Dive Brief:

• Up to 50 school districts will be able to blend federal, state and local funding sources to create a “student-centered funding” system under a pilot program announced Friday by the U.S. Department of Education.

• Districts have until March 12 to apply for the flexibility if they want to take advantage of it for the 2018-19 school year. The pilot, which is allowed under the Every Student Succeeds Act, requires districts to assign different “weights” — meaning higher funding — to students with greater needs, such as English learners and those from low-income families. 

• “This is a great opportunity for local district leaders to put students first,” Secretary of Education Betsy DeVos said in a press release. “Instead of relying on complex federal rules to allocate funds, local leaders can use this flexibility to match funds — local, state or federal — to the needs of students.”

Dive Insight:

Weighted or student-centered funding models have been gaining popularity in recent years, with liberals saying that it benefits students who need help the most and conservatives arguing that it can increase funding for charter schools. While many states and districts have been trying various forms of weighted models, Matthew Joseph of the Thomas B. Fordham Institute wrote in a 2016 article that “At a minimum, the pilot program should mean that, for the first time, federal dollars will follow the student from school to school within a district.”

An American Institutes for Research review of the weighted formula in Hawaii, which has one statewide school district, found that because of the system, schools with higher proportions of disadvantaged students were now receiving more money. Principals felt that funds were “equitably allocated” and that they had discretion over how funds were used. But many still said they thought the funding overall was insufficient. The researchers concluded that the finance formula had led to “expanded autonomy for school leadership that allows greater flexibility to implement instructional programs that best suit the needs of their unique student populations,” but that there were continuing questions over whether the system allowed for costs to differ based on the geographic location of schools. 

A 2013 "yearbook" on weighted funding formulas from the free market-oriented Reason Foundation ranked the policies in 14 districts and concluded that, in districts that give principals more autonomy over budgeting and staffing, student performance is higher.