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Third consecutive year in school spending increases marked a “full recovery” from the recession

California drove national spending increases in education while New Jersey retreated from earlier efforts to give extra money to low-income schools

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Proof Points

“In school finance, this is as exciting as it gets.” That’s how Stephen Cornman, a statistician inside the U.S. Department of Education’s National Center for Education Statistics, described official figures confirming a “full recovery” in education spending in 2015-16, seven years after the recession.

The adjective “full” emphasizes that even in real dollars, after adjusting for inflation, more resources were pouring into prekindergarten through 12th grade classrooms across the country than before state and local governments started cutting spending in the 2009-10 school year.

A December 2018 report that calculated funding in each state first revealed this national recovery. This additional May 2019 analysis is more detailed, crunching the dollars for each school district in the nation. It found that school districts spent a national average of $11,669 on each child, about a $350 increase from the prior year. That’s the third annual increase in a row after four years of consecutive spending cuts.

The recession lasted 18 months, from December 2007 to June 2009. Yet it took state and local governments until 2015-16 to restore their tax bases, muster the political will to approve spending increases and send the money to schools. The lag time between economic cycles and education spending is long.

Some of the biggest school spending increases were in California. Los Angeles increased funding by 9 percent between 2014-15 and 2015-16. Seven large school districts in California, including Oakland, Long Beach and Fresno, raised spending by more than 10 percent during that same year. Another notable jump was in Houston, which raised spending by almost 15 percent.

Because school funding is so decentralized in the United States, the amount spent on each child ranges widely. Among the 100 largest school districts in the country, the biggest spender was New York City at more than $24,000 per student, a 9 percent jump from a year earlier. The lowest spender was Jordan School District, Utah, a large district of 53,000 students outside Salt Lake City, at just over $6,000 per student, a 3 percent improvement. Despite the large increases in California, spending in many school districts in that state remained below the national average.

Related: How rising teacher pension costs hurt school districts

The nation as a whole continued to invest more money educating wealthier children than poorer children. Districts with the wealthiest children in the nation allocated about $14,000 per student, roughly $500 more than in districts with the poorest students. That 3.5 percent funding gap between high- and low-income districts was virtually unchanged between 2014-15 and 2015-16.

The gap exists because poverty is concentrated in the South. Southern states tend to spend less on public education than northern states.

Within each state, the funding gaps between rich and poor weren’t as inequitable. In the overwhelming majority of states, 40 states, the poorest districts were better funded than the richest. (Hawaii and the District of Columbia operate all of their schools within a single district so statisticians can’t compare poor versus rich districts inside their jurisdictions.)  Advocates for the poor argue that low-income children need considerably more resources to compensate for the effects of poverty. Kids in poor schools are more likely to need reading tutors, for example. That’s expensive.

Only in nine states did the richest districts receive more funds than the poorest districts. The most glaring example of this was Illinois, where the poorest quarter of school districts in the state received 22 percent fewer dollars than the richest. That adds up to a $3,000 difference per child. But Illinois has made changes to its funding formula and that gap should narrow.

Meanwhile, New Jersey retreated from its earlier efforts to fund high-poverty districts more generously. In 2014-15, the poorest districts received over $8,200 more per pupil than the richest. In 2015-16, the funding advantage for high-poverty schools had fallen to $5,000 per student. Still, education funding in New Jersey remained among the highest in the country. Students in poor districts received nearly $26,000 each — the fourth highest spending amount for poor kids after Alaska, New York and Wyoming.

Related: While the rest of the world invests more in education, the U.S. spends less

The rise of charter schools muddies this analysis. Charters tend to spend less per student but they are excluded from these equity calculations. To the extent that charter schools serve low-income students and are educating a big share of the student population, these statistics are overstating the resource advantage that some districts are giving to poor children. For example, more than 10 percent of students in Michigan attended charter schools in 2015-16. Perhaps if their school spending was included, Michigan would not be able to boast that it is giving its poorest school districts 29 percent more funds than its richest. Outside of cities, however, charter schools often cater to wealthier families. So it’s unclear how charters are affecting financial equity in education overall.

A big question is how much of this spending is getting to students in the classroom. Administrative overhead and building repairs eat up a big chunk. And both pension and healthcare payments to retired teachers are expected to deplete bigger and bigger portions of school budgets in the years to come.

This story about school spending was written by Jill Barshay and produced by The Hechinger Report, a nonprofit, independent news organization focused on inequality and innovation in education. Sign up for the Hechinger newsletter.

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Jill Barshay

Jill Barshay is a staff writer and editor who writes the weekly “Proof Points” column about education research and data. She taught algebra to ninth… See Archive

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