This section is co-authored by Vice President of Research and Policy, David Schaefer, Director of Economic Justice Ife Finch Floyd and Senior Education Analyst Ashley Young.
The 20-Year View
In 2004, Georgia’s per capita spending on elementary, secondary education and higher education combined was 32nd in the nation; in 2021, it was 42nd. For 20 years, GBPI has continued to advocate for robust funding for K-12 education, including over 15 consecutive years when Georgia failed to financially support public schools to the level established under its own K-12 funding formula. In the last three years, GBPI has helped secure over $200 million for school bus replacement by underscoring student transportation needs. Since 2017, GBPI has also advocated for robust need-based aid for students pursuing higher education, especially as the state has shifted more of the cost of attending college onto students. GBPI achieved a breakthrough in 2022 when $10 million was allocated to the new college completion grants program, a targeted intervention to help students with short-term economic challenges obtain their diplomas.
Georgia’s 2025 Education Funding
Georgia’s Child Care Services and pre-kindergarten programs provide critical support to families and their children. In FY 2025, $72 million was allocated for Child Care Services, $9.3 million more than in FY 2024. The Pre-K program’s budget was $541 million, with legislators providing $25 million for a $2,500 salary increase for certified Pre-K teachers and assistant teachers. Georgia Pre-K providers are reimbursed $25,741 for assistant teacher salaries, which is $5,500 more than last year. Lottery reserves fund Georgia’s Pre-K program.
Alongside Georgia’s programs for very young children, Georgia’s state budget for K-12 public schools is $13.2 billion in FY 2025, a $1.4 billion increase from FY 2024. This includes a $242 million increase in the State Health Benefit Plan (SHBP) employer contribution for certified school employees (teachers, literacy coaches, high school counselors, and administrative leaders). The state stopped paying the employer contribution for non-certified employees (bus drivers, paraprofessionals, custodians and others) in 2012, leaving individual districts paying the cost. However, included in the FY 2025 budget is $53 million in state funds to pay for the SHBP employer contribution for non-certified school employees. The budget also includes language to increase that $53 million in coming years to ensure parity of state funding between the SHBP employer contributions for certified and non-certified employees. Lawmakers also appropriated $368 million to provide a $2,500 raise for certified employees starting September 1, 2024.
The state budget for the University System of Georgia (USG) is $3.4 billion with $3 billion of those funds allocated to USG’s 26 colleges and universities for student instruction. The budget for the Technical College System of Georgia includes programs like adult education, workforce development and a 4% cost-of-living adjustment for eligible staff, totaling $489 million. The lottery funds support higher education programs such as College Completion grants and the HOPE Scholarship. There are currently $1.4 billion in unrestricted reserves and $2.2 billion in total education lottery reserves. In the 2024 legislative session, GBPI advocated for SB 526, the Good Faith Grant, which opened the door to the possibility of using lottery reserves to fund a program of robust need-based aid for students pursuing postsecondary education. The Good Faith Grant builds on the success GBPI achieved in securing college completion grants funding in the FY 2023 budget.
DECAL Budget for FY 2025
The Department of Early Care and Learning (DECAL) administers Child Care Services; the Georgia Pre-Kindergarten Program; Nutrition Services, which administers the federal Child and Adult Care Food Program; the Summer Food Service Program (SFSP) for low-income children in daycare facilities; and Quality Initiatives, which works to improve the quality and accessibility of child care programs. State funds support Child Care Services and the Pre-K Program.
The Fiscal Year (FY) 2025 budget sends $613 million to DECAL and includes about $72 million for the Childcare and Parent Services (CAPS) program, up from $62.5 million in FY 2024. CAPS consists of the state’s child care subsidy program and support for child care providers.
The $9.3 million increase to CAPS is one of the largest increases the program has seen. Much of the investment will be used to increase provider reimbursement to the 60th percentile of the market rate. Before the temporary federal relief funding, the state reimbursed providers at around the 25th percentile, well below the federal standard. The historically low reimbursement rate has made it hard for many child care businesses to invest in their staff and classrooms. While the increase to the 60th percentile is an improvement, it is below the cost of quality care.
Georgia Pre-K Program Receives $100 Million Boost for Teacher Pay, Smaller Class Sizes and More Classrooms
The FY 2025 budget provides a historic increase in state lottery funding for the Georgia Pre-K program to $541 million, about $98 million more than in FY 2024. The final FY 2025 budget includes about $52 million more for pre-K than the Governor’s budget recommendation.
