October 21st, 2011

DISCUSS: What Is The Most Effective Model For School Funding?




How should school funding work, ideally? We convened several experts to discuss. You may also be interested in our report for PBS NewsHour on budget cuts in central PA, which is embedded above.


Steve Peha, Teaching That Makes Sense

It’s not about money; it’s about how we spend it

Steve Peha is the President of Teaching That Makes Sense, an education consultancy in Carrboro, NC specializing in literacy, assessment, and school leadership. Since 1995, he has taught in thousands of classrooms and hundreds of schools across the United States and Canada.

In a contracting economic universe, the best solution to improving productivity is to lower cost, increase efficiency, or both. In education, lowering costs is probably a non-starter. True, research shows that we could fire a few more teachers and raise class sizes a little higher without lowering student achievement. But it’s important to remember that we have set ourselves the task of improving achievement dramatically in the coming years.

So that leaves improving efficiency. Specifically, we need to answer this question, “How do we assure that more kids learn more things in less time?” The answer, surprisingly, is pretty simple: change the way we teach. Right now in the US, we use many of the least efficient teaching methods possible for basic skills like phonics, spelling, early math, and writing instruction. By sharing across classrooms, schools, and homes, a small repertoire of proven, re-usable, cross-grade, content-neutral, “learning patterns”, we could improve the efficiency of teaching and learning even with more kids in each class, fewer para-educators, and the current and much-derided, too-short “agricultural” school schedule.

It’s not about money; it’s about how we spend it. It costs nothing more to teach well than it does to teach poorly. With small changes in the instruction of critical curriculum, and materials delivered free over the Internet, we could make extraordinary gains even with severely limited financial resources.


Noelle Ellerson, AASA

Remain focused on formula, flexible funding

Noelle Ellerson is the Assistant Director, Policy Analysis & Advocacy at the American Association of School Administrators.

Writing from a federal advocacy point of view, one of the most effective things that the federal government could do to support the tough, crucial decisions that state and local education agencies have to make about education funding is to remain committed to providing formula, flexible funding. Flexibility in funding can be as good as new money, and we all know there won’t be a whole lot of new money from the federal level. And what new money there is will likely come through competitive grant programs. While there is a place for competition in education, it puts small, rural and poorer schools at a disadvantage — as they often lack the capacity/man power required to put a grant together. AASA strongly believes the federal government needs to meet its commitment to properly funding Title I and IDEA — programs designed to level the playing field for disadvantaged students — before defaulting to a federal funding policy reliant on competition, which creates a system of winners and losers.

Formula, flexible dollars drive the limited federal dollars to states and locals in a manner that provides funding to as many schools as possible, without asking the schools to jump through hoops or divert resources that would otherwise go toward instruction to compiling a grant application, instead. What does this look like at the local level? Increased flexibility means schools would be able to move funding within and between programs, leveraging what might be several small pots of funding as one. It would free locals from heavily prescriptive federal spending restrictions, and allow schools to put the funds toward the projects, investments and curricular improvements the district actually needs.


Renee Moore, Teacher

There is no justification for inequality

Renee Moore has taught English and journalism for 20 years in the Mississippi Delta region at both high school and community college levels. She is National Board Certified, a former state Teacher of the Year, and a co-author of TEACHING 2030: What We Must Do for Our Students and Our Public Schools… Now and in the Future.

In her blog, Robin Lambert of Rural School and Community Trust reveals important information from the National Center for Education Statistics (NCES):

Eighty-seven percent (87%) of African American and 79% of American Indian/Native Alaskan students attend a moderate to high poverty remote rural school, compared to 78% and 62%, respectively, in cities. In fact, more than three-quarters of African American students and nearly half of American Indian/Native Alaskan students attend remote rural schools where more than 75% of students qualify for free or reduced-price lunches.

I have spent my entire teaching career in rural, predominantly African-American schools, where 90-100% of students qualified for free or reduced lunch. These schools are in districts that have little or no industry and few retail businesses; in some, the school district itself is the largest employer. Most of the school districts here in the Mississippi Delta get less than 20% (most less than 15%) of their operating funds from local revenues, and more than 25% from federal funds. Were it not for the state and federal funds these schools receive, the children in such districts could receive no public education at all.

But what is the quality of that education?

