Dive Brief:

• In examining school finance data from the 2015-16 school year, an April report revealed that the "vast majority" of states aren't spending enough on higher-poverty districts for them to achieve national average test scores. To reach this conclusion, the nonprofit Albert Shanker Institute — endowed by the American Federation of Teachers — and the Rutgers Graduate School of Education used results from three core indicators:
  • Effort, or how much of a state's total resources or capacity are spent directly on K-12
  • Adequacy, or whether school funding is enough for students to hit a minimal level of education outcomes
  • Progressivity, or the comparison of resources between higher- and lower-poverty districts
• Ultimately, researchers found most states were close to average in effort, and the distribution of district revenue across the U.S. is largely not progressive. Additionally, they found that in some states, actual spending is a small chunk of the estimated requirement — deeming it inadequate.
• As a result, the report's authors recommend that more effort is better for states with lower capacity, and allocating more resources to schools, in general, is better. It also notes, however, that districts with more high-needs students should get more support.

Dive Insight:

In recent years, more attention has been drawn to the widespread issues in the school finance system and the problems that occur as a result. It's a known fact that schools and districts, as a whole, have struggled to be adequately funded, and this issue subsequently affects the quality of education a set of students is able to receive. It's also important to note that this issue disproportionately affects lower-income areas and communities, which often need more resources than their more affluent peers — and still aren't given enough support to acquire them. Even when controlling for outside factors, including district size and population density, the report finds that the current state school finance system needs improvement.

"Certainly, there are plenty of contentious debates about how education funds should be spent," the authors write. "But regardless of one’s opinions on specific education policies, virtually all of the options for improving America’s schools require investment — particularly for disadvantaged students."

Things are better now — in many cases, at least — than they have been. After about a decade, state funding amounts have neared pre-recession levels, and in many areas where teachers went on strike in 2018, state education funding has increased.

With more than half of states having budget surpluses, things could be looking up, but there's been sharp debate over whether to use some of the extra money to fund public education or to build up rainy day savings instead. In addition, some state legislatures are debating bills that call for the revamping of school finance formulas, while others are considering policies that could arguably be more reliable, including increasing taxes to fund full-day kindergarten or universal pre-K.

Ultimately, aside from securing more funding as a whole, ensuring greater equity between districts remains key. There have certainly been some positive strides in education funding and school finance formulas, but this recent report adds to the "large and growing body of high-quality empirical research showing that the amount and distribution of school funding has a profound effect on student outcomes," the authors write.