- The additional funding for Georgia Pre-K will be used to increase pay for lead and assistant teachers and bolster the program’s infrastructure; increases include:
- $25 million for a $2,500 increase in base salaries for pre-K lead and assistant teachers.
- $19.4 million to create more salary alignment between pre-K lead and assistant teachers and their K-12 counterparts.
- $9.5 million for the first year of a four-year plan to reduce class sizes from 22 to 20.
- $17.5 million in operation funds to start-up grants for new pre-K classrooms, classroom replenishment grants every five years, and student transportation.
- Start-up operation grants will increase from $8,000 to $30,000 per classroom.
- Replenishment grants provide $15,000 every five years for classroom enhancements.
- Student transportation funding will increase to $80.78 per child for all students.
- $11.5 million in additional operation grants to private Georgia Pre-K providers.
- $9 million for the Summer Transition Program, which provides supplemental support to certain rising pre-K and kindergarten students.
- $243 thousand for state employees’ 4% cost-of-living-adjustment (COLA).
Additionally, SB 233, the private school voucher legislation, included a provision for public schools to consider potential pre-K enrollment for capital outlays. This would support the building or remodeling of pre-K classrooms in public schools.
It’s Time for a Generational Investment in Child Care to Bolster the ECE System for the Next 20 Years
Child care is the foundation of early childhood education (ECE) in Georgia. The child care system often serves as the starting point for children participating in the Pre-K program and eventually entering kindergarten. However, since FY 2004, state child care funding has increased by only 15%, while funding for the Georgia Pre-K program has more than doubled.
The Georgia Pre-K and child care systems are funded differently. The state lottery funds the Georgia Pre-K program almost entirely, and in recent years, lottery revenues have grown. There is also a $1.4 billion unrestricted lottery reserve over and above what is needed to cover HOPE scholarships in a shortfall, which state lawmakers have yet to tap.
Conversely, state general and federal funds cover CAPS. For years, the state has contributed what is minimally required to draw down federal resources, which are also inadequate. CAPS received federal relief dollars to stabilize the system during the pandemic. Those funds end completely in September 2024.
Ultimately, Georgia’s child care system has never had enough funding to help lower costs for most low-to-moderate-income families or reimburse providers at the true cost of quality care. Before DECAL temporarily boosted the CAP subsidies available with federal COVID relief funding, Georgia only served about 18% of eligible children. GBPI analysis found that in all but 17 counties, the cost of care for an infant was more than 7% of a typical family’s income, the federal government’s measure of affordable care. The same analysis found child care costs often take up even more of a typical Black or Latinx family’s income in most counties. [1]
Furthermore, historically low CAPS reimbursement rates contributed to low pay for child care teachers. Zero to three child care teachers typically earn less than Georgia Pre-K lead teachers because their pay is based on tuition and low reimbursement rates. There is also a racial pay disparity as Black ECE teachers are more likely than white ECE teachers to be lead infant toddler teachers.[2] Black teachers often face significant systemic barriers to achieving the bachelor’s degree required to be a higher-paid Georgia Pre-K lead teacher.[3]
The growing costs place greater economic pressure on women, who are often the primary caregivers, even if they are working. A recent survey of Georgia parents found that mothers of young children are likelier to turn down a job opportunity or work less than fathers of young children.[4] A 2018 analysis found that Georgia loses at least $1.75 billion in economic activity annually due to child care challenges.[5]
Georgia needs a generational investment in child care. State lawmakers should amend the state constitution to create a $7.5 billion, self-sustaining Child Care Trust Fund from the billions in the undesignated reserve. If managed similarly to Georgia’s Teacher Retirement System (TRS) and Employee Retirement System (ERS), the Child Care Trust Fund could sustain annual payouts between 5-10% per year to finance and expand high-quality, affordable child care options for families statewide. An initial payout of about 6% would equate to $486 million for CAPS in the first year. A child care trust fund could be the critical foundation for better care and education for children, lower costs for families, higher pay for teachers and a stronger Georgia economy.
State Investment in Pupil Transportation Begins to Address Rising Expenses
Over 930,000 students, around 55% of all K-12 public school students, ride the school bus. To help support those who serve them, lawmakers added $5 million to provide transportation personnel a 4.1% salary increase (in 2023, Georgia school bus drivers were paid 21% below the national average). Lawmakers also appropriated $354 million to support pupil transportation, including $20 million for new school buses. These added funds allow the state to support 40% of school districts’ pupil transportation operating costs. FY 2025 funding builds upon the additional $188 million for school bus replacement provided in the AFY 2022 budget with instructions for it to be used in FY 2022-2024.
