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New Data Will Reveal Which Schools Are Winners — and Losers — on School Funding

There are few debates in education as fraught or as important as the fight over how much money to spend on schools — and where to spend it.

Whether a school has the cash to pay for such things as smaller class sizes, extra mental health staff or music instruction depends on decisions made by elected officials at every level of government, from the U.S. House and Senate to local school boards.

Most experts agree that it takes more money to educate students in poverty — including kids who may grapple with trauma in their homes or communities and need more support when they are in school. But in many places across the country, schools that primarily serve low-income families are actually getting less money than schools with more affluent populations.

‘The Promise of Equality’

“How can we fulfill the promise of equality of opportunity in an environment where we know that the students who need the most are getting the least?” said former U.S. Secretary of Education John King, who spoke earlier this month at the National Seminar of the Education Writers Association. “They get less access to resources. They get less access to advanced coursework. They get less access to well-prepared, well-supported teachers.”

But is it a matter of providing resources or requiring accountability and competition? Lawyer Rocco Testani suggested that costly lawsuits don’t solve equity problems but holding school districts accountable and providing competition does.

He compared Florida, which hasn’t substantially increased its school funding, to New York, which has. Testani argues that Florida’s low-cost accountability provisions, as well as strong choice options, led to stronger improvements on the National Assessment for Educational Progress than New York’s.

Funding inequities are evident at the federal level. The largest K-12 funding stream at the U.S. Department of Education is Title I, which is designed to help schools and districts that serve high numbers of poor students. But the formula the government uses to distribute the money does not necessarily send it to the highest need districts, said Nora Gordon of Georgetown University. In fact, affluent districts can rake in federal dollars.

That’s because Title I, funded at more than $15 billion for fiscal 2017, has more than one goal, she said. In addition to redistributing money to poor schools, it is also one of the few tools the federal government has to pressure local districts to change their policies. As a result, almost every district gets some money from Title I. (In addition, the wide distribution of Title I, which reaches virtually every congressional district, has helped to ensure political support.)

Using Title I Aid as a Carrot

“If the federal government wants to get states to do stuff, it needs to have a carrot,” Gordon said. “Title I is that carrot.”

Within states, districts that serve the highest income areas have long had better financed schools because education is often paid in part through local property taxes and wealthy municipalities have higher property values. But over the last several decades, a movement to make school funding more logical and equitable has slowly swept the country.

Beginning with a 1989 Kentucky court case, many states have been changing their funding formulas to send more money to low-income districts, said Diane Schanzenbach, a professor at Northwestern University professor and the director of the Hamilton Project at the Brookings Institution. Since then, spending across the country has increased dramatically.

That policy change has allowed researchers to study a perennial question in education: Whether increasing funding improves schools. In a recent study, Schanzenbach and her colleagues looked at how that infusion of money impacted test scores. They found that when states spent more on schools in low-income districts, the gap in test scores between high- and low-income districts closed.

While many states have changed their funding models to direct more money to poor school districts, there are still gaps in funding within districts, Schanzenbach said. “The bad news is that we found this policy also has pretty limited reach.”

She added, “Although this closes the gaps in funding and test scores between rich and poor districts, it does not do a good job of doing the same across rich and poor students.”

Schanzenbach noted that some districts that serve large numbers of low-income families still may have some schools with a lot of middle class and more affluent families. And money may not flow equally to all of those schools.

The policy of changing state funding formulas “seems to be too blunt to actually get more resources to low-income kids,” Schanzenbach said.

Local funding decisions made at the school board level can lead schools with affluent, politically savvy families to get more money than neighboring schools that serve more low-income families and students of color.

“If you are spending more on one school in a district, you are spending less on another,” said Marguerite Roza of the Edunomics Lab at Georgetown University.

The ‘Motherload’ of New Data

But in many states and communities, information on how much each school receives isn’t publicly available, said Roza. Sometimes schools serving a lot of low-income families get less money. Sometimes they get more. And sometimes there is little rhyme or reason to funding patterns that have developed over years. But Roza added, parents and community members don’t know how the pie is divided because spending decisions often are not transparent or public.

That’s about to change, said Roza. The federal Every Student Succeeds Act (a rewrite of the No Child Left Behind Act) requires districts to report spending by school. That data should start to become available in 2019, she said. Once each school’s budget becomes public, families might put more pressure on districts to give their school its fair share.

“This is the motherload of new financial data,” said Roza. “It will change everything.”



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