mexico and Pennsylvania — at a time when the national count of students with disabilities continues to rise and as the U.S. Department of Education moves more K-12 responsibilities to the states.
- In Kansas, for instance, Gov. Laura Kelly highlighted the state's $120 million investment in special education programs in recent years during her January speech. Kelly is also proposing $50 million to support students with disabilities in fiscal year 2027.
- States are facing myriad challenges when it comes to overall K-12 public school funding, including a shrinking student population, competition with private school choice, the expiration of federal COVID-19 emergency aid, and state fiscal pressures for early and higher education programs, housing and older adults services.
Dive Insight:
A fall 2025 fiscal survey from the National Association of State Budget Officers found that 23 states projected general fund spending to decline or remain flat in FY 2026 budgets compared to FY 2025 levels.
A separate November 2025 report from Bellwether found 44 states were at "high risk" in at least one of six K-12 financial indicators, such as total revenue to support public education and shifts in enrollment impacting funding levels.
State education funding typically accounts for about 45% of total district funding and typically grows at 2% to 4% each year, according to a September 2025 report from consulting firm McKinsey and Company. "Going forward, however, factors outside of education may influence how and where states choose to spend money," the report said.
Still, even as anxieties swirl around state K-12 funding, some state officials are calling for investments into special education initiatives.
California's Gov. Gavin Newsom's proposed 2026-27 budget calls for an increase of $509 million to help equalize per-pupil special education funding across the state. Newsom's budget summary said the number of students being served by special education increased by 70,000 between 2018-19 and 2024-25, while total student enrollment fell by more than 380,000.
New York's Gov. Kathy Hochul's FY 2027 budget plan recommends fully funding the state’s share of pre-K and summer school special education programs. Under the proposal, the pre-K program would receive a 15.8% increase from last fiscal year for total spending of $1.27 billion. Special education summer school services would see a 5.8% year-over-year increase for a total of $437 million that would be reimbursed to districts.
A New Mexico law signed last week by Gov. Michelle Lujan Grisham would permanently authorize an Office of Special Education to "ensure stability and consistency of services" for students with disabilities, according to the legislation.