Even with pre-FY 2025 transportation personnel salary increases and the AFY 22 infusion included, the state spent less per student in FY 2023 ($117.33) than FY 2002 ($120.73), over two decades prior, not even counting the impact of inflation. Over this 22-year span, the cost of labor, fuel and vehicles have increased—a trend especially stark in FY 2022. School districts, which are required by state law to provide school bus services to students, must find additional funding in other areas. State funding for pupil transportation, like that provided in FY 2025, can help shorten school routes, improve safety and free up more money for the classroom.
Inflation Overtakes Recent Teacher Salary Increases
This year, lawmakers passed a $368 million increase to the state salary schedule for Georgia public school certified employees. The base salary for FY 2025 is $43,592 for 10 months of employment. Governor Kemp has made teacher pay raises a primary education policy goal and successfully led the General Assembly in allocating raises of $3,000 in FY 2020, $2,000 in FY23, $2,000 in FY24 and $2,500 in FY25. The cost of living has increased at a rate that, even with the pay increases, the buying power of the teacher base salary is thousands of dollars less than it was 17 years ago. If salaries kept pace with inflation, teachers paid the base salary in 2024 would have made $7,900 more annually—$395 more per pay period. Georgia ranks 39th in the nation for average teacher starting salary, and 20th for average overall teacher salary. In comparison, Alabama is 23rd and 31st in those same categories; South Carolina is 33rd and 35th; and Florida is 16th and 50th.
Private School Vouchers and Property Tax Exemption Put K-12 Public School Funding at Risk
This year, the General Assembly passed SB 233 (“The Georgia Promise Scholarship Act”), a voucher bill that was conservatively predicted to divert as much as $150 million away from public schools to private schools. Even with adjustments limiting the scholarship to families with incomes below 400% of the poverty line ($125,000 for a family of four; state median income for a family of four is $95,000), the bill will drain millions away from K-12 public schools. Between 2008 and 2022, Georgia’s existing voucher programs diverted $1.3 billion to private schools.
Alongside SB 233, the General Assembly provided for a statewide referendum to cap annual assessment increases for homesteaded property taxes (taxes on the home you live in) at the rate of inflation.[6] Should voters pass this referendum, it will restrict the ability of school districts to fund their local schools. These changes are occurring against the backdrop of federal pandemic-era public school funding that is coming to an end,[7] and Georgia ranks 34th among states for per-pupil funding adequacy.[8] Georgia also underfunded K-12 public education for nearly two decades (fiscal years 2003-2022), a net underfunding of over $10 billion.[9] Consequently, Georgia public schools and students are only now beginning to emerge from a long period of inadequate financial support that fell short of what was provided for by the Quality Basic Education formula.
University System of Georgia/Board of Regents Budget Updates
The 2025 budget for the University System of Georgia (USG) and Board of Regents is $9.7 billion. State general funds allocated to USG’s 26 colleges and universities for student instruction, support services and basic college teaching operations total $3 billion for FY 2025. This teaching budget increased 6% from FY 2024, totaling $204 million. The $9.7 billion total also consists of $1.8 billion in federal grant funding and $1.6 billion in other funds for cooperative extension services, public libraries and research funding initiatives.
- The FY 2025 USG teaching budget includes the following highlights:
- A 4% cost-of-living increase for full-time, benefit-eligible employees at $92 million.
- The employer contribution rate to the Teachers Retirement System (TRS) has increased by $8 million, moving from 19.98% to 20.78%.
- Restoration of the FY 2024 $66 million USG formula funds – because in the 2023 Legislative Session, all 26 USG institutions sustained unique reductions; this detrimental decrease came after a 10% USG system-wide cut of $230 million at the beginning of the COVID-19 pandemic, which was never restored.
- A $22 million increase of employers’ share of health benefits.
Tuition and Fee Rate Updates
The USG tuition rates in the 2024-25 academic year are set to increase for in-state students by 2.5%, and for out-of-state students by 5%. Additionally, a new third-level rate will establish tuition for out-of-country students at 2% more than the rate for out-of-state students. The Board of Regents decided on this increase (after keeping tuition flat for six of the last eight years) due to inflation of goods and services and competition from the private sector for staffing. In the 2023-24 academic year, the average tuition and fees for a public four-year college in Georgia are $8,306, ranking sixth lowest in the country and below the national average of $11,260.
The mandatory fee structure at 20 of USG’s 26 institutions has been increased to cover the growth of online student course delivery. Online enrollment rose 91% from fall 2019 to fall 2022, from 38,929 to 74,525 students. This change includes an online fee equivalent to their institution’s technology fee and a 50% charge of their institution’s mandatory fees.
