Paths to school finance reformPPIC studies suggest steps to be taken now
The state’s system of funding K-12 schools is inadequate, inequitable and opaque.
Only taxes, time (the next two decades of passively watching the economy improve) or a settlement of the Robles-Wong v California lawsuit can fully address the issue of insufficient school funding. But the Legislature can take steps now to make school funding fair and transparent, researchers for the Public Policy Institute of California conclude in two studies released on Tuesday.
“Pursuing structural reforms today will not only meet a critical need but will also help California be better prepared tomorrow, when it can afford to invest more in its K–12 system than it does now,” PPIC research associate Margaret Weston writes in At Issue: School Finance Reform
Outdated funding formulas set in the 1970s, combined with dozens of categorical programs that the Legislature earmarked for specific purposes, have created quirky, complicated district allocations that defy explanation, let alone justification. (As one example, the study cited $1,000 per student funding differences in base revenue allotments among three elementary districts in the same Southern California zip code.)
The studies recommend combining the categorical programs – a process that the Legislature has already begun – while simplifying and equalizing per student funding, with extra money for low-income students. Gov. Schwarzenegger’s Committee on Education Excellence recommended this weighted, per student funding approach, and Gov.-elect Jerry Brown has said he favors it, too. Stanford emeritus professor Michael Kirst, Brown’s chief education adviser, co-authored a study 2½ years ago that factored in regional costs of living, as well as poverty. So the timing is good to raise the issue again now.
The PPIC studies are agnostic as to the formula. Some alternatives give high schools extra money or schools with more expensive career and technical education programs. But the more factors, the more complicated the allocation becomes and the harder to explain to the public.
The studies assume that finance reform will not leave districts with less per student funding than they already receive. The good news is that student population in coming years is projected to grow slowly in relation to taxpayer income, resulting to higher per student funding under Proposition 98. The bad news is that it will take until 2030 to substantially increase K-12 spending, short of raising additional revenue, according projections in the second study, Pathways for School Finance in California. Settling two school finance lawsuits, brought by statewide education groups and attorneys for poor families, could accelerate additional funding.
The PPIC studies recommend five principles for a framework for allocating new revenues and creating a more efficient school finance system:
- Provide additional revenue to districts facing different resource needs – the weighted student formula;
- Structure incentives properly: Don’t inadvertently reward districts that fail struggling students;
- Allocate funds transparently so that the allocations can be easily understood;
- Treat similar districts equitably;
- Balance state and local authority: Give districts more control over revenues in exchange for a higher level of accountability.
The Pathways study, an expansion of the At Issue paper, was written by Weston, Jon Sonstelie, professor of economics at the University of California, Santa Barbara, and Heather Rose, an assistant professor in the School of Education at the University of California, Davis.