General

Is School Funding Fair?

February 7, 2014

Laura Waters

There’s a new report out called Is School Funding Fair: A National Report Card written by Prof. Bruce Baker of Rutgers (and the blog SchoolFinance 101), David Sciarra, Executive Director of Education Law Center, and Danielle Farrie, also of ELC. The authors “examine the condition of states’ finance systems as the country emerges from the Great Recession, but is still wrestling with its consequences” and strive to make the case that states “take immediate and longer-term action to improve the fairness of their school finance systems.”

New Jersey, once “one of the fairest states,” is cited for declining funding levels; we now, according to the authors, fund schools at $2,619 below 2007 levels.

Check out the review of the report by Holly Yettick at Education Week. She asked Professor Nora Gordon of Georgetown University for feedback because there was no formal peer review process.:

There are significant and distressing disparities in district-level funding both within and across states, and it’s particularly worrisome that these disparities are sometimes regressive.” However, she [Gordon] also believes that using funding as a proxy for school quality does a disservice to poor students, the very ones the authors want to advocate for. An ideal comparison of how districts and states are doing would include data on student outcomes, like how the income gap in NAEP scores varies by state. Two states with similar levels and distributions of funding could have very different student outcomes depending on what they’re doing with their money, which is a lot harder to measure than their revenue levels. This is the line of reasoning behind recent federal efforts, like Race to the Top and ESEA [Elementary and Secondary Education Act] flexibility. Whether or not you’re a fan of the particular policies they’re trying to promote, it’s clear that the federal government is interested in changing how education agencies and schools run, not just in how much money they have.

Danielle Farrie agreed with Yettick that it would interesting to try to correlate school funding with outcomes but Bruce Baker tweeted that Gordon’s critique is “silly.”

Laura Waters

4 Comments

schoolfinance101, February 7, 2014 @ 7:06 pm Reply

Here is what I tweeted:
3 responses to silly edweek critique of funding fairness report: http://schoolfinance101.wordpress.com/2011/09/13/revisiting-why-comparing-naep-gaps-by-low-income-status-doesnt-work/ … & http://schoolfinance101.wordpress.com/2011/12/01/the-comparability-distraction-the-real-funding-equity-issue/ … & http://schoolfinance101.wordpress.com/2011/12/01/the-comparability-distraction-the-real-funding-equity-issue/ …

The links above explain that:
a) the arguments made about poverty achievement gaps ignore problems with measuring poverty achievement gaps across states.

b) the federal revenue issue is a largely moot point given how small a role those federal revenues play, and

c) the within district issue, while somewhat relevant, and a focus of much of my work, is a smokescreen, and remains relatively minor when compared with the between district combination of economic/racial segregation and funding.

As you well know, most of the student sorting that occurs in in states like NJ is across not within district boundaries. the same is true in most other parts of the country. Thus, the bigger issues of equitable funding remain figuring how how to get funding to those areas of greater concentrated need – where concentrated need varies most dramatically across district boundaries. Should we ignore within district disparity. Of course not. But it's a smokescreen issue to draw attention away from the bigger, more contentious issue of between district equity.
jsbennett70, February 7, 2014 @ 8:38 pm Reply

Bruce Baker has a very narrow view of fiscal equity in New Jersey. He only focuses on the Abbott to non-Abbott comparisons and ignores the huge disparities between suburbs.

The fact is that New Jersey aids exurban schools at levels 2-6 times their suburban peers. These disparities exist no matter how you break the aid streams down. Even if you subtract Adjustment Aid these gross inequities exist.

The follow examples are random and yet representative:

– Hamilton Township (DFG FG, 11,000 students) in Mercer county gets $73 million in state aid. Clark, Bergenfield, Dumont, Fort Lee, Hasbrouck Heights, Maywood, New Milford, Northvale, Rochelle Park, Wood Ridge, Nutley combined (all DFG FG, 24,000 students) get $27.5 million.

– Marlboro gets (DFG I, 5200 students) gets $11.5 million in state aid. Berkeley Heights, Springfield, Scotch Plains-Fanwood, Cranford, Mountainside, and Westfield combined (DFG FG-I, 21,000 students) get $10.8 million.

– Hillsborough (DFG I, 7,200 students) gets $24.9 million. South Orange-Maplewood, West Orange, and Edison combined (DFG GH-I 28,000 students)get $26.8 million.

– West Windsor-Plainsboro (DFG J, 9800 students) gets $7.3 million. Livingston, Glen Ridge, Verona, Oakland, and Summit combined (all DFG I, 18,700 students) only get $7.1 million.

Exurban districts even get double the per student funding of districts that are 2-3 Factor Groups below them.

– Old Bridge (DFG FG, 9,000 students) gets $44.5 million. Clifton and Bloomfield (DFG CD and DE, 18,000 students) combined get $46.7 million. Aid per student for these districts is $5,013 for Old Bridge and $2,262 and $3,286, respectively, for Clifton and Bloomfield, even though Clifton and Bloomfield's financial resources are smaller.

– Jefferson Township (DFG GH, 3,400 students) gets $15.8 million. Hackensack, Lyndhurst, and Garwood combined (DFG CD-DE, 8,400 students) only get $15.1 million.

I haven't read everything Dr. Baker has written, but this is something he tends to ignore.
JSB79, March 11, 2014 @ 2:24 pm Reply

To add to the evidence that state aid and school funding in New Jersey is highly unfair and biased towards the exurbs, consider these comparisons of exurban districts, their wealth and percentage of at risk students, to a few selected suburban districts, their wealth, and their percentage of at risk students.

Hillsborough’s valuation per student is $830,000 and its per capita income is $43,000. 8% of Hillsborough students are FRL eligble and 2% are ELLs.
Bloomfield’s valuation per student is $664,000 and per capita income is $30,000. Bloomfield's students