Budget & Finance

Some School Districts Are Feeling COVID-19 Stimulus Envy

By Mark Lieberman — July 12, 2021 | Corrected: July 13, 2021 11 min read
An old swing-set on a playground at Heritage Elementary School in Lewis Center, OH on July 7, 2021. New construction and repairs will be paid for by a school levy since the district didn’t qualify for pandemic relief funding.
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Corrected: A previous version of this article inaccurately attributed criticism of the federal Title I formula’s approach to measuring poverty.

News headlines about the three federal stimulus packages totaling $192 billion for public schools since the beginning of the pandemic have emphasized their potential to lead to significant academic and other improvements—expanded mental health resources, broader summer school offerings, cleaner air, newer and better technology.

But roughly 1,000, or 8 percent, of U.S. school districts received no money from the December 2020 and March 2021 stimulus packages, known as ESSER II and III, according to an Education Week analysis of stimulus funding allocation estimates from Whiteboard Advisors, an education research and consulting firm. Another 1,600 districts, or 13 percent, received less than $1,000 per student.

Thanks to quirks in the federal Title I formula that governed stimulus allocations, those districts got significantly less than the average allocation of roughly $2,600 per student, according to the Whiteboard Advisors data. As a result, many administrators are feeling a different set of emotions: disappointment and envy.

“When we didn’t get ESSER II and III, my mind exploded,” said Julie Wagner-Feasel, president of the school board for the Olentangy district just outside Columbus, Ohio. The district spends roughly $11,000 per student each year, slightly below the national average. “All of our surrounding school districts received millions of dollars, and pandemic expenses did not stop at our boundaries.”

This spring she also voiced her frustration to the local NBC affiliate.

Districts getting little from federal stimulus aid are asking voters to approve higher taxes, lobbying state and local leaders for supplemental funds to cover ongoing COVID-19-related expenses, and scaling back efforts to academically catch up students coming out of the pandemic.

Some state education departments, including in Connecticut, New Jersey, and Oregon, have directed millions of those stimulus dollars to school districts that fell short of eligibility for emergency aid through Title I.

In many cases, the roots of districts’ discontent lie with longstanding funding challenges that pre-date the pandemic. These districts—many of them in collectively prosperous, rapidly growing suburban areas—are renewing complaints to elected officials and the general public that they’ve long needed more robust and reliable funding.

Low-poverty districts located where state spending has long fallen short, and districts with funding models that rely heavily on volatile state aid, may be more likely to feel stung by a dearth of robust stimulus aid.

“When everyone is hurting, everyone’s going to want to get a piece,” said Bruce Baker, a professor of school finance at Rutgers University.

The Zionsville district in Indiana, for instance, was the only district in the state that got nothing from the last two stimulus packages. Fewer than 5 percent of the district’s families are in poverty, and students from low-income families in other districts clearly have bigger needs, acknowledges Scott Robison, the district’s superintendent. The district spends slightly less than $14,000 per student each year.

Even so, the state’s funding formula has historically offered so little aid to the district that every five to seven years, Robison estimates, the district has to ask voters to approve additional funding through taxes and bonds. If the vote were ever to fail, the district would immediately have to cut 30 percent to 40 percent of staff, he said.

Adding insult to injury for the district, Robison said, Indiana’s state education department chose to allocate a portion of the stimulus funding it received for non-public education to private schools that had no students in poverty, and sent some stimulus dollars to a handful of charter schools that hadn’t opened yet.

“We suggest to legislators constantly that there is a floor at which we have to have funding to be able to have a program year over year,” Robison said.

Major gaps in stimulus allocations have left some districts wanting more

Schools across the country spend anywhere from $5,000 to $30,000 per student annually. School finance experts argue that comparing districts’ stimulus allocations only works alongside a broader understanding of disparities in education funding.

“It’s very easy to look at those numbers in absolute value and say, ‘Well, that number’s a lot bigger, that’s not fair,’” said Jess Gartner, CEO of Allovue, an education finance technology company that has consulted with districts on how to spend stimulus funds. “But what we have to remember is that there’s also decades of accumulated inequity that those dollars have to make up for, in addition to all the disproportionate effects of COVID.”

