On July 21, 2026, Governor Whitmer signed into law Public Act 25 of 2026 (PA 25), amending the State School Aid Act (SSAA). PA 25 highlights include:
- Increased Per Pupil Funding – according to the Senate Fiscal Analysis, the new budget appropriates approximately $19.8 billion for K-12 schools, an approximately $1.5 billion decrease from fiscal year 2025-2026. The foundation allowance, however, rose to $10,300 per pupil, an increase of 2.5% from last fiscal year.
- Weighted Foundation Allowance – PA 25 amends Section 22b to increase funding for at-risk and bilingual education by 20% and creates a new weighted foundation allowance for those student groups.
- Increased Funding for Great Start Readiness Program (GSRP) – PA 25 increases funding for the GSRP target foundation allowance by 10% and includes funding for additional slots.
- Increased Funding for Literacy Teacher Coaches – Section 35a(2)(b) increases funding for ISD literacy coaches. Section 35a(2)(b)(i) states MDE will award each ISD a grant to support the cost of four literacy coaches (up from two in the current SSAA). Section 35(2)(b)(ii) then states that after the distribution in Section 35(2)(b)(i), additional funding will be provided to ensure each ISD receives funding for at least 1 additional literacy coach.
- Modification to Section 163 Penalties – PA 25 amends SSAA Section 163 and the potential state aid penalty for a school that employs an individual without proper certification and includes a cure period. Section 163 now requires that MDE provide notice when an individual is not properly certified. If, after 15 school days, the school has not corrected the problem, the school will be fined $50,000 plus $1,000 for each additional day of noncompliance (up to $100,000 penalty per individual, per assignment, per school year). This replaces the previous penalty, which was equal to 50% of the person’s salary plus a corresponding FTE deduction.
- Modification to Section 164k Requirements – PA 25 adds language requiring a presidential fitness test for all students enrolled in physical education classes; requires schools to comply with Smart Snack Standards regarding selling soda and candy at school; and moves the state aid penalty for failing to adopt state-approved reading curriculum to Section 22b.
Mental Health and School Safety – PA 25 amends Section 31aa’s language related to funding, which will be available in two separate subsections; and revises privilege waiver
- language for a school that experiences a mass casualty event by narrowing the waiver of privilege and the definition of “mass casualty event.” The privilege waiver language that raised significant concerns last year remains, but subsection 6 clarifies the privilege waiver only applies to privileges “held by the district.” For more information about Section 31aa, keep reading to our next article “Section 31aa Update: The Saga Continues”!
- Universal School Breakfast and Lunch Continues – Section 30d allocates funds for public schools to provide free school breakfast and lunch to public school and nonpublic school students in grades pre-K through 12.
If you have questions regarding these or any other SSAA provisions, please contact a Thrun attorney.