Colorado is cutting funding for its poorest students. The tool meant to replace it was suspended.

By Shaina Cole | Contributing Writer, Rocky Mountain Voice

In Colorado’s smallest school districts, the ones tucked into rural towns, two state programs direct extra money each year to districts based on how many students live in poverty. They are not a lot, but they are specific. They are meant for those kids. And they are going away.

The state is winding down two programs that have directed about $12 million a year to schools serving Colorado’s highest concentrations of low-income students. One program was already repealed when the new fiscal year started. The other drops to half its current level July 1 and is eliminated in FY 2027-28. 

The tool the state built to replace how it counts and funds at-risk students was suspended five weeks ago, after two years of data collection that the state’s own education department said was not complete or reliable enough to compare with existing at-risk data.

There is no replacement in sight.

What the money is for

Colorado sends extra money to schools based on poverty. A student whose family qualifies for free or reduced-price lunch generates additional per-pupil funding for the district, set at 12 percent of the base amount every student receives under the formula now being replaced. 

Districts where low-income students make up a large share of enrollment receive an additional concentration bonus on top of that, calculated based on how far above the statewide average their at-risk percentage runs.

Students qualify through enrollment in federal assistance programs like Medicaid, SNAP, and TANF, through other categorical eligibility including homelessness, foster care, and migrant status, or through the free and reduced-price lunch application itself. That application has likely captured families who are not enrolled in assistance programs. Among them, the state’s education department noted, are undocumented students, who are eligible for the National School Lunch Program and have long been counted through free and reduced-price meal applications.

The two supplemental programs being eliminated were built on top of that formula, targeted specifically at schools with the heaviest load. 

According to a Legislative Council Staff memo, the $5 million additional at-risk program, repealed as of FY 2025-26, was distributed based on the number of at-risk students enrolled. The $7 million supplemental program, phased out through FY 2027-28, goes to districts based on the relative share of at-risk students they serve.

House Bill 25-1320, the 2025 School Finance Act, eliminated both as part of a broader package of adjustments to education funding made under budget pressure that session.

A tool built to replace them

The cuts did not come without a plan. In 2022, the legislature passed House Bill 22-1202, creating a new method for counting at-risk students that would move beyond free-lunch applications. 

The idea was to use census block data tied to each student’s home address, combined with direct certification data from federal assistance programs, to build a more accurate picture of socioeconomic need.

Districts were required to collect that data for two consecutive school years. Training sessions were held. Deadlines were set. The state deadline for the most recent submission was November 10, 2025, per the At-Risk Interchange File Timeline.

Then, on May 7, 2026, Colorado’s Department of Education suspended the collection.

“Given the data reliability issues and the significant data burden on districts,” wrote Jennifer Okes, a CDE district operations special advisor, “the Department has made the determination to suspend the Census Block Data collection beginning with the 2026-2027 school year.”

The suspension memo concluded the data was not sufficiently complete to perform a reasonable comparison with existing at-risk counts.

What the numbers showed

The suspension came after the most recent submission revealed similar problems the state had documented in a pilot project reported in 2024.

Overall, districts obtained census block data for about 94 percent of students. But about one-third of districts could not obtain data for more than a quarter of their students. For small districts, those with fewer than 3,500 students, the number was far worse. They obtained census block data for only 28 percent of their students.

Those are Colorado’s smallest, most rural schools.

The data problems were not just logistical. A March 2024 CDE report had already documented something more troubling about the new counting method itself. When the state’s at-risk working group analyzed nine models, each testing different combinations of potential weighting factors, at-risk student counts went up in all nine. But in eight of the nine models, overall at-risk funding went down.

The reason is built into the design. 

Under the new model, every student in Colorado receives some weighting based on their census block’s socioeconomic status, including students in wealthier communities. 

That inflates the statewide average. 

Concentration grants, the bonus funding that high-need districts depend on, are calculated as the difference between a district’s at-risk percentage and the state average. When the average rises because of low-need districts, that gap shrinks, and high-need districts lose the bonus.

The working group’s modeling, as reported by CDE, found that districts with the highest at-risk populations were unlikely to see significant increases under the new model. They were more likely to see decreases in their at-risk counts. Districts with historically extremely low at-risk populations, by contrast, were likely to see sizable increases.

“It is clear that in its current format the new At-Risk measure, if implemented, could have a devastating impact on the At-Risk funding across the state,” the CDE report said. The report called it “premature and arguably reckless” to implement the measure as it was then planned.

The gap

The legislature did not implement the new measure. But it also did not fix it. It delayed the measure repeatedly since 2022 and in 2025 renamed it from “new” to “improved” without resolving the fundamental problems CDE had identified. CDE eventually suspended the data collection. There is no implementation date.

The supplemental programs built for Colorado’s poorest schools, meanwhile, are going away on a schedule that does not wait. The $5 million program is already gone. The $7 million program hits 50 percent July 1 and will be eliminated in FY 2027-28.

The new formula passed in 2024, HB24-1448, did increase the at-risk factor built into the base formula, from 0.12 to 0.25 per identified student. That is more per-pupil money for each student who qualifies. But the supplemental programs being cut were specifically structured to send additional dollars to schools serving large numbers of at-risk students. 

The per-pupil increase and the concentration programs work differently. Losing one does not replace the other.

Colorado’s at-risk formula was built around students in foster care, students experiencing homelessness, students whose families rely on SNAP or Medicaid or free lunch to get through the week.