Budget & Finance

Your Guide to ESSA’s New School-by-School Spending Mandate

By Daarel Burnette II — October 08, 2019 5 min read

For decades, “per-pupil spending” has been the public’s main lens on how $700 billion in K-12 funding gets spread around at the school district level. But experts have long argued the yardstick does little to illuminate districts’ academic and financial priorities or spending inequities.

The Every Student Succeeds Act, passed in 2015, requires states for the first time to break out how much districts spend on each school. Advocates hope such detailed data will revolutionize the public’s understanding of K-12 finance and drive academic- and fiscal-policy shifts at the state, federal, and local levels.

It could also land like a dud and confuse the public even more about how taxpayers’ dollars are distributed. A recent survey conducted by the Education Week Research Center found that more than 67 percent of district administrators and principals don’t believe that ESSA’s requirement for public reporting of school-level spending will lead to more equitable spending.

Either way, the flood of new district spending data is coming. While U.S. Secretary of Education Betsy DeVos set a deadline of this school year for states to display the information to the public, 17 states so far have already released the information.

See Also: Special Report: Managing the Money

It’s become apparent, though, that as with other kinds of data dumps—such as the competing array of student-test scores and -performance rankings—school spending numbers can be misinterpreted or even exploited to serve particular policy agendas.

With all that in mind, here’s a guide to what ESSA’s new data-reporting mandate means for different players in the education community. It’s based on interviews with advocates, researchers, and practitioners in states that have already released the numbers and national experts who have worked with such data in the past.

What’s Required?

The Every Student Succeeds Act says states must report to the public each school’s annual per-pupil-spending amount and how much districts spend on overhead costs. Though the law was passed in 2015, the U.S. Department of Education set the reporting deadline for summer 2020 because states and districts complained they needed time to figure out how to collect the data.

Who’s Reporting So Far?

According to Edunomics, a research lab based at Georgetown University, 17 states had reported school-level-spending numbers as of the end of September: Alabama, Colorado, Delaware, Florida, Georgia, Kentucky, Louisiana, Massachusetts, Minnesota, Mississippi, Nevada, Ohio, Rhode Island, Texas, Washington, West Virginia, and Wyoming.

What It Means for These Groups

Superintendents, CFOs, and Other Administrators

• They’ll be asked to defend spending differences between schools by state officials, school board members, principals, teachers, parents, and others.

• Questions to answer: Is the spending adequate and equitable? Are funds being spent as intended? Is the district investing its money in its most academically struggling schools? What could other schools in the district learn from schools with high outcomes and low costs?

• Districts with dramatic enrollment fluctuations could use school spending numbers to better determine if their limited dollars are being spent efficiently. That analysis could be used as a tool to evaluate which schools to expand and which to close.

• The detailed data ask will require plenty more work for already-strapped district- and school-level finance and clerical staff.

Teachers

• Unions could use the school spending numbers in negotiations to argue for higher teacher pay or a reorganization of district resources.

• Teachers will have detailed data to back them up in demanding to know if the district is spending too much or too little on administrative overhead.

• Because 60 percent to 80 percent of a school’s budget goes into teacher pay, teachers may be forced to defend districts’ teacher-salary and school placement methods.

Principals

• As the administrators on the front lines—and often the most-trusted people in districts—principals could be tasked with explaining and defending school spending numbers to parents, advocates, and school board members.

• If there are big spending disparities between schools, principals could use those numbers to advocate for more leverage in the budget process and in making sure each school gets a fair share of the funding.

Parents

• Since school spending numbers will be included on district report cards, parents could use the numbers as a factor in determining where their child should go to school.

• Parents could end up grilling administrators and school board members on whether the amount being invested in their child’s school is enough.

• Parents of children with disabilities could use the school spending data to highlight which schools spend the most on special education and have the most robust programs.

Local School Boards

• Since they often have final say over the budget, board members will be on the hook to explain to constituents why the district distributes its resources the way it does.

• During budget hearings, board members can use school spending numbers to question why administrators chose to invest money in some schools and not in others.

• Board members can check to see if their school spending lines up with their districts’ academic priorities.

Advocates and Local Media

• School funding advocates and local reporters could use the spending data to question the validity and effectiveness of states’ funding formulas or the way districts distribute those resources.

• While states are often reluctant to directly pair spending data with academic data, advocacy and media organizations will now have the information to do so themselves. That could lead to more robust community discussions about how districts spend their money.

State Policymakers

• Legislators and governors will have new information in evaluating whether state dollars are being distributed by districts as intended and whether districts should have more or less freedom to spend state school aid as they’d like.

• The numbers could increase state scrutiny on low-performing districts and whether they are investing properly in their most academically struggling schools.

Cautions

Researchers and school finance experts warn that users of the data could draw false or misleading conclusions from the information.

For instance, while research shows that more money can, in fact, align with higher achievement, it’s much less conclusive about how districts should spend their money to boost test scores or how much such an endeavor would cost.

Advice: Be cautious in drawing conclusions from the bottom line alone. By themselves, school-by-school spending figures won’t capture a range of other factors that can be crucial to a school’s performance, the challenges it faces, and built-in costs. Those can include the special needs of that school’s student body and even things like geography and transportation that can drive up expenses.

A version of this article appeared in the October 09, 2019 edition of Education Week as Your Guide to ESSA’s New School-by-School Spending Mandate

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