School Finance

New data will reveal which schools are winners — and losers — in the school funding fight

PHOTO: Alan Petersime

This story was originally published in the Educated Reporter, a blog from the Education Writers Association. It is a report from the National Seminar of the Education Writers Association.

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.”

Investment strategy

Here are the initiatives Memphis’ education philanthropists will focus on in 2018

PHOTO: Matt Detrich/The Indianapolis Star
A charter leader from Indianapolis, Marcus Robinson is now CEO of the Memphis Education Fund, a philanthropic collaborative that invests in education improvement initiatives for Memphis schools.

A Memphis philanthropic group has shed its “Teacher Town” name but still plans to spend this year recruiting new teachers while also investing in growing the city’s single-site charter operators.

Unlike similar organizations in other cities across the country, the Memphis Education Fund plans to center its search locally — by helping local universities and groups prepare teachers for the challenges of urban education.

Originally called Teacher Town, the fund was created in 2014 by Memphis education leaders and local philanthropists with a goal of transforming Memphis into a destination city for talented teachers. That vision built on a major investment by the Bill & Melinda Gates Foundation to improve teaching in the city.

In 2016, the group adopted a broader goal of improving all schools; brought in a new leader, Marcus Robinson, from Indianapolis; and joined Education Cities, a national collective of local groups seeking to reshape schools in their cities

In part inspired by changes that have taken place in Indianapolis, where Robinson had worked as a charter leader, Education Cities coordinates local groups advocating for the “portfolio model,” a vision in which cities have more charter schools and let district schools operate more like charters.

Robinson told Education Cities a year ago that his next step for Memphis would be “to unite everyone around a common set of operating principles, expectations, and evaluations to create a level playing field for each operator to perform optimally.” This appears to be in line with the portfolio vision, which aims to give all schools flexibility to operate as they see fit, while holding them equally accountability for results.

But instead of bringing the Shelby County Schools district and local charter operators closer together, 2017 saw them waging open competition for students.

For 2018, Robinson is tackling priorities that are not likely to inflame divisions. The fund will continue to focus on principal training, along with helping single-site charter organizations, boosting reading skills among the city’s youngest students, and recruiting new Memphis teachers.

“We’re hell-bent to fill classrooms with teachers,” said Robinson, pointing to elementary schools as having some of the greatest need.

Memphis will need an estimated 3,600 new teachers by 2020, said Lesley Brown, who directs how the fund invests its money to attract, develop and retain talent for local schools.

Rather than recruiting teachers from outside of Memphis, Teacher Town’s original focus, Robinson said the fund is strengthening partnerships with local universities and teacher preparation programs, such as one launched at Rhodes College in 2016 with the help of a $7 million gift from the fund.

The Memphis Education Fund receives support from several local philanthropies, including The Pyramid Peak Foundation and the Hyde Foundation. (Chalkbeat also receives support from Hyde; read about our funding here.)

Robinson added that the fund also is ramping up its support for single-site charter operators, such as helping teachers implement new literacy curriculum at Memphis Delta Preparatory Charter School and STAR Academy Charter School.

“There’s less of an appetite for national charter organizations to move into Memphis,” he said. ”The next phase isn’t national CMOs (charter management organizations), but how do we encourage single-site schools to evolve.”

The group has doled out such grants to charters as part of a larger effort to boost student reading levels and develop teacher training for Core Knowledge Language Arts and KIPP Wheatley.

“Early literacy is a huge focus,” Robinson told Chalkbeat. “When we look at the test scores, early elementary scores are horrific. What’s the root? Access to quality literacy instruction.”

Paying for school

Sweeping study proposes major changes to the way schools are funded in Michigan

Michigan needs to change the way it funds education so that schools get more money for students who need extra attention — such as those who live in poverty and those who don’t yet have a strong command of the English language.

That’s the top recommendation from a prominent group of educators, policymakers, and business leaders who have been studying Michigan’s school funding system for much of the past two years.

While many states use a complex formula that gives schools more money if they serve children facing extra challenges, Michigan has long used a system that distributes the same amount of money for virtually all students, regardless of their needs.

The state provides some extra funding for students with disabilities — but not nearly enough, according to a state study last year that found schools across Michigan are getting $700 million less a year than they need to serve those students.

The study released Wednesday recommends a major restructuring so that schools would be fully funded for special education programs and would get extra funds to provide resources to students who need extra help. With that money, schools could offer lower class sizes, add counselors and social workers, and give teachers more support, the report says.

The study was conducted by Augenblick, Palaich and Associates on behalf of the Michigan School Finance Research Collaborative.

The collaborative — including top business and education leaders across the state — came together in 2016 after an earlier “school adequacy study” was largely ignored by political leaders.

The earlier study, which was funded by the state legislature, recommended that the state significantly increase the amount of money it sends to schools per student.

The collaborative hopes this new more robust study, which clocks in at more than 300 data-packed pages, will have a greater impact.

Since this study used multiple methods to determine the right funding level for schools, it will be more difficult to ignore, the group hopes.

The study — paid for with $843,000 from major foundations and 18 county school districts — included interviews with hundreds of educators, including district and charters school teachers. Those interviews helped researchers determine how much money schools need to more effectively do their jobs.

The study examined geographic cost differences in different parts of the state, labor cost differences, and other factors and determined that schools need approximately $9,590 each for students who don’t have special needs, including funds that would come from the state and federal governments.

The study recommends that schools get 35 percent more for students living in poverty, between 50 and 70 percent more for students who are learning English, 70 percent more for students with mild disabilities and 115 percent more for students with moderate disabilities.

Among other recommendations in the  report is that charter schools receive the same per-student funding as districts. Currently, the state’s funding system pays some districts more per student than others based largely on historic funding levels as opposed to current needs. Some districts — including most charter schools — are currently getting around $7,600 per child from the state while others get thousands of dollars more

It’s difficult to compare how much funding schools are getting now with the proposed $9,590 per student because schools get a mix state and federal dollars and the $9,590 doesn’t include things like transportation dollars.

The report suggests that the state use a new approach to student transportation in which transportation dollars are distributed differently, taking into account differences between urban and rural school districts.

The report did not put a price tag on the cost of implementing the recommendations and did not spell out how Michigan could come up with the extra money. But members of the collaborative said they hope lawmakers will consider the report as they make policy changes. 

“The issue here is not about whether you live in Farmington or whether you live in Ingham County, it’s about every child ought to have the opportunity to be successful and that ought to be our goal in Michigan,” said Randy Liepa, the Superintendent of Wayne County’s intermediate school district. “I don’t think there will be significant pushback on that.”

The findings were released Wednesday morning, with press conferences planned in Lansing, Grand Rapids, and in the Detroit area.

Read the full report here: