School finance in the 'Quality Counts' spotlight
'Adequate' school funding is gaining traction around the states, but what that goal means depends on the benchmark used

by Mike Rose

School funding was the focus of Education Week’s latest survey of school reform around the states. The “Quality Counts 2005” report, released at a January news conference, details a changing landscape in the debate over school finance. Traditional fights over equitable distribution of state resources are giving way to a push for adequate resources to help all students in all school districts achieve at higher levels. And working hand-in-hand with this trend is a push to make schools, districts and educators accountable for producing gains with the money.

The adequate-financing trend is being spurred by a series of court decisions in states such as Kansas and New York, where judges have found states in violation of constitutional guarantees of adequate public education for all, stresses the report. And “Quality Counts 2005: No Small Change, Targeting Money Toward Student Performance” also illustrates how “the push is on to link education spending to academic results,” thanks to ambitious student performance goals set by states and the No Child Left Behind Act’s mandates for student proficiency in math and reading by 2013-14.

“Increasingly, legislators want to know what it would actually cost to enable all students to meet state standards and how to raise the revenues called for by those calculations,” Education Week editor Virginia B. Edwards told reporters. And those efforts are reinforced in courtrooms where “more often than not, plaintiffs are winning” lawsuits aimed at providing adequate resources for all districts, said Education Week’s Lynn Olson, executive editor of the study. Since 1989, plaintiffs have won almost two-thirds of major school finance cases based on adequacy arguments, the report notes. Courts are finding the traditional focus on equity “is not enough” because it “doesn’t tell you if schools have resources to do the job.” (The school finance battle was featured in “The Funding Divide,” American Teacher, November 2004, available online at www.aft.org/pubs-reports/American_teacher/
nov04/feature.htm.)

Currently, 31 states are considering major changes to their school finance systems, the “Quality Counts” report notes. Thirty states have conducted school finance “adequacy” studies, but there is little agreement on methods to use for calculating adequacy; estimates of adequate per-pupil spending vary wildly depending on which benchmark is used.

The report commissioned Bruce D. Baker, a finance expert at the University of Kansas, to analyze different adequacy formulas used in several states. For example, in Maryland the per-pupil price tag for an adequate public education ranged from $6,820 to $11,107 depending on the method used.

Another key issue revolves around the concept of adequacy as it is applied to such groups as students with disabilities, those with limited English proficiency or those reared in poverty. Forty-three states and the District of Columbia adjust finance formulas to reflect the higher cost of educating these students, and more than half of the states weight funding for at-risk students, those living in poverty or considered more likely to drop out or fail academically. And nine states adjust formulas to reflect cost-of-living differences between urban and rural districts or between regions. “But there’s little evidence that those [weighted] dollar amounts are based on data showing what it actually takes to bring a student from a poor family, for example, to the proficient level on state tests,” the report observes.

Calling the tune

The “Quality Counts” news conference also prompted questions and concerns that any state-led effort to guarantee adequate resources would be difficult to achieve without a matching federal commitment. Costly new testing and reporting requirements, student choice options and other reforms tied to the No Child Left Behind Act of 2001 have not been supported by the money promised when NCLB became law. Federal appropriations for 2005 give NCLB programs $9.6 billion less than amounts authorized by Congress, and Title I funding is $7.7 billion less than was promised under NCLB, leading many to charge that the law is saddling states and districts with huge unfunded mandates at a time when they can least afford to deal with them.

Tight state budgets are forcing schools to do more with less, the “Quality Counts 2005” report finds; adding pressure to state budgets is the fact that “while Title I appropriations certainly have grown, they have slipped below the more aggressive raises suggested” in NCLB. Today, 37 states and the District of Columbia cite a lack of resources or unpredictable funding levels as the most pressing school finance issue.

Budget woes also appear to have put the brakes on efforts to develop new compensation plans. The report finds there has been much discussion, but relatively little action taken by states, when it comes to developing teacher compensation plans that move away from the traditional single-salary schedule. Currently, 20 states have laws mandating a single-salary schedule. Additionally, more than half of all states have recruitment or retention incentives to draw teachers to high-need subject areas or schools.

Six states have created their own pay-for-performance programs based on teacher acquisition of knowledge and skills; and four states (Arizona, Florida, Iowa and New Mexico) have programs that reward teachers based on student achievement and teacher knowledge and skills. But Iowa has only put part of its Career Pathways Program in place because of budget constraints. And Oklahoma’s 15-year-old incentive program exists only on paper due to lack of funding.

“Quality Counts 2005” is supported by a grant from the Pew Charitable Trusts. The report is available at www.edweek.org/qc05.