School Funding

Public School Funding in the United States

By Youssef Daoud

Focus

The issue of education in the United States is a hotly debated issue in politics. One aspect of education that is always hotly debated is the issue of funding. There is much debate on whether or not schools should receive more funding, who should pick up the tab, whether or not funding is a predictor of academic success, and more. Education funding changes depending on administration, and varies from state to state. So, where does the money come from? Does the amount of money spent impact our learning?

At the end of the lesson:

1. The student will be able to identify sources for public education funding in the United States.

2. The student will be able to determine whether or not funding is a predictor of academic success.

3. The student will learn how local school districts relying on property taxes may perpetuate educational inequality.

Where does the money come from?

Every school needs money to operate. Public school districts need to pay for resources, classroom supplies, academic and extracurricular programs for students, salaries, benefits, maintenance, and more. Funding for school districts comes from the federal government, as well as state and local governments, with the taxes you pay.

Overwhelmingly, state and local governments provide the most funding for public schools. In 2017-2018, federal funding for education accounted for roughly $59 billion, while state governments provided around $357 billion, and local governments provided about $345 billion (National Center for Education Statistics, 2021).

The federal contribution to education funding accounts for only 7.8% of education funding in the United States. State and local government contributions are nearly split, with states providing 46.9% of the budget and local government providing 45.3%. Each state and local governments have their own laws, constitutions, and charters, and each regulates education differently, including spending. Contribution to education funding varies from state to state.

Funding comes from tax revenue the government collects. On the federal and state level, this would come in the form of income taxes. Typically, at the local level, governments will fund their school districts through property taxes. This may cause some funding inequality between more affluent districts and less affluent districts.

Is funding a predictor of academic success?

Many Americans point to increasing academic funding in order to improve student’s academic performance. The idea is to invest more money in schools, which means more money per pupil, and supposedly, a better education. The issue has been hotly debated in politics.

Increased funding benefits schools in a number of ways:

• Smaller class sizes

• Better and more advanced learning technology and equipment

• More resources can be afforded to students

• Retention of high quality teachers (increased teacher salaries)

• Better facilities for students

• Funding for extracurricular programs

• Better educational outcomes and increased performance in students, particularly in minority students.

According to a study by the National Bureau of Economic Research, average standardized math and reading scores correlated with per-pupil spending, with increases in spending seeing higher scores and increases in test scores in the years after a dip in spending (Jackson et al, 2018, Page 25). In another report by the Learning Policy Institute, it was found that increased funding and resources positively correlated with better student outcomes, with a 7% increase in high school graduation rates for all students, 10% for low income students and 2.5% for “non-poor” students (Baker, 2017). Increasing funding for schools with a high rate of low-income students can help narrow the “achievement gap” seen between students of a lower socioeconomic class, as increased spending results in even higher outcomes for low-income students.

There are arguments against this notion, however. Most are centered around increased funding not yielding enough results for the money spent, or that is outright does not help students achieve more. Betsy DeVos, Secretary of Education from 2017 to 2021 under President Donald Trump, argues that throwing more money at the problem won’t help schools. DeVos argued that the Obama Administration’s $7 billion dollar grant program to improve struggling schools, did not have any significant impacts on test scores or graduation rates (Lattimore, 2017). Despite DeVos’s arguments, school funding per pupil clearly correlated with student performance

Inequalities in school funding

Most local districts use property taxes to raise funds. This results in unequal funding between less affluent districts, where a more affluent district can collect more property taxes and thus better education quality for their students compared to less affluent districts. This also perpetuates racial inequality in education by creating an environment with unequal opportunity to succeed. One example of this is in the state of Pennsylvania. According to the Education Law Center, Pennsylvania school districts with the fewest white students spend almost $2,000 less per pupil (Education Law Center, 2017). As seen earlier, more funding correlates to better educational outcomes for students. As a result, there have been calls to find more equitable funding for school districts.

The following video depicts a severely under-funded school in a Detroit public school system. The video highlights the schools lack of resources, dilapidated condition, and inability to retain faculty:

Conclusion

Most funding for public schools in the USA comes from state and local governments, with the federal government only making a small contribution (7.8%, per 2017-2018). Local school districts typically fund public education with property taxes, while state and local governments use income tax. Education funding can be a predictor of academic success. Numerous studies have found that more spending on education per pupil correlates positively with education outcomes. Finally, the use of property taxes perpetuates education and racial inequality. This is due to more affluent districts receiving more funding from higher property values than poorer districts, leading to less funding in poorer districts and worse educational outcomes compared to better funded districts.

Check your learning

1. Who provides the most funding for public education in the USA?

A. Income taxes.

B. State and local governments.

C. School districts.

D. The federal government.

2. How may reliance on property taxes perpetuate educational inequality?

A. Affluent school districts receive more funding than less affluent districts, leading to a lower quality of education for low income school districts.

B. Funding from property taxes goes to districts who need it most, and more affluent districts who pay the most in property taxes lose their share of taxes paid.

C. Property taxes are the best way to fund school districts, and do not lead to inequality in education.

D. School funding among different districts is distributed equally, leading to money taken from more affluent districts that would have otherwise been provided to them.

Answers: B, A.

References

Baker, B. D. (2017, December). How Money Matters for Schools. Retrieved from https://learningpolicyinstitute.org/sites/default/files/product-files/How_Money_Matters_REPORT.pdf.

Education Law Center. (2017, March). Addressing Racial and Class Inequities in Pennsylvania’s School Funding System. Money Matters in Educational Justice. Retrieved from https://elc-pa.org/wp-content/uploads/2017/03/Education-Justice-Report-1.pdf.

Kirabo, J. C. (2018, December). Does School Spending Matter? The New Literature on an Old Question. Retrieved September 27, 2021, from https://www.nber.org/papers/w25368.

Lattimore, Kayla. “DeVos Says More Money Won't Help Schools; Research Says Otherwise.” NPR, NPR, 9 June 2017, https://www.npr.org/sections/ed/2017/06/09/531908094/devos-says-more-money-wont-help-schools-research-says-otherwise

Public School Revenue Sources. (2021). Retrieved September 28, 2021, from https://nces.ed.gov/programs/coe/indicator/cma