Dive Brief:
- During the 2020-21 school year, states scaled back pre-K-12 education funding to levels not seen since the 2008 Great Recession, according to a report released Monday by the Education Law Center, a nonprofit that promotes fair and equitable school funding.
- In looking at variations in state spending, ELC found that some states, such as Colorado and Hawaii, significantly reduced the total amount of state and local revenue allocated to districts. Other states like Illinois and New Jersey didn’t implement planned funding increases.
- As states start planning for fiscal year 2025 and as funds run out from the federal COVID-19 emergency payments, ELC urges policymakers to prioritize education funding in an effort to sustain pandemic-era investments in schools.
Dive Insight:
Danielle Farrie, ELC research director and co-author of the report, said one of the big takeaways from this year's annual report is that state funding still shows disparities in equitable and adequate funding, both between states and among school districts within states.
For example, the research showed that among some states, such as Utah, Delaware and Minnesota, per-pupil funding in high-poverty districts is 30% higher than in low-poverty districts. But in some other states, like Oregon and Nevada, high-poverty districts received 30% less per pupil than low-poverty districts.
"A lot of states… fund their education systems regressively so that the students that are in the highest poverty districts actually receive less funding than students in low poverty districts, which is the exact opposite of what all the research and literature tells us students need," Farrie said.
Per-pupil funding varied greatly among states in 2021, from a high of $27,265 in New York to a low of $10,536 in Idaho. The national average was $16,131.
ELC researchers also looked at the effort states are making toward prioritizing school funding by reviewing pre-K-12 revenue as a percentage of the state’s economic activity, or gross domestic product. They found that while New York and West Virginia both rank high in school funding effort, New York, which was relatively wealthy with a high per-capita gross domestic product, was able to have a much higher per-pupil funding level than West Virginia at $16,091.
"If a state has a very low effort, it suggests that it could increase its revenues by increasing the taxes or however to generate more revenue off of the state's economic capacity," Farrie said.
For high-effort states that still aren't generating enough revenue for schools, that suggests there's room for greater federal investments or some other supports, she said.
The report acknowledges that while the 2020-21 school year saw a 3% enrollment decline from fall 2019 to fall 2020, those enrollment losses likely did not affect funding allocations, because state finance formulas typically use a prior year’s enrollment count to set aid levels and are not adjusted mid-year.
