Requires the Department of Public Instruction (DPI) to study and propose a change to the formula for State funding for children with disabilities from the current model allocating funding based on required service levels to a model allocating funding based on severity of disability type. Allows contracting with an independent research organization. Requires DPI to examine the six specified topics, including the percentage of children with disabilities and the funding provided per child with a disability for each local school administrative unit, how other states provide funding for children with disabilities, and how to determine appropriate funding levels for each funding category proposed. Requires DPI to report to the specified NCGA committees and division by February 15, 2022, on the study and the proposed new formula for allocating funding for children with disabilities using a tiered model based on severity of disability type.

Appropriates $7,725,690 for 2021-22 from the General Fund to DPI to allocate funds for children with disabilities to local school administrative units for at least 13% of each local school administrative unit's 2021-22 allocated average daily membership in the local school administrative units. Effective July 1, 2021.