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Money Makes a Difference in Educational Opportunities

Baker et al. (2018), in their review of recent research on the relationship between school funding and educational opportunity, found an overwhelming number of benefits, including:

• increased school funding leads to greater and more fairly distributed education resources;

  • • states that invest in the resources that matter—low pupil-to-teacher ratios, especially for high poverty districts, and competitive wages— tend to have higher academic outcomes among children from low-income families and smaller income-based achievement gaps;
  • • adequacy-oriented school funding reforms between 1990 and 2011 achieved their goals of improving educational opportunity by raising achievement among students in low-income districts;
  • • school funding reform also leads to improvements far beyond test scores: increased spending led to higher high school graduation rates, greater educational attainment, higher earnings and lower rates of poverty in adulthood.
  • (p- 1)

Jackson et al. (2016) also found that “improved access to resources can profoundly shape the life outcomes of economically disadvantaged children, and thereby significantly reduce the intergenerational transmission of poverty” (p. 212). Of course, in order for school funding to improve outcomes, it must be spent in effective ways to benefit those most in need.

Although we know the many benefits of school funding, such as the ones previously mentioned, and school finance litigation has helped in making progress around economic inequality in U.S., there are still a number of states that have yet to implement finance systems that meet the needs of all students and school funding inequities continue to permeate the education system. Funding itself continues to be unequal among states, ranging from close to $19,000 per student in New York to approximately $6,300 in Idaho (Baker et al., 2018). Moreover, how funding is distributed based on need varies across states with 17 states regressively funding districts in high need, 20 states remaining flat in their funding distribution with no significant differences between funding for high-and low-wealth districts, and only 11 states utilizing a progressive model providing high-need districts with more funding (Baker et al., 2018).

Some states have stepped in to compensate for the school-funding imbalance—Vermont and Hawaii (89% each) are the highest, while South Dakota (30%) and Illinois (24%) are the lowest in state school funding sources (McFarland et al., 2019). Yet, states like Vermont and Hawaii tend to be the exceptions as the public investment in schools continues to decline and local property wealth dictates the level of resources school districts have access to.

There are efforts being made by some states to try to remedy their current school funding levels. For instance, Illinois has long been the frontrunner as the state with the largest inequality in school funding in the U.S. (Morgan & Amerikaner, 2018). However, in summer 2017, the Illinois state legislature finally concluded a long battle over determining a more equitable school funding formula and came to a compromise on a school funding plan. The new school funding plan calculates the amount each district needs to provide an adequate, quality education, and then compares this amount to how much the district can reasonably raise in property taxes to reach the adequate funding threshold. More than half of the districts in the state are unable to raise even half of what they need to provide an adequate education, but 140 districts have more than 100% of the adequate funding they need due to plentiful property tax sources; some districts even have more than twice the adequate funding (Rhodes, 2018). Thus, with the new funding plan the state will funnel supplemental dollars to districts that are unable to meet this educational adequacy metric, and districts in the greatest need will receive more state dollars.

Although school funding experts see Illinois’ new school funding policy as a step in the right direction to funding equalization, and in line with recommendations by scholars such as Darling-Hammond (2019), who encourages states to “focus funding on pupil needs and the costs of meeting the state’s standards” as well as ensuring “flexibility to make locally appropriate, strategic decisions about how to spend resources to achieve results” (p. 24), the metric for this funding formula is adequacy and not equity, and thus may still be insufficient. As we discussed previously, only an adequacy rationale provides the minimum level of funding needed for every school to teach its students. However, due to the long history of policies and structures that denied students of color opportunities to a quality education, it would take more than minimum adequate funding to redress these inequities (Morgan & Amerikaner, 2018; see Rothstein, 2017). Therefore, school funding policies like Illinois are color-evasive because they prioritize a district’s economic inequality and do not consider how a host of racial inequities like racial discrimination in housing, employment, and commerce are key factors contributing to district inequities in financial resources.

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