We Have to Fix School Funding Formulas, Experts Say, But Where’s the Political Will?

Going to schoolThe U.S. economy has picked up steam recently and the fiscal outlook for individual states is improving. But what impact has this brighter outlook had on the widespread opportunity gaps that continue to plague the education system? So far not much. The lion’s share of a school district’s cash flow comes from local and state sources – a formula heavily reliant on property taxes, making a student’s zip code the principal factor in determining the quality of education.

It’s a funding system that is unique to the United States and that has very few defenders, but mobilizing the political will to restore balance and opportunity to school funding has proven to be an uphill climb.

Exploring the possible rewards and pitfalls of new approaches to education funding was the topic of discussion among policy experts at the Education Writers Association National Seminar in Chicago on April 20. The panel consisted of Kim Anderson, Director of the National Education Association’s Center for Advocacy, David Plank of Policy Analysis for California Education, Marguerite Roza of the Edunomics Lab at Georgetown University, and Natasha Ushomirsky of the Education Trust.

Ushomirsky shared some of the key findings from the Education Trust’s recent report on funding gaps in the United States, which found that due largely to inequitable funding formulas, some of the highest poverty school districts in the nation receive about $1,200 less – roughly 10 percent – per student in state and local funding than the lowest poverty districts. That translates to a shortage of $600,000 per year for a middle school of 500 students and is $1.2 million shortfall for a 1,000-student high school.

“Students who need the most support are given the least,” said Ushomirsky. State budget cuts and plummeting property values caused by the housing crisis hit schools with a “double whammy” that still hobbles schools, especially those in low-income areas, she added.

Some states have made real progress in forging new funding formulas, but Kim Anderson identified three factors that have exacerbated education gaps across the nation – starting with tax giveaways to Big Business.


The highest poverty school districts receive about $1,200 less per student in state and local funding than the lowest poverty districts.

States have attracted large companies by offering massive tax breaks – a policy, Anderson said, that has “failed as a way to promote economic development” while diluting state budgets of critical revenue.

Anderson also pointed to stubborn wage stagnation even as employment picture nationwide has brightened. Family budgets remain tight and children often pay the price with at best limited access to out-of-school activities and supports that can benefit their education.

In addition, some state courts have declared inequitable funding systems unlawful, but these these victories have yielded little in concrete results, as political battles in legislatures have prevented significant progress in most states.

“It takes an enormous amount of political will” said Anderson to remedy these problems in the legislative arena.

David Plank of Education California spoke in detail how Gov. Jerry Brown leveraged that sort of determination in pushing through changes to his state’s funding formula. The legislation – called the Local Control Funding Formula  – replaced what most see as California’s overly complex, inefficient and inequitable K-12 funding system.

“The courts do not have the necessary pull or influence over the legislature so Brown had to take this issue on and lead,” Plank said.

The panelists agreed that the dialogue over school funding can get bogged down in specifics over dollar amounts. Education funding can increase in a specific state, but unless it is distributed fairly and effectively, opportunity gaps will likely not be reduced.

“It’s not about the amount of money, but what the money buys,” Anderson explained.  “We have to serve each and every student’s needs. States have to figure it out.”

Ultimately, said Margerite Roza, “we have to let schools decide how to spend money to best benefit their communities. Just look at the results.”

David Plank worried that a new influx of funding in California could be squandered if local school boards negotiate “bad contracts” and “most money will go to the teachers at the bargaining table.”

Anderson responded that students are at the center of the bargaining table (she pointed out the recent strike in Reynoldsburg, Ohio in which teachers hit the picket line to lower class size in their schools) and that communities, if all stakeholders are empowered in the decision-making process, will produce the best teaching and learning conditions for students.

“If teachers are empowered, if communities are engaged, if decisions are collaboratively made, kids are always going to win.”