Author Archives: Jennifer O'Neal Schiess

Everything You Always Wanted to Ask About School Finance But Were Afraid to Ask

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How do individual schools get their funds from districts, how do districts get funding from states, and how do states generate revenue for education?

These are little-understood mechanisms, and what’s more, the way we finance schools looks different in almost every community because of statutory structures and local context.

There’s a lot of prognosticating going around about how school budgets will look next calendar and school year due to COVID-19, but the economic shock flowing through the education sector needs to be tempered with some fact checking and clarity. In my previous life, I advised the Texas legislature on public education budgeting and school finance, so I’m here to simplify the complex so education leaders can get a clear and accurate understanding of how funding actually trickles down.

After you read these FAQs, check out the rest of The Looming Financial Crisis? series for key takeaways for school districts, state education agencies, individual schools, charter networks, and more:

  1. Where does most school funding come from?
  2. Where do state dollars for education come from?
  3. What about local dollars? Where do those come from?
  4. Why can’t we predict next year’s school budgets? Shouldn’t school funding already have decreased since many people are out of work and probably not paying income taxes?
  5. What are a few different scenarios you could imagine for schools?
  6. What are the first things to go when a school leader has reduced funds to work with?
  7. Don’t governments have reserves they can lean on during tough times?
  8. If a state or district leader wants to prepare for different possible economic impacts, what should they be doing?
  9. What if I want to get wonky and learn more about this?

Where does most school funding come from?

The first common misunderstanding is about where the bulk of school-level education funding actually comes from: your local community, your state, or the federal government.

The answer is it’s all three, but not the breakdown you might assume. As the chart below shows, funding for education, on average is mostly from state and local governments, about a 50-50 split, with only 8-10% coming from the federal government. It is worth noting that while these proportions of state and local funds are true on average, tremendous variability in how much funding comes from state versus local sources exists between and even within states, depending largely on the structure of state school funding formulas.

The two largest sources of federal funds from the U.S. Department of Education are Title I, which targets funding to schools serving low-income students, and the Individuals with Disabilities Education Act (or IDEA), which supports students with disabilities. In addition to these large programs, the federal government also runs grant programs to support other initiatives including teacher quality, early childhood education, and charter schools. And the federal government heavily subsidizes school meals, which is the largest source of federal funding flowing into schools, through the free and reduced-price breakfast and lunch programs administered by the U.S. Department of Agriculture.

But the bulk of funding that supports educator salaries and benefits, instructional materials for students, construction and maintenance of school facilities, school transportation systems, and all the other core ingredients for school operations are funded from state and local funds.

Where do state dollars for education come from?

Most states get most of their revenue from income and sales taxes. Different states tax different purchases differently (e.g., some states exempt select purchases considered to be basic needs, like food and medicine), and some don’t charge any income or sales tax at all. There are nine states with no personal income tax, but several of those have some other tax source to fill the gap (like Alaska and Texas, which generate significant revenue from the oil and gas industry). Most states have a mix of other taxes and fees they may levy on businesses, tourism, or other specific activities. But across the country, personal income tax and sales tax provide the lion’s share of state tax revenue.

State tax dollars pay for a range of services, with the largest proportion of state investments in most states going to K-12 public education. Beyond K-12 education, significant state spending goes to public higher education systems, health care (especially Medicaid, which is jointly funded from state and federal sources), criminal justice systems (state law enforcement, court, and prison systems), social services (like child protective services and administration of family supports), economic and workforce development, and regulatory functions (like licensing child care facilities or various professional licenses). Many of these functions are also supported with federal and/or local funds.  Continue reading →

Stop Saying “At Least We’re Not Mississippi”: A Q&A With Rachel Canter of Mississippi First

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There’s a tired trope in Southern states: “At least we’re not Mississippi.” The implication is that while one’s state may be underperforming on some measure — poverty, rates of uninsured, education outcomes, etc. — Mississippi can always be counted on to look worse. 

Having grown up, taught school, and worked in education policy across the South my whole life (but not in Mississippi), I’ve heard this statement plenty. I heard it as recently as this fall at a conference, leveled by a national thought leader who ought to know better. 

Last spring, Bellwether released “Education in the American South,” a data-filled report which highlighted, among other things, how the national education reform conversation has largely bypassed the South — a conclusion bolstered by the persistence of this Mississippi myth.

Here’s the thing: While many of us look down our noses, Mississippi has been working hard — and it’s been paying off. In the most recent National Assessment of Education Progress (NAEP) scores, Mississippi was the only state to see improvements in reading and had the biggest gains in fourth-grade reading and math. Mississippi’s gains have been nearly continuous over the last 16 years and mostly unmatched in the region.

To dig more deeply into what’s gone right in Mississippi, I talked to Rachel Canter, longtime Mississippian and co-founder and Executive Director of Mississippi First, an education policy, research, and advocacy nonprofit working to ensure that every Mississippi student has access to excellent schools.

This conversation has been lightly edited for length and clarity.

The most recent NAEP results highlight the progress schools and students in MIssissippi have made, but 2019 isn’t the beginning of this story. When did the tide start to turn and why? Continue reading →

Building a School Performance Framework for System Management and Accountability? Lessons From Washington, D.C.

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At its core, a school performance framework (SPF) is a data-based tool to support local decision making. An SPF designed for system management and accountability provides data and information about system-wide goals to district- or city-level leaders overseeing multiple schools, helps leaders hold schools accountable for student outcomes, allows leaders to understand which schools are performing well and which are not, and informs system-wide improvement strategies and the equitable allocation of resources. 