In our book TEACHING 2030, members of the Teacher Leaders Network address this problem squarely:

Without adequate teaching, supports, and resources, students taught in high-poverty schools have lower achievement. Why are we surprised to learn that many of these schools have become ‘dropout factories’? They are stark evidence of our society’s frequent failure to do what it takes for every child to succeed. And while many choose to blame students or families for the problems in these schools, we now have research documenting that even non-poor students who attend high-poverty schools have lower achievement than their counterparts in low-poverty settings. Plainly put, these are the schools that affluent America has been willing to ignore.

Did you catch that? It’s the poverty of the school, not just of the students, that’s keeping too many of our students from achieving at their highest potential. What possible moral, or even economic, justification can we offer for allowing such inequality?


Jason Kniss, Teacher

Think about SES lines and purchasing decisions

Jason Kniss is a secondary math & special education teacher at a Title I Charter School in St Paul, MN predominantly serving the Somali community of the Twin Cities. He is continuing his studies in Cognitive Science & Instruction.

While there are many components to educational funding, I choose to spend my time and energy focusing on those decisions either within my direct control or within my sphere of influence as a teacher. Looking back at my own K-12 experience, I am grateful for an effective education despite my family’s lower working class status. This was made possible by the school district’s zoning of schools to include all Socioeconomic Status’ (SES) within individual school boundaries so there weren’t “poor schools” and “rich schools.” While these boundaries meant more money allocated for transportation, the impact was positive both in ensuring effective education for all and for directly and indirectly having students interface with issues of difference and privilege. School Boards, teachers and parents must advocate for equal representation across SES lines within individual school boundaries wherever possible. Many times this involves having a direct conversation about privilege and bias but this is a conversation we must engage in.

In addition to zoning, one other area that I see need for improvement is in-school purchasing decisions. Many times these decisions are reactive to publisher advertisements or conference presentations and usually begin with the justification of “it would be great if we had…” verses having student need be the core motivation. In my experience, there is little questioning if specific curriculum, technology, etc. actually has a positive effect on student achievement or development. In addition to not using funds effectively, I feel this adds to a culture of removing ourselves from any responsibility of positively impacting student achievement. It is easy to blame a curriculum and purchase a different one rather than taking a critical look at our planning and instruction. Note that these two focus areas don’t require a major shift in how we allocate our money but rather a major shift in how we think about our schools as the center of communities and our roles as educators.


Mark Fermanich, Oregon State University

We must make our dollars work harder

Mark Fermanich is an assistant professor for education policy at Oregon State University. He specializes in education finance with a focus on building capacity for using education resources effectively.

Clearly, real growth (adjusted for inflation) in per student funding for schools is slowing to a trickle. Between 1920 and 2000 per student revenues grew by an average of more than 5% annually. Since 2000 annual growth has slowed to less than 2%, and much further since the “Great Recession” began in 2008. With rising health care costs and concerns over public deficits and debt, the prospects for an influx of new money for education are likely slim to none.

Yet, expectations for improving outcomes for students remain high, even with the expected repeal of NCLB’s 2014 goal of 100% proficiency. What are school leaders to do when faced with continuing expectations for reform and improvement while the resources they have to work with are stagnant or declining?

The answer is to increase productivity, a.k.a. get more bang for the education buck. Research increasingly highlights instructional approaches that show promise for increasing achievement. These range from how instructional time and staff are organized, to how students are grouped for instruction, to more powerful forms of professional development and teacher collaboration, to using data to guide and evaluate instruction. Federal, state and local education policymakers should strive to keep funding to districts and schools as flexible as possible — in this way, the rules and regulations that so often accompany funding streams do not tie the hands of educators to experiment with new approaches and make necessary adjustments. Of course, this increased freedom must be accompanied by accountability, with appropriate support and interventions available for those districts and schools that fail to make progress.


Mary Perry, Former Deputy Director of EdSource

Look to the successful models

Mary Perry served as Deputy Director of EdSource for 18 years and is widely known in California for her work in school finance, including as lead author of a 2006 study of school district financial management.

In this time of reduced funding for education, making wise choices about how to spend scarce resources must begin with the end in mind. Are we as a nation serious when we claim that we want to get “all students ready for college, career and citizenship”? If we are, then we must be clear about how that might even be possible. Only then can we decide how best to allocate resources at the federal, state, district and school levels.

First, let’s all acknowledge what skilled educators already know. The goal is extremely ambitious and the work complex, particularly in this country where so many children arrive at the schoolhouse doors unprepared for academic success. Further, many schools and educators in this country aren’t prepared to meet this goal. It’s rarely a question of motivation. It’s much more a question of capacity.