With those caveats in mind, it’s undeniable that the impact of the stimulus from district to district varies considerably. Slightly more than 1 in 10 districts got more than $5,000 per student. One percent of districts got more than $10,000 per student.

Districts can stretch out the roughly $122 billion from the American Rescue Plan, signed into law by President Joe Biden in March, over the next three years. Just 22 percent of district leaders say they plan to spend funds from the March 2021 stimulus package by the end of the coming fiscal year, according to new research published this week in EdWeek Market Brief. Slightly less than a third say they plan to spend it by the following year, and the rest say they’re either undecided or spending at a later date.

There are some members of the community that are under the impression all school districts got unbelievable amounts of federal money.

Title I prompts gripes from some corners, even as it dispenses much-needed aid

What accounts for these apparent stimulus disparities? It comes down to federal lawmakers’ decision to allocate stimulus aid through the formula for the federal Title I program, which is designed to prioritize students in high-need populations, like students from low-income families and English-language learners.

Title I has in recent years picked up an increasingly vocal contingent of critics, who argue that it punishes schools where state governments are stingy; and that it fails to capture the full scope of high-need students in its effort to target aid to students who benefit most from it.

Only two of the four grant formulas that power Title I achieve the program’s overall goal of directing more per-pupil aid to districts with a large proportion of high-need students, according to a federally funded analysis of the Title I program published in 2019. Larger states, and states that spend less per student on K-12 schools, also tend to get less Title I money, school finance researchers Nora Gordon and Sarah Reber wrote in a recent op-ed for The Hill. The formula’s approach to measuring poverty also tends to be imprecise.

Despite its flaws, the formula proved a convenient vessel for the federal government to rapidly deliver emergency aid. Many districts with a high percentage of Title I-eligible students are seeing a relative windfall that will fuel improvements for years to come.

The Columbus district, which annually spends $11,000 per pupil each year and received more than $8,000 per student in the last two rounds of stimulus aid, plans to spend the money on creating hybrid learning options; literacy programs for older students who are struggling with reading; and HVAC upgrades for a dozen school buildings that currently lack air conditioning.

“We literally could not have provided the level of instruction that ultimately we were able to provide” during the pandemic without the three sets of stimulus aid totaling more than $650 million, said Kathryn Moser, the district’s executive director of leadership and school programs.

The consternation among districts that didn’t receive much or any stimulus aid offers a reminder of the complexity and variety across America’s K-12 landscape. What looks like a massive investment in the aggregate of schools across the country might look very different to an individual school district that’s accountable to its distinct set of community members.
Contributing factors to the varied school finance landscape include local property tax capacity, state-level funding approaches, eligibility for federal aid programs, and broader political and economic headwinds at the regional and national level. Even districts that got substantial stimulus allocations are eyeing steep fiscal challenges to come, as enrollment declines nationwide, cybersecurity concerns mount, and deferred maintenance needs pile up.

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Flawed federal and state funding approaches are entering the spotlight

Few district leaders who are disappointed with their stimulus haul are arguing that other districts deserved less than they got. But some believe at least a portion of the money ought to have been allocated on a per-student basis, rather than looking solely at high-need populations.

The Northshore school district in Washington state, which on average spends $14,000 per student each year, received less than $300 per student from the last two stimulus packages. Michelle Reid, the district’s superintendent, said she considers the Title I allocations an overly “blunt instrument” for figuring out where schools had the costliest needs.

Her district enrolls roughly 3,100 students eligible for Title I aid, out of 24,000 in the district overall. As a result, her district got fewer stimulus dollars per pupil than some smaller districts with the same number of high-need students, because the formula allocates aid based on the proportion of high-need students, not the head count.

“These children, regardless of which district they live in, fall under the same poverty criteria, but we have far less money to support them,” she said.