Our recent publication “School Performance Frameworks: Lessons, Cases, and Purposeful Design,” a website and report available at SchoolPerformanceFrameworks.org, identifies system management and accountability as one of three primary “use cases” that can shape SPF design decisions. A “use case” (a concept borrowed from the field of technology and design) helps designers think through their end users’ needs. Our work imagines local leaders as designers and considers how the choices they make can meet the needs of different end users, including parents, school principals, and district leaders. Among the five long-standing SPFs we looked at in detail for our project, four prioritized the use case of system management and accountability in their SFP design. 

We also found that too many SPFs try to fulfill multiple uses at once, without clearly thinking through priorities and potential tradeoffs. This post is the third in a series that looks at SPFs through the lens of each use case to highlight design considerations and relevant examples.

SPFs built for system management and accountability can inform consequential decisions made at the district level about which schools should be rewarded, replicated, or expanded, and which ones require improvement, intervention, and possibly closure. These SPFs get the most attention when the data they produce result in school closures or other highly visible consequences. While closures may grab headlines and garner resentment for SPFs, a well-designed SPF can actually inject transparency, equity, and fairness into even the most challenging decisions and increase opportunities for students and families by highlighting success and supporting the expansion of quality school options. 

An SPF created for system management and accountability should include:

Continue reading →

Media: “Budget veto presents chance to revisit a missed opportunity: Investment in early childhood education” in EdNC

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In an op-ed published yesterday at EdNC, I call for the North Carolina General Assembly to revisit pre-K funding as it rewrites the recently vetoed state budget bill. The state could and should more fully leverage this valuable asset to drive improved outcomes for North Carolina’s children.

An excerpt from the piece:

Gov. Roy Cooper recently vetoed North Carolina’s state budget plan. As lawmakers go back to the drawing board on critical issues like Medicaid expansion, the General Assembly would be wise to revisit a missed opportunity in its public education budget: investment in early childhood.

The challenge in North Carolina is not the quality of NC Pre-K, our state pre-kindergarten program. The challenge is that far too few children can access it. 

Read the rest of this piece at EdNC. Learn more about educational, economic, and social conditions in the American South and strategies southern states have pursued in early childhood and across the education continuum in Education in the American South: Historical Context, Current State, and Future Possibilities.

School Principals Aren’t Quitting En Masse, But These Factors Affect Their Satisfaction

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Photo courtesy of Allison Shelley/The Verbatim Agency for American Education: Images of Teachers and Students in Action

This post is part of a week-long series about educator and leader pipelines. Read the rest of the series here.

An often-cited 2012 MetLife survey indicated that 1 in 3 principals was very likely to leave their role. According to EdWeek coverage at the time: “Nearly half of principals surveyed indicated that they ‘feel under great stress several days a week.’ And job satisfaction among principals has decreased notably…” After the survey’s release, the education community echoed concerns about increasingly frustrated principals.

But a new report indicates that while some principals may be as unsatisfied as they were in 2012, they are not in fact fleeing the job in droves.

This past July, the National Center for Education Statistics (NCES) published findings on principal attrition and mobility from the 2016-17 Principal Follow-up Survey.

The overall results show that principals stay in the profession at high rates. Among the 2015-16 cohort, 88 percent were still principals in 2016-17, with 82 percent of them in the same school. More than half had served as principals in the same school for three or more years, and nearly 70 percent had served as a principal in any school for three or more years.

The report separates the survey sample into “stayers” (serving as principal in the same school as the base year), “movers” (serving as a principal in another school), “leavers” (not serving as a principal), or “other.” Digging into the attrition data more deeply reveals that the percentage of stayers, movers, and leavers holds fairly consistently across various characteristics, but there are some differences. While small — often just a few percentage points — a few of these differences stand out, potentially warranting monitoring over time to see if new trends emerge:

  1. A higher proportion of charter school principals leave the profession compared to district school principals. The difference in the percent of leavers is less than four percentage points (13.8 percent compared to 9.4 percent), but the 2016-17 results are the first to show this difference. Results from the two previous versions showed differences less than one percentage point between the two groups. We can only speculate what factors may be driving the change, and only time will tell if it represents and emerging trend or a one-time blip.
  2. Having less experience as a principal does not appear to affect attrition rates, but experience as a teacher prior to becoming a principal may. The percentage of leavers across years of experience as a principal is fairly stable except for the highest levels of experience. Higher “leaver rates” among the most experienced principals is expected because of the impact of retirement. However, a slightly higher proportion of principals reporting less than five years experience as a teacher prior to becoming a principal left the profession, suggesting that either total experience, total experience in education, or specific experience as a teacher may influence how long a principal stays in the profession.
  3. A slightly higher proportion of principals who served in lower-income schools leave the profession compared to wealthier schools. The difference in the proportions between these two groups is only 3 percentage points (11 percent compared to 8 percent). It is also worth noting that the proportion of leavers serving in schools with a lower percentage of free and reduced-price lunch participation (between 25-49 percent) is about the same as that in schools with the highest participation rates. In short, student population doesn’t seem to largely affect principals’ decision-making.
  4. Even principals who indicate a high level of dissatisfaction in their work mostly stay in their roles. The vast majority of principals surveyed indicated that they find their jobs satisfying, and a sizable proportion indicate plans to remain in the profession as long as they are able or at least until retirement. Even among the subset expressing agreement with negative statements such as “I don’t seem to have as much enthusiasm now as I did when I began this job” (29 percent of respondents), “I think about staying home from school because I’m just too tired to go” (13 percent),  or “The stress and disappointments involved in being a principal in this school aren’t really worth it” (16 percent), more than three-quarters of them stayed in their roles at their same schools.

The good news is that on average, principals appear to be a fairly stable group: they stay in their roles over time, and when that stability is matched with quality leadership, good things will happen for students and schools. But it is critical to continue working to ensure that educators have the supports and resources they need to be successful so that every school has an inspired leader at the helm.