Second, let’s think about what differentiates the schools that are making the most progress. Those schools have developed their organizational capacity around the goal of helping each student succeed. They are staffed by professionals dedicated to that work and to constantly improving their own practice. They tend to be stable in terms of their personnel and constantly innovating in terms of their programs. They benefit from leadership that is competent, committed, and sets high standards. They are empowered to try new strategies and constantly look for new instructional tools to help students succeed. They know that it takes a village and so proactively seek the involvement of parents and the larger community. If we’re to meet our goals for students, we ought to be using our funding systems to support local schools’ and districts’ ability to do these things.

Finally, let’s all concede that money matters. How much is available and how it is used are both really important. No, money alone does not make it happen but having enough to maintain stability — plus attract and retain talented professionals — is crucial. And having a bit of extra, targeted funding can provide the incentive schools need to decide to invest in their own capacity.


Randall Reback, Barnard

Consider roving teachers; don’t consider cutting counseling services

Randall Reback is an Associate Professor of Economics at Barnard College, a Faculty Fellow at Columbia University’s Institute for Social and Economic Research and Policy, and a Faculty Member of Columbia’s Population Research Center. He is a former 5th grade teacher. His research examines various topics related to school finance, school accountability, and students’ mental health and behavior.

As school districts face tougher fiscal times, they should very carefully consider where to cut resources. Strong empirical evidence reveals that student achievement declines after states adopt tax limits that decrease school revenues. The items eliminated when schools are forced to make cuts are often more valuable than the items added when schools’ budgets expand — partly due to political pressure to avoid cutting highly visible resources.

Districts must be especially cautious now, because their current financial constraints follow a period of costly reductions in class sizes and school sizes. While smaller classes may be beneficial, they put enormous strain on school systems to find more classroom space and teachers. Similarly, smaller schools, such as the many schools-within-school buildings in New York City, often concentrate resources that could be shared across multiple schools. There are low-cost solutions to this problem, such as designating a coordinator or committee to determine areas where there are gains from trade across the schools.

As school districts are forced to lay off teachers and hire fewer new teachers, they may wish to experiment with roving teachers and teachers’ aides as the second adults in elementary or middle school classrooms. Some innovative schools currently have larger class sizes but rotate teachers and aides through these classrooms to ensure that students still receive individualized attention. When implemented well, this policy has the added benefit of encouraging teacher collaboration and specialization.

One area that should be protected from budget cuts is schools’ mental health and counseling services. These services are critical for maximizing the amount of time that students are “ready to learn” and not disrupting their peers. During economic downturns, these resources tend to be cut at the very time when students need them the most. The cuts are often subtle, such as a principal forcing a mental health professional to coordinate the administration of standardized tests — a task better suited for a teacher’s aide or administrative assistant. The careful school district, however, will continue to employ a wide range of staff — some at much lower cost than others — so that employees can focus on what they do best.


Daniel Thatcher, NCSL

Focus on formulas, teacher comp and data systems

Daniel Thatcher is a Policy Specialist with the National Conference of State Legislators and is based in Denver, Colorado.

State school finance systems are sedimentary. Like layers of rock in the Grand Canyon, school finance is the result of years of legislation layered upon each other, year after year, until they have melded into one, inextricable whole — impossible to disentangle. Unless an earthquake hits.

States can take the Great Recession as a veritable earthquake — an opportunity to more effectively allocate their resources to be cost effective and improve student achievement. State legislators may shake things up in these areas:

1. Funding formulas: Most states distribute funding for schools and teachers through complex formulas that bind districts and schools to rigid student-to-teacher ratios, Carnegie units, staffing positions and categorical programs. Less restrictive funding formulas — coupled with strict accountability measures — can allow districts and schools to think more creatively with their dollars, funding positions and programs designed with student achievement as their objective.

2. Teacher compensation and pensions: Sixty-eight percent of education funding goes toward student instruction. Of that, most goes toward teacher salaries and benefits. Some have argued that any serious savings on education spending will only occur after states reform how — not necessarily how much — they pay teachers and fund their pensions.

3. Data systems: States know surprisingly little about which dollars fund which programs for which students, nor do they know whether those dollars actually improve student performance. Quality data tracking systems can follow dollars with performance outcomes down to the classroom level, in turn increasing the efficacy of the education dollar. Some states have already begun to utilize technology to track successes in the classroom.

However legislators ultimately reform their funding systems, state legislators are certainly rethinking a basic premise on how states fund schools: from an input-based system to an output-based system.


Karen Hawley Mills, Education Resource Strategies

For leading districts, there are three initial strategies

Karen Hawley Miles is the president and executive director of Education Resource Strategies, Inc. (ERS), a non-profit organization dedicated to helping urban school systems organize talent, time, and money to create great schools at scale.

