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Making changes to a state's special education funding formula is a complicated and high-stakes process because of the requirement to maintain state financial support and the guarantee of a free and appropriate public education under the IDEA. We present a three-part framework for politicians and professionals who are responsible for designing state special education funding formulas. The purpose of this framework is to clarify and describe the factors that policymakers need to consider when creating a special education funding formula. By considering the potential impact of each component on local practices, policymakers can review and modify a special education funding formula to align with the requirements of the IDEA and the funding and program priorities of their state.