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Secondary CTE Funding Basics

Secondary Career Technical Education (CTE) funding models in the United States are varied and complex. The federal government provides funds to states for secondary CTE under the Carl D. Perkins Career and Technical Education Act, as amended by the Strengthening Career and Technical Education for the 21st Century Act (Perkins V). In FY 2022, Perkins V allocated $1.38 billion to states.

For most states, federal funding alone cannot meet the costs of providing secondary CTE or the demand by learners. States allocate secondary CTE funding to districts in various ways, often based on education funding calculations, historical practices, governance and state-level priorities.

State Secondary CTE Funding Models

To categorize state funding models for FY 2022, Advance CTE used the definitions of foundational and categorical funding and the respective approaches found in State Strategies for Financing Career and Technical Education. A new hybrid funding model definition was added. 

The foundational funding model, otherwise known as basic state aid funding, base funding, general state funding or state aid, is financed out of general state aid formulas that provide no specific earmark for CTE. Local Education Agencies (LEAs) often receive funding that is based on attendance or average daily membership and adjusted for student characteristics, district size and geographic conditions.

Because allocations to LEAs are independent of student participation in CTE, local administrators must decide how funds should be distributed across instructional priorities (which may or may not include CTE).

Just six states (Alaska, Maryland, Nebraska, Oregon, South Dakota and Wisconsin) and the District of Columbia give LEAs discretion on if and how foundational funding is used to support CTE programs and initiatives. Thus, LEAs in these states have discretion to determine whether and how foundational funding is used to support CTE programs and initiatives.

Under the categorical funding model, dedicated state funding for secondary CTE programs is distributed to LEAs to exclusively support and improve CTE. This model consists of three approaches — cost-based, student-based and/or unit-based formulas.

Continue reading for more information about the three approaches for categorical funding:

Under the hybrid funding model, states may implement components of multiple categorical funding approaches or combine an optional categorical funding approach with their foundational funding model. For example, a state may offer optional reimbursements for LEAs, provide funding as competitive grants with different funding formulas, or use two categorical funding approaches. Advance CTE created this new definition to accommodate six states (California, Illinois, Louisiana, Minnesota, Nevada and Utah) that use a hybrid model.

Funding Models by State for FY 2022

Funding Model
States Employing Funding Model

Foundational Funding Model

Alaska, District of Columbia, Maryland, Nebraska, Oregon, South Dakota, Wisconsin

Categorical Funding Model: Cost-Based Approach

Colorado, Maine, New Hampshire, New Jersey, North Dakota, Oklahoma, Rhode Island, Virginia

Categorical Funding Model: Student-Based Approach

Arkansas, Arizona, Connecticut, Florida, Georgia, Hawaii, Indiana, Iowa, Kansas, Kentucky, Michigan, Montana, New Mexico, New York, North Carolina, Ohio, Pennsylvania, South Carolina, Tennessee, Texas, Vermont, West Virginia, Wyoming

Categorical Funding Model: Unit-Based Approach

Alabama, Delaware, Idaho, Massachusetts, Mississippi, Missouri, Washington

Hybrid Funding Model

California, Illinois, Louisiana, Minnesota, Nevada, Utah