Can we use this moment of budget crisis as an opportunity to transform districts into sustainable systems that effectively educate every child? It might seem like a tall order, but we’ve seen districts make progress by strategically deepening the inevitable cuts they’re facing to free up resources to invest in long overdue changes. Where do leading districts start?

1. Make the toughest cuts now: Almost every district has big, politically difficult cost issues they need to address. Why not tackle them now — when the urgency exists and choices are stark? Refuse to compromise investments that build to the future by taking on antiquated or misaligned spending. For instance, consider closing under-enrolled schools and taking the savings to improve under-resourced schools. Think about restructuring employee benefits plans and redirecting dollars to higher compensation for principals and teacher leaders. Consider opportunities for more cost-effective provision of operational or non-core instruction by outsourcing or partnering with community providers and take the savings to maintain or lower class sizes in core subjects.

2. Invest in changes that will make a big difference: Leading districts are implementing now systemic changes that have significant upfront cost. Don’t wait to get started. Critical long-term investments include a rigorous teacher evaluation system and professional development for school leaders to use it; collaboration time for teachers; good assessments for student learning and data systems that report progress in a timely, useful way.

3. Leverage the resources you have: If you have no more money, you still have time and talent. Most schools and districts don’t leverage either as effectively as they could. Take a hard look at how the skills and experience of individual teachers and how they could be paired together, distributed differently across grades or work in teams that insure the neediest student learn and the weakest teachers are supported. Most schools use rigid antiquated schedules that may over-invest in electives and don’t vary to give students time to catch up on material they missed.

Districts need to carefully examine their current resource decisions and adjust so that every resource at their disposal is being applied in a way that will more likely lead to every child learning. And while many of these changes demand initial investments, in the end they will create sustainable systems that do more with less.


Lisa Snell, Reason Foundation

We need to fund students, not schools

Lisa Snell is the director of education and child welfare at Reason Foundation.

In 2011, there are now 26 school voucher and tax credit programs in 15 states with close to $1 billion in school funding following students to schools. There are more than 2 million students enrolled in charter schools with more than 100 cities with 10 percent or more charter-school market share. In New Orleans, for example, 80 percent of students are enrolled in charter schools with money attached to the student and following the student to the school of choice.

Taking this even one step further, with the growth of digital learning and the need to customize education at all levels, we are beginning to see examples where not only will school funding follow students to the school, but to multiple education-service providers. In Utah, for example, the Statewide Online Education Program allows high school students to select courses from multiple high-quality course options and multiple course providers, while still being enrolled in their public high school. The money follows the kids to the course selection. In April 2011, Arizona Governor Jan Brewer signed into law Arizona Empowerment Accounts. Empowerment Accounts allow parents — in this case, parents of special-needs children — to remove their children from the public-school system and receive the money the state would have spent on them in an education savings account. Every quarter, the state deposits up to 90 percent of the base support level of state funding into a parent-controlled ESA. Parents can then use that money to pay for a variety of educational options including private-school tuition, private tutoring, special education services, homeschooling expenses, textbooks, and virtual education, enabling them to customize an education for their child’s unique needs.

Traditional public school funding systems at the state and local level are also adapting to a “school funding portability” framework where state and local funding is attached to the students and given directly to the institution in which the child enrolls. More than 30 “school funding portability” funding systems are funding student through a student-based budgeting mechanism in cities like New York, Baltimore, Denver, Hartford and Cincinnati. In 2011, Rochester, Newark and Boston have moved to full weighted student formula systems where the money follows the child. Los Angeles Unified is moving from 100 pilot schools being funded based on per-pupil basis to all 800 schools funded based on where the student enrolls. In Louisiana, 7 school districts are piloting a student-based budgeting system, including the largest school district in the state, Jefferson Parish, with 50,000 students. New Jersey, Rhode Island, and Indiana have all recently changed their statewide school funding systems to a state formula where the money is attached to the child.

As Indiana’s Tribune Star reported “Of all the sweeping legislative changes coming to K-12 education, from private-school vouchers to performance-based pay for teachers, the one that may have the most impact is tucked inside the 270-page budget bill. It changes the way schools are funded, following a new formula to divvy up nearly $13 billion in K-12 education dollars. The new formula follows the mantra that “money follows the child.” As Representative Ed Clere, who sits on the House Education Committee explained “The new formula is a “sea change” from the past. We’re no longer funding schools. We’re funding students.”

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