The Northshore schools had to trim ambitions for summer school and other interventions to address students’ academic and emotional needs coming out of the COVID-19 pandemic, she said. Reid and fellow administrators have also had to temper expectations from the public.

“There are some members of the community that are under the impression all school districts got unbelievable amounts of federal money,” she said.

In Ohio, that problem is compounded by a state funding formula that hasn’t directed more resources toward fast-growing districts like Olentangy, which gets roughly $550 per student from the state and depends on local dollars for the overwhelming majority of its annual per-pupil spending.

The district over the last 30 years has gained roughly 20,000 students and transformed from rural to suburban, During that time, voters have approved bonds to fund the construction of 26 new buildings. In the last decade alone, enrollment has swelled by 9,000 students.

Ohio state lawmakers recently passed a budget with a revised funding formula that will bring an annual increase of several million dollars—more than $100 per student—to Olentangy. Wagner-Feasel is grateful, but also wary—the formula is only funded for the next two years, which will make the five-year planning required annually by the state next to impossible.

Olentangy School District School Board President Julie Wagner-Feasel poses for a portrait in Lewis Center, OH on July 7, 2021. Wagner-Feasel is frustrated by the lack of stimulus funding in the district.

Without stimulus aid, Olentangy administrators had to take funds out of the general budget to cover a deficit in food service expenses that resulted from the disruption of the pandemic. More federal money could also have helped the district expand on its existing contract with Ohio State University for mental health services.

The district, Wagner-Feasel said, served as a vaccination site at the governor’s behest and followed state protocols on reopening buildings while striving to keep students safe during the pandemic.

“Everything that we were asked to do, we did, and we get nothing,” Wagner-Feasel said.

The Zionsville district in Indiana has delayed projects like roof and boiler replacements, and denied principals’ requests for various types of new equipment, in order to prioritize available funds for expanded mental health resources for students.

The ongoing COVID-19 threat has districts wary about more spending to come

The federal government has recently signaled some interest in the plight of districts disadvantaged by state and local funding approaches. President Joe Biden’s federal budget proposal includes $20 billion in grants designed to incentivize states to rethink outdated funding formulas.

Some states, like Ohio and Arizona, provide more funding to affluent districts than ones with a significant percentage of high-need students. Others, like Wisconsin, Tennessee, and Pennsylvania, provide inadequate funding to districts overall, leaving the ones with little capacity for raising property tax revenue at a major disadvantage.

Congress will likely revise Biden’s proposal significantly before passing it. But news of the proposal has already driven discussions in education policy circles about whether an alternative to Title I could be in the cards.

In the meantime, administrators across the country, particularly in areas with low vaccination rates, are eyeing COVID-19 variants and wondering whether more investment in health screenings, masks, and personal protective equipment may be necessary.

This round of COVID relief funding is the first time I can honestly say I feel there’s been an equitable strategy linked to the challenges of urban education in K-12.

In Detroit, a hotspot of severe COVID-19 cases and deaths early in the pandemic, only half the population, and 70 percent of school district employees, have received at least one COVID-19 vaccine dose, said Superintendent Nikolai Vitti. District leaders plan to use federal funds for initiatives to encourage vaccination, and to keep students and staff safe when buildings open this fall.

For a school district where far more than half of students are in poverty, the district’s stimulus haul of $11,000 per student will be crucial to addressing layers of challenges coming out of the pandemic that districts in more affluent areas wouldn’t have, Vitti said. Last year, during a home visit to find students who had gone missing from classes, one mother told him her child had missed school because the family’s home didn’t have heat.

“This round of COVID relief funding is the first time I can honestly say I feel there’s been an equitable strategy linked to the challenges of urban education in K-12,” Vitti said. “The only caveat is: It’s short-term.”

Districts that got stimulus aid are hardly immune from those concerns, either. Moser, in Columbus, said school board members have been asking her whether federal stimulus aid is proving to be adequate for addressing the district’s needs.

“I say, ‘Well that depends,’” she said. “Can you tell me when this pandemic is going to end and if we’re going to have another one?”

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