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Budget & Finance

Digging Deeper Into That $300 Million Increase in Federal Aid for Poor Students

By Andrew Ujifusa — April 02, 2018 2 min read
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Lots of federal education programs were winners in the final federal spending levels for fiscal 2018. One of them was Title I, which is earmarked for students from low-income households. The biggest federal pot of cash for K-12, Title I got a $300 million boost, up to $15.8 billion for the rest of the fiscal year. But how exactly will that increase work?

There are four separate formulas that go into Title I funding grants. They’re called basic, concentration, targeted, and education finance incentive grants. The $300 million increase President Donald Trump just signed into law is split evenly between two of those four formulas, with targeted and finance incentive grants each getting $150 million more in fiscal 2018 than fiscal 2017.

Targeted grants provide more money per child as a district’s poverty rate increases, while finance incentive grants are designed to address funding environments in “good finance"—those that spend relatively large amounts on schools and do so equitably—and “bad finance” states. (More in this helpful explanation from the New America Foundation’s EdCentral blog.) Basic and concentration grants both allocate money to districts based on the number of poor students they serve, although concentration grants supplement the basic grants and aren’t available to as many districts as basic grants.

The fiscal 2018 spending levels continue a recent trend, said Julia Martin, the legislative director at Brustein and Manasevit, a legal and consulting firm. She notd that since fiscal 2015, when Republicans began their current run of controlling both chambers of Congress, money for targeted and finance incentive grants has increased, while the basic and concentration grants have held steady:

The total Title I increase for the four formulas from fiscal 2015 to fiscal 2018 amounts to nearly $1.4 billion.

What’s the political context for this? Back in 2015, not too long before Congress passed the Every Student Succeeds Act, federal lawmakers were proposing and debating possible changes to those Title I formulas. One of the proposals, put forward by GOP Rep. Glenn Thompson of Pennsylvania, would have changed the targeted and finance incentive formulas in order to help small and mid-size districts that have relatively high rates of poverty.

Some of those who supported Thompson’s effort think the targeted and finance incentive grants, and the new $300 million increase, don’t treat many rural and smaller districts with concentrated poverty the way they should be. Critics of Thompson’s 2015 proposal, however, argued at the time that larger urban districts, which often have bigger overall numbers of students from low-income backgrounds, would be shortchanged.

In the end, no changes to the four core Title I formulas were made, either as part of ESSA or otherwise.

It’s also important not to exaggerate the impact of disagreements over Title I formulas on how the $300 million in new aid is viewed in much of the education advocacy world, Martin said: “Everybody likes more Title I money.”

Photo: President Donald Trump answers questions as he leaves the Diplomatic Room of the White House in Washington last month, after signing the $1.3 trillion spending bill. (Pablo Martinez Monsivais/AP)