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Every Student Succeeds Act

What Researchers Wish They Knew About School Finance

The field may be swimming in data, but there remain some notable blank spots in assembling a complete picture
By Sterling C. Lloyd & Alex Harwin — June 04, 2019 5 min read
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From the business world to sports to education, analytics are all the rage, as rapidly evolving technology and data systems unleash a flood of new metrics that decisionmakers can use in developing strategies and making choices. But even with the smorgasbord of new information, some potentially important indicators remain unavailable.

That’s certainly true in the education finance arena, where policies are still driven, at least in part, by the unknown and by the lack of detailed data on key topics.

“[School] system leaders often seem unaware of the unintended consequences of long-standing spending practices,” Marguerite Roza, the director of the Edunomics Lab at Georgetown University, and Carrie Stewart, managing director of the Afton Partners consulting firm wrote in an article for AASA, the School Superintendents Association. They suggest that digging into school-level-spending data can help in better understanding these patterns.

Because of regulations under the Every Student Succeeds Act and improving data systems, additional funding data are on the way. But analysts with the Education Week Research Center, who analyze the data that go into Quality Counts, have learned through experience that there is no perfect data set. And no matter how much data are available, researchers and policymakers will always want more.

With that in mind, here’s a sort of researchers’ “wish list” for data that would further enhance any thorough look at the complex issue of school finance.

More Up-to-Date Spending Numbers

This installment of Quality Counts 2019 provides the Education Week Research Center’s school finance analysis, which is the most comprehensive long-standing report available on this topic. To better ensure that analyses are comparable across states, the research center relies on federal data that are collected and reported using uniform standards. But the most recent federal information is typically a few years out-of-date—the latest analysis, for instance, is based on federal data from 2016.

The upside to this approach? The time delay allows the federal government to audit the data provided by state agencies in an effort to improve the quality and consistency. Federal and state officials use the time to discuss anomalies and attempt to correct potential errors in the numbers.

The downside? The Quality Counts 50-state comparisons don’t reflect or reward the most recent funding initiatives adopted by legislatures. They also don’t reflect more-recent big-picture trends, such as changes in the national and regional economy that can affect spending and fiscal policy decisions at the state and local level. And they don’t allow policy adjustments based on anything close to real-time analytics.

Private Donations

The amount of money schools receive from private donations is one example of an area in need of more transparency.

When the Education Week Research Center analyzed private contributions to schools from 2006 to 2014, 10 states did not report complete data on that topic. To make matters worse, three large states—California, New York, and Texas—were among that group, which meant that the analysis could not include 1 in 3 students.

Why would it be useful to shed light on this often nebulous funding source? For one thing, districts have more freedom to spend private dollars for their own priorities. Plus, private contributions, which some districts might use to update technology or science labs, often widen disparities across schools. For instance, the research-center analysis found that the Kohler district in Wisconsin got $863 per pupil in private contributions in 2014 compared with just $27 in the neighboring Sheboygan Falls district. Education Week highlighted a nonprofit funded by Kohler parents that generated more than $30,000 in a single Fall Follies auction. The analysis also identified state-by-state differences in private donations to public schools.

Charter Schools and Districts

Since Minnesota enacted the earliest charter school law in 1991, the number of charter schools and districts has grown substantially. The number of all-charter districts has increased by 24 percent, while the count of regular districts has remained about the same when comparing 2010-11 to 2015-16 data. Despite that growth, some states—such as New York—do not report funding data on all their pure-charter districts in federal databases. How would more finance data on such districts affect state-by-state comparisons of school spending? It’s another unknown that could influence policy decisions.

School-Level Details

Many parents and other stakeholders likely value information on per-pupil spending as an intuitively important reflection of the government’s commitment to their child’s school. As Education Week has reported, these data have many implications. Spending data, when reported at the school level, help the public better understand the degree to which there are disparities between high- and low-poverty schools within the same district, differences in the amount spent in the classroom as opposed to administrative costs or other priorities, and the academic bang for the buck delivered by one school compared with another.

Until recently—despite the inherent and widely grasped value of school-by-school spending numbers—few states publicly reported this information. Instead, per-pupil spending was often published only at the district level. ESSA mandated that states make per-pupil spending figures public at the school level by December. As of Quality Counts’ publication date, the Edunomics Lab at Georgetown University indicates that just 14 states have already done so. Some other states have made slower progress largely because of technical hurdles.

The Education Week Research Center found that in Rhode Island—one of the earliest states to report school-level spending—per-pupil spending ranged from $9,000 to $45,000 across schools in the 2015-16 school year. (The highest-spending was a small, specialized school that houses an early-childhood learning center.) The disparities suggest that the statewide average of $16,000 could mask meaningful differences in the resources available to students and that transparency can help the public better understand potential inequities.

The holy grail? Spending data at the school level that are comparable across all states. It’s a goal that the Interstate Financial Reporting collaborative is working toward.

The move toward additional public reporting promises greater transparency. But even with this initial step, some information on school spending may continue to remain unknown.

Puerto Rico and Other U.S. Territories

The impact of Hurricane Maria on Puerto Rico’s schools has brought new attention to education funding there. Because of data limitations, the research center is not able to compare school finance in U.S. territories to that of states, at least not using an apples-to-apples approach. More information could shed light on challenges and opportunities in these sometimes overlooked places.


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