University System of Georgia’s Disinvestment in Public Higher Education
Obtaining a post-secondary education is critical to obtaining gainful employment. Students who are racially and financially marginalized and lack basic resources are exceptionally vulnerable to policies that do not adequately fund higher education.[10] The USG funding formula provides that education costs be calculated based on credit hour production and shared between the state and students, with the state generally covering 75% and students covering 25%.
Since 2002, USG has reduced its share of student support, resulting in underfunded public higher education. This lack of equitable access to college affects individuals who have been historically excluded from building wealth and unable to afford education. Recent efforts have been made to address the issue, including an increase of $230 million in the FY 2023 budget to eliminate the special institution fee and a budget cut restoration of $66 million in FY 2025. Additionally, there has been a 6% increase in the USG teaching budget. Despite these changes, the state only funds 57% of higher education, 18% less than it would if the USG funding formula were adhered to.
Technical College System of Georgia
The Technical College System of Georgia (TCSG) includes 22 colleges providing technical and core academic education.
The 2025 budget for TCSG is $489 million. Approximately $418 million has been reserved for technical education, which provides funding for workforce development and continuing education or training for youth and adult learners. The rest of the budget has been allocated for Adult Education programs that cater to individuals without a high school diploma, and business initiatives such as Quick Start. Quick Start is a workforce training program that aims to encourage job creation and retention for start-ups, while also supporting business expansion. The Quick Start budget for 2025 is $22 million.
The Technical Education FY 2025 budget includes:
- A 4% cost-of-living increase for full-time, benefit-eligible employees at approximately $10 million.
- A budget of $222,318 to reflect the Teachers Retirement System (TRS) employer contribution rate increase from 19.9% to 20.7%.
- A $9 million funding increase reflects a 3% increase in enrollment.
From fall 2022 to fall 2023, TCSG enrollment grew by 1,770 full-time equivalent (FTE) students. Out of the 22 institutions, 14 experienced an increase in enrollment; one remained flat (North Georgia Technical College); and seven institutions saw a decrease in enrollment.
Technical College System Enrollment Changes
Lottery Funds Support Georgia Pre-K and Post-secondary Programs
Georgia’s lottery funds are constitutionally dedicated to supporting education. In FY 2025, lawmakers designated $1 billion from lottery sales to fund post-secondary education. While the lottery-funded Pre-K program experienced historical budget growth, lottery-funded post-secondary programs saw funding shifts due to inter-program transfers and changes in expected expenditures.
- In Georgia, the Pre-K program helps prepare four-year-old children for success in kindergarten and beyond. In FY 2025, the Pre-K budget increased by $98 million to $541 million, which includes $52 million more for pre-K than was in the Governor’s budget.
- HOPE Scholarships – Public Schools and HOPE Scholarships – Private Schools are merit-based awards provided to students enrolled at public and eligible private four-year institutions in Georgia.
- Changes to the HOPE Scholarships – Public Schools program budget included a $12 million reduction to align funding with expected program expenditures (funding the HOPE Scholarship at a 100% factor rate) and a $17 million transfer from the HOPE Scholarships program for USG schools to the HOPE Grants programs for TCSG institutions. These changes decreased the HOPE Scholarships budget from $875 million to $846 million for FY 2025.
- HOPE Scholarships for Private Institutions decrease from $91 million to $75 million. This is due to reductions in expected program expenditures for the HOPE Private Award rate ($2,496) and HOPE Zell Private Award rate ($2,985).
- HOPE Grants are merit-based awards for students enrolled at public two-year institutions in Georgia. The HOPE Grants program experienced a net $4 million reduction, ($21 million decrease to reflect expected program expenditures and $17 million increase in transfer funds from the HOPE Scholarships for USG institutions). The HOPE Grants program’s FY 2025 total is $77 million, down from $81 million in FY 2024.
- The HOPE High School Equivalency Examination Grant is designed to encourage those taking the High School Equivalency Exam to pursue higher education at eligible post-secondary institutions within the state. Eligible Georgians can be awarded up to $200 to cover GED exam fees. In the fiscal year 2024, the budget for the program was $1.3 million. However, due to a reduction in funds to reflect expected program expenditures of $845,510, the budget for fiscal year 2025 has been reduced to $500,000.
Education Lottery Reserves
The Lottery for Education account is required to maintain a minimum balance, called the shortfall reserve, of 50% of the previous year’s net lottery proceeds. If lottery ticket sales underperform, the state can draw on this reserve to fund HOPE. Once the 50% level is reached, additional reserves are unrestricted. In FY 2023, total education lottery reserves were $2.2 billion, with a $737 million required shortfall reserve and $1.4 billion in unrestricted reserves.
The College Completion Grants Program
In fall 2022, the first College Completion Grants were awarded to students who qualified for financial support to finish their post-secondary education. Four-year and two-year college students who completed at least 80% of their degree program could receive up to $2,500 in College Completion Grants. In the 2023 and 2024 Legislative Sessions, bills were proposed to increase the award amount and to decrease the degree completion threshold from 80% to 70% for four-year programs and from 80% to 45% for two-year programs. Another bill would have extended the College Completion policy sunset year from 2025 to 2027. The College Completion Grants budget remains flat at $10 million for FY 2025. Since 2022, the College Completion Grants program has been making a positive impact across the state:
College Completion Grant 2023-24 Academic Year Highlights
- In FY 2023, 6,891 awards (totaling $7 million) were granted to 6,065 recipients.[11]
- 58% of College Completion Grants recipients earned a certificate, diploma or degree during the 2023 academic year.
- 50% of College Completion Grant recipients were deemed Pell Grant eligible.
- 70% of credentials earned by College Completion Grants recipients were bachelor’s degrees, 14% were associate degrees, and 15% were distributed between certificates and diplomas.
- 27% of recipients simultaneously received a HOPE Scholarship award and a College Completion Grants award, while 7% simultaneously received a Zell Miller Scholarship award and College Completion Grant award.
Endnotes
[1] Finch Floyd, I. (2024, May 21). From Barriers to Bridges: Expanding Access to Child Care and Improving Upward Mobility for Georgia’s Child Care Workers. Georgia Budget and Policy Institute. https://gbpi.org/from-barriers-to-bridges-expanding-access-to-child-care-and-improving-upward-mobility-for-georgias-child-care-workers/.
[2] Georgia State University Andrew Young School of Policy Studies, Bright from the Start, Carl Vinson Institute of Government at the University of Georgia. (June 2016). Economic impact of the early care and education industry in Georgia. Georgia Department of Early Care and Learning. https://www.decal.ga.gov/documents/attachments/EconImpactReport.pdf.
[3] Finch Floyd, I. (2024, May 21). From Barriers to Bridges: Expanding Access to Child Care and Improving Upward Mobility for Georgia’s Child Care Workers. Georgia Budget and Policy Institute. https://gbpi.org/from-barriers-to-bridges-expanding-access-to-child-care-and-improving-upward-mobility-for-georgias-child-care-workers/.
[4] Hart Research. (2024). Meeting the needs of Georgia’s young families. Georgia Early Education Alliance for Ready Students. https://geears.org/wp-content/uploads/HART-RESEARCH-REPORT- PARENT-SURVEY.pdf.
[5] Goldberg, H., Cairl, T. and Cunningham, T. (2018). Opportunities lost; How child care challenges affect Georgia’s workforce and economy. Georgia Early Education Alliance for Ready Students and the Metro Atlanta Chamber. https://geears.org/wp-
[6] Owens, S. (2019, May 23). How does Georgia fund schools? Georgia Budget and Policy Institute. https://gbpi.org/how-does-georgia-fund-schools/
[7] Lefebre, J., & Master, S. (2024, February 28). Expiration of federal K-12 emergency funds could pose challenges to states. Center on Budget and Policy Priorities. https://www.cbpp.org/research/state-budget-and-tax/expiration-of-federal-k-12-emergency-funds-could-pose-challenges-for
[8] Education Law Center. (2023). Making the grade 2023. https://edlawcenter.org/research/making-the-grade-2023
[9] Owens, S. (2022). (Graph: Two decades of underfunding: Cuts to K-12 education FY 2003-FY 2022). https://gbpi.org/wp-content/uploads/2022/01/State-Of-Education-Funding-2-1.png
[10] Postsecondary Value Commission, Voight, M., Dancy, K., DiBenedetto, K., Parker, A. G., Mugglestone, K., Peters, E. E., Roberson, A. J., Voight, M., Engle, J., Rorison, J., Matsudaira, J., Troutman, D., & Addo, F. (2021). Equitable Value: Promoting economic mobility and social justice through postsecondary education. https://www.postsecondaryvalue.org/wp-content/uploads/2021/07/PVC-Final-Report-FINAL-7.2.pdf
[11] Georgia Student Finance Commission. (2023). The Georgia College Completion Grants Program. Retrieved May 1, 2024, from https://gsfc.georgia.gov/about-gsfc/annual-reports.
