Connecting state and local government leaders

Most States Not Spending Enough on Neediest School Districts

Researchers found that “the vast majority of states spend only a fraction of estimated requirements, particularly among their highest-poverty districts.”

Researchers found that “the vast majority of states spend only a fraction of estimated requirements, particularly among their highest-poverty districts.” Shutterstock

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Connecting state and local government leaders

New research found that most states do not allocate resources according to which school districts need it most.

Affluent school districts tend to receive bigger financial support in most states, while high-poverty districts struggle to provide adequate funding for students, according to new research from the Albert Shanker Institute and Rutgers Graduate School of Education.

"In general, resources in most states tend to be allocated non-progressively or even regressively,” researchers wrote in the report, titled “The Adequacy and Fairness of State School Finance Systems.” “That is, higher-poverty districts do not receive more funds—and in some cases receive substantially less—than do lower-poverty districts, even controlling for factors that affect costs, such as regional wage variation, district size, and population density.”

The report, launched in conjunction with a public database of school finance information, measures education spending from both state and local sources based on effort (how much of a state’s total income goes to schools), adequacy (whether the provided resources are sufficient) and progressivity (whether more resources go to the neediest districts). The model attempts to control for differences between jurisdictions to make results comparable across state lines.

Results vary from place to place, and the report does not rank states. But, on the whole, researchers found that “the vast majority of states spend only a fraction of estimated requirements, particularly among their highest-poverty districts.”

To calculate "effort," researchers divided a state’s total education spending by its total gross domestic product, measuring “how much revenue each state spends as a percentage of how much it might spend.” In those terms, effort ranges 5.3 percent in Wyoming and 5.1 percent in Vermont to 2.5 percent in Hawaii and 2.6 percent in Arizona.

Context is important in interpreting those results. For example, California has an effort rating of 2.9, meaning the state spends less than 3 percent of its annual gross state product on education. That’s significantly less than Mississippi, which ranks near the top at 4.9 percent.

But California is a larger state with a better economy and more high-income residents, meaning there’s more revenue to pull from. Low effort there “will have less deleterious implications for education resources,” researchers wrote. On the other hand, Mississippi is trying more, but will not come up with as much resources for districts because of its smaller economy.

To determine adequacy—whether states are providing adequate resources to school districts—researchers divided current education spending figures by the National Education Cost Model estimates of the spending required to achieve national average test scores.

The results identified just five states (Wyoming, New Hampshire, Delaware, Nebraska and Vermont) with “adequate” spending even in high-poverty districts. But of those, only Wyoming had high-poverty districts achieve test scores higher than the national average. The vast majority of states, by contrast, spent far less than required, “including seven states in which actual spending is less than half of the estimated required amount.”

“In other words, in most states, the resources expended by the highest-poverty districts are well below what would be required for these students to perform at average levels, and in some states, actual spending is but a small fraction of the estimated requirement,” the report says.

The goal of the analysis, researchers concluded, is to “make school funding data and analysis more accessible to all stakeholders.” The results are apolitical, but based on a basic understanding that “virtually all of the best policy options require investment.”

“The idea that 'money doesn’t matter' in school funding is no longer defensible,” they wrote.

Kate Elizabeth Queram is a Staff Correspondent for Route Fifty and is based in Washington, D.C.

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