The way states fund districts is so complex only a handful of people in any state understand it. District leaders are hamstrung by a multitude of restrictions that lock in antiquated instructional models, preventing them from addressing the unique needs of their students, even when there’s a strong desire to do so.
Education stakeholders deserve to know how and where education funds are being spent. And all students deserve to have an education that is fully funded to meet their unique needs—regardless of whether they attend a traditional public school or a public charter school.
Matthew Joseph, ExcelinEd Funding Policy Director
Too often, debates about state education funding focus solely on how much money should be provided to school districts instead of what impact that money is having on students. In most states, funding is completely disconnected from school performance as well. In fact, the only way school districts can grow their budget is to raise local taxes.
In states across the country, funding for schools is stuck in an industrial model, focused on “inputs” and specific instructional models that no longer work for most students. By changing the way funding is structured—and enhancing its transparency to the public—districts and schools are able to improve and innovate on behalf of students.
Over the past year ExcelinEd discussed K-12 funding with influential state policymakers. The following framework reflects the messages and policies these policymakers find most important for a school funding system that improves outcomes for all students. Additional resources on these topics are also provided.
Policymakers are prepared to invest in schools and understand that some students require more for equal opportunity. However, policymakers want assurances that money will be well spent, which requires rewarding schools that succeed and letting dissatisfied students choose alternatives.
View MoreThe framework is accompanied by a diagnostic tool, allowing policymakers to determine which policies their states are already doing or not doing and providing additional resources to learn more.
Learn More About Funding in Your StateWhen a student moves from one school to another, only a portion of funding follows him or her. This unfairness occurs because states fund specific staffing positions, services, programs, schools and school districts, rather than students.
Also referred to as weighted student funding, student-based allocation or student-based budgeting, student-centered funding means:
When compared to the current systems of big blocks of funding trapped in specific services or programs, student-centered funding is more transparent; it empowers district leaders to use funds to meet the unique needs of their students; it empowers parents to choose the district that is best for their children (with the money following their child); and it’s fairer because all students in your state get the same base resources, with additional funding for students with special needs or disadvantages.
School leaders and parents lack basic information on how much funding comes into a school and how spending on key activities compares to similar schools that are getting better results. Through legislation and executive action, state leaders can promote financial transparency by requiring districts to report, for each school, actual revenue and expenditures per student, including how much they are spending on key instructional activities.
Financial transparency, particularly at the school level, is critical to the success of student-centered funding. It promotes more effective and efficient use of resources by enabling school leaders to identify comparable schools that are getting better student outcomes with the same or less funding. Transparency also promotes student opportunity by empowering parents with information on how much funding a school is receiving per student.
Funding for schools is currently based on inputs, regardless of how well schools do. But performance funding in K-12 education can incentivize results. Examples include rewarding schools when they succeed with at-risk student populations or when their graduates get a decent paying job, succeed in college or enlist in the military. Performance funding is effective because:
Developed with the help of Dr. Larry Miller, the nation’s foremost expert on K-12 performance funding, the Performance Funding Issue Brief and Modeling Tool shows real results. When performance funding is high compared to the overall proportion of funding, student success is higher. Learning gains are even more significant for at-risk students, where extra funding for their success can narrow achievement gaps.
Most state education funding systems do not fairly fund all students across all choice options, particularly public charter schools. This reality is stifling the growth of existing charter schools and limiting the expansion of new quality public school options. ExcelinEd has developed a methodology called the Charter Facility Index by which states can assess whether they are addressing the full facility needs of charter schools. The index outlines three policy areas states can leverage:
With any of these policies, magnitude matters. A major investment in one tool may reduce the need for another and it takes a combination of tools to fully address the facility needs of charter schools in a state. If many charter schools can access free facilities, fewer charter schools need funding for rent.