Three Potential Risks of New Federal Weighted Student Funding Pilot

The education field widely acknowledges that some students may need additional support to thrive in school and beyond because of challenging life circumstances, specific learning needs, or other factors. And, in fact, the structure of federal funding programs like Title I and the design of many state school funding formulas recognize this principle and provide targeted support and differentiated funding based on specific student needs.

However, this idea is rarely reflected at the local district and school level, where budgets are more commonly based on inputs like staffing ratios and salary schedules that are not directly linked to the needs of students served in a given school. But a new federal pilot program authorized under the Every Student Succeeds Act, 2015, (ESSA) seeks to change that by incentivizing more districts to redesign their school funding methods around students.

School districts’ applications to participate in ESSA’s weighted student funding pilot program are due to Secretary DeVos today. And while these funding models could theoretically increase equity, the devil is in the details. The Department, advocates, and ed-watchers should be on the lookout for both the potential rewards and the risks of these district proposals.

Under a weighted student funding model (WSF), districts fund schools in whole or in part through a formula that considers the total number of students served in each school and specific student characteristics linked to higher costs. These types of formulas assign greater funding weight to students with such characteristics, sending more money to the schools serving them.

Well-designed WSF systems can counter the unfortunate result of common funding distribution methods currently in practice in many districts, where input-driven funding methods often result in higher funding levels in schools that serve fewer high-need students. As such, in theory, encouraging more districts to implement funding allocations that shift resources toward student need should be a boon to equity — a potentially big “reward.”

To date, districts that have implemented WSF, such as Boston, Denver, and Indianapolis, have limited these allocation methodologies to state and local funds. Federal funds have been left out of the mix primarily because federal regulatory and reporting requirements make it complicated and burdensome to mingle federal, state, and local resources in a single, unified WSF formula.

This ESSA pilot could change that by waiving many federal requirements and permitting approved districts to combine funds and allocate them to schools under locally determined WSF formulas. In exchange, these formulas must provide “substantially more” funding to low-income students and English language learners compared with other students.

However, relaxing regulatory oversight is risky. Despite requirements written into the law, vague guidance from the Department on how important regulatory protections will be evaluated and enforced could actually allow districts to participate in the pilot without increasing funding equity.

Risk #1: “Substantially more”

ESSA requires that pilot participants provide “substantially more” funding for low-income students, English learners, and any other group of disadvantaged students the district identifies. This requirement intends to protect against districts rolling back funding for services targeted for these students. However, in the application materials, the Department does not define how much more funding needs to go to identified students.

In fact, the law only requires that compared with the preceding year, districts provide “more” funding from all sources to low-income students and at least flat funding for English language learners. This establishes a baseline relative to prior funding for the targeted group and not relative to other students not identified as disadvantaged. It is easy to imagine how a district could comply with that rule without providing differentiated funding for low-income students or English language learners.

Risk #2: “Significant portion”

Even districts that have been using WSF models for a while don’t necessarily flow all funding through that formula. There are legitimate reasons for this, which may be tied to incremental implementation of WSF, separate accounting for capital costs, or other factors. The ESSA pilot requires that a “significant portion” of funds flow through participants’ WSF formulas. However, the application fails to define how much funding qualifies as “significant.” This is critical because the positive impact of a well-designed, equitable formula can be undermined if enough funds are funneled outside that formula through a more regressive method.

Risk #3: Scoring questions

In addition to vague guidance on issues critical to promoting equity, a lack of clarity regarding how district applications will be graded raises concerns. On each question, a district will receive a rating (strong, sufficient, insufficient) that corresponds with 10, 5, or 0 points. The top 50 plans based on total points will be approved. Application guidance does not indicate whether a 0 score on any section is disqualifying. As a result, it appears possible that a plan that earns 0 points on critical questions could still be approved if its total score lands it near the top of the list.

Although DeVos recently gave a strong speech about her disappointment in weak state ESSA accountability plans, she nevertheless approved them. The lack of clarity and rigor in the WSF pilot application drives concern that she may be similarly lax in approving these district plans.

The ESSA pilot could incentivize real gains to the equitable distribution of funding if it promotes well-designed local formulas that truly link resource allocation to the cost of supporting strong outcomes for all students. However, it remains to be seen whether the Department will harness this potential by elevating principles of equity in its review and approval process and enforcing the equity protections written into the law. Absent those commitments, the pilot could elevate funding models that do little to increase equity, or even roll it back. The education sector must pay careful attention to those devilish details, push districts to improve when necessary, and hold the Department accountable to the full legal requirements in the law.

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