School Funding Fairness Suffers Amid National Recession

NEWARK, February 5, 2014 -- The 3rd Edition of Is School Funding Fair? A National Report Card details how the Great Recession and its aftermath have affected school funding in the states.

The Great Recession triggered dramatic reductions in state and local revenue from property, sales and income taxes. To prevent layoffs and cuts to education programs, the federal government provided substantial stimulus funds on a temporary basis. When the stimulus ended, however, states faced a crucial test: either restore revenue or allow cuts to education funding and programs. This report shows many of the states failed this test, sacrificing fair school funding after the foreseeable loss of federal stimulus.

The National Report Card (NRC) examines each state's level of commitment to equal educational opportunity, regardless of a student's background, family income, or where she or he attends school. Providing fair school funding -- at a sufficient level with additional funds to meet needs generated by poverty -- is crucial if all students are to be afforded the opportunity to learn and be successful.

The NRC evaluates all 50 states and the District of Columbia on four separate, but interrelated, funding "fairness indicators" -- funding level, distribution, state fiscal effort, and coverage.

The 3rd Edition of the NRC finds:

  • School funding in 2011 was largely stagnant or declining in many states. About half of the states cut funding from 2010 levels, and in fourteen states per-pupil spending in 2011 was below 2007 levels, even without adjusting for inflation.
  • Reversing a positive trend, the number of states classified as "progressive" -- that is, they provide more funds as district poverty increases -- dropped between 2010 and 2011. Several of the fourteen "progressive" states reduced funding to high poverty districts. New Jersey, for example, lowered the funding boost for poor districts from 42% in 2009 to a mere 7% in 2011. In Utah, the funding boost was cut in half from 59% in 2009 to 24% in 2011.
  • Many states reduced their investment in K-12 public education in 2011. All but three states lowered their fiscal effort on education between 2010 and 2011, when they faced the fiscal cliff created by the loss of federal stimulus funds.

The 3rd Edition of the NRC also explores the relationship between school funding and three essential resources: early childhood education, pupil-to-teacher ratios, and teacher wage competitiveness. The report shows that states with fair school funding tend to provide more support for early childhood education and are better able to provide competitive compensation for teachers and maintain student to staff ratios that are adequate to meet the needs of diverse student populations.

As in previous editions of the NRC, school funding in most states remains remarkably unfair, as these latest findings demonstrate:

  • The disparities in funding among states are vast, with average per pupil funding ranging from $6,753 in Idaho, to $17,397 in Wyoming. In six states (Tennessee, Mississippi, Oklahoma, Arizona, Utah, Idaho), average funding levels are below $8,000 per pupil.
  • The majority of states have flat or regressive funding distribution patterns that ignore the need for additional funding in high poverty settings. Even among "progressive" states, only eight provide more than a 10% boost to high poverty districts. In the five most regressive states (North Dakota, Vermont, New Hampshire, North Carolina, Nevada), the poorest districts receive at least 20% less funding than higher wealth districts.
  • States making the strongest effort to fund public education devote more than 4.5% of their economic productivity to schools (Vermont, New Jersey, New York), while the lowest effort states (Oregon, South Dakota, Delaware) allocate 2.5% or less.
  • The extent to which school-aged children do not attend public schools raises a red flag in a number of states. In Delaware, Hawaii, Louisiana, and Washington, D.C. approximately 20% of children do not attend public schools, and the average household income of these children is often dramatically higher than that of their public school peers. Household incomes of non-public school families in Louisiana, Tennessee, Texas, and the District of Columbia are as much as two to three times higher than in the case of public school families. These data point to a potential lack of political and community support for fairly financing public education in these states.

"As this National Report Card shows, most states did not step up when the federal stimulus dried up. Instead, they cut education funding, eroding fairness in some states and further retreating from that goal in others," said David Sciarra, Education Law Center Executive Director and NRC co-author. "These latest results show school finance in most states is decidedly unfair, a condition which deprives equal educational opportunity to millions of public school children across the nation."

“This year’s National Report Card confirms that states across the country are failing to adequately and equitably invest in children,” said Wade Henderson, president and CEO of The Leadership Conference on Human and Civil Rights in Washington, D.C. “A tough economy is no excuse to deny an adequate education to students, regardless of their race, disability status, income, or zip code. This report also offers proof that states can do better when they prioritize students over politics.”

Is School Funding Fair? A National Report Card is coauthored by Bruce Baker of the Rutgers Graduate School of Education; David Sciarra, Executive Director of Education Law Center (ELC); and Danielle Farrie, ELC Research Director.

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