Jeremy Ray serves as superintendent of three school districts in Maine. All three enroll lots of students from low-income families.
But there are some stark differences. Roughly 60 percent of the 2,300 students in the Biddeford district qualify for free and reduced-price meals. By contrast, only 28 percent of the 2,800 students in the Saco district just a mile down the road in southern Maine can say the same.
Maine’s school funding formula offers districts 5 additional cents for every dollar per low-income student. All in all, that works out to schools getting roughly $1,200 more for each low-income students than they do for each higher-income student.
That’s problematic for two reasons in Ray’s eyes: It’s not enough money to pay for the additional support any low-income student would need from their school. And it’s especially not enough money, Ray says, for his schools where most students are from low-income backgrounds.
“A student in a community that has 5 percent free and reduced lunch is still getting the same weight of .05, but that’s a different classroom from one that has 60 percent free and reduced lunch,” Ray said. The latter classroom gets more money, but in Ray’s view, the additional funds don’t make up for the additional needs of students from low-income families in high-poverty areas.
That’s one of the many perennial predicaments policymakers, school district officials, and advocates confront as they strive to provide equitable resources for the nation’s complex, decentralized system of public schools. Even after countless legislative debates, a bevy of constitutional lawsuits in nearly every state, and countless revisions to funding formulas, school funding remains highly inequitable in many places.
But directing more resources, more precisely targeted to the students who most need them, can have a measurable effect on academic achievement for students of color and low-income students, two recently published working papers argue.
One finds that increased school spending approved by local voters can make a strong positive impact on test scores for low-income students and students of color. The other finds significant improvements in student test scores when school principals get more flexibility to spend funds as they see fit for the students in their buildings.
Research findings like these reflect that scholars have firmly moved beyond the long-debated question of whether money matters at all for improving student outcomes, said Chris Candelaria, an assistant professor of public policy and education at Vanderbilt University and a co-author of the latter paper.
“I’m happy to say now that that’s no longer an interesting question,” Candelaria said. “Many people are saying, ‘This is great. Money matters. Now what?”
Scholars study who benefits most when school funding increases
One of the next questions on the minds of school finance observers: For whom does money matter most?
A team of Brown University researchers reviewed school district tax elections in nine states, and school bond elections in eight states where the results were close. The team reasoned that districts where school funding increases just barely passed, or just barely failed, would be similar to each other in terms of wealth and the share of residents who have school-age children.
Over the decade following a successful vote to increase local taxes, test scores among all students, particularly for math, were higher than in districts with failed tax increase votes, the study found. Similar, though slightly smaller, gaps existed between districts with successful bond votes for increased spending on school facilities than in districts where bond votes failed.
Increased spending stemming from a voter-approved funding increase made the biggest impact on test scores in districts where the additional funding was building on a track record of low spending, researchers found. They defined “low spending” as falling below the median per-pupil spending of $11,000 in 2022 dollars, Rauscher said.
Those benefits were visible among students in every racial category except white students.
“In the districts with low previous spending, basically every type of group benefited from passing a bond, whereas in districts with higher previous spending, the benefit was much weaker,” said Emily Rauscher, a sociologist at Brown, one of four researchers who co-wrote the paper.
Those positive impacts come about, Rauscher and her team hypothesize, because of the products of those increased investments: higher teacher salaries and expanded support services from tax increases; upgraded facilities and new technology tools from bonds.
“All legislators should want high performance from students, high rates of academic proficiency,” Rauscher said. “Adequately funding your public schools is one way to get there.”
In Maine, Ray sees disparities between districts as an argument for differentiating funding.
In the lower-poverty districts Ray oversees, many parents “would go to the end of the earth so that X field trip was still in the budget.” But in higher-poverty areas, “we have to be the stronger advocate for our own kids,” Ray said.
By the same token, school officials in low-poverty districts might be tempted to assume that “everybody has the means” to pay fees or approve tax increases that support schools.
Researchers found that test scores aren’t the only measure of student achievement affected by increased funding for high-need students. Researchers used federal civil rights data and district-level attendance data to show that districts with narrowly approved tax increases also subsequently saw decreases in the number of student suspensions and the rate of chronic absenteeism.
“As a community we need to be thinking about how we program and how we support families and create opportunities,” Ray said. “In some communities that’s going to require more funding than others.”
Some districts prioritize equity when deciding how to distribute funds to schools
The difficulty of maximizing investment doesn’t end when funds have made their way from state to district coffers. If states allocate more money to districts with large shares of low-income students, but those districts subsequently direct most of those resources to the individual school campuses with the fewest students from low-income families, efforts to use state funds to improve equity will be stymied.
In recent decades, a growing number of school districts—including large urban ones like Boston, Cleveland, and the District of Columbia—have adopted a system of “student-based budgeting,” also known as “weighted student funding.”
Districts that use this approach develop formulas to determine how much money each student needs. Then, they give school principals more flexibility than is typical to determine how to spend money in the most prudent ways for students in their school buildings.
This model isn’t universally embraced. Many principals lack budget training. Some community members and school staff members balk if the new model means fewer dollars for a particular school building.
Just this school year, Chicago abandoned student-based budgeting in favor of a model that gives every school funding for a minimum level of staffing, as well as additional funds based on a complex formula calculating the community’s particular needs.
The money’s the first part of this. We need to think about how that directly translates into the resources that schools employ.
But a new working paper published in August surfaces some of the first evidence that this approach to funding translates to improved test scores for students.
Candelaria and his colleagues use an unnamed example district in the southeastern United States to demonstrate that students gained one to three months’ worth of additional learning per year in math and reading during the years following the implementation of student-based budgeting. Those gains were particularly pronounced among low-income students and English learners.
A few dozen of the largest of the nation’s 13,000 districts use student-based budgeting, according to a 2021 analysis from the Edunomics Lab at Georgetown University. That number could continue to grow as more big districts jump on board.
In August, Rochester, N.Y., school officials pitched a transition to student-based budgeting. The school board will take a final vote in December.
The model won’t make sense for all districts, Candelaria said. Some have too few campuses to justify shifting the budgeting labor to principals. Some have student populations that vary little from one school to the next, causing little need for substantial differentiation in funding.
But school districts stand to gain considerably from getting budget input from the administrators who are closest to the students’ daily lives and their urgent needs, Candelaria said. He plans to focus future research on determining the kinds of investments that drive the biggest improvements in student achievement.
“The money’s the first part of this,” Candelaria said. “We need to think about how that directly translates into the resources that schools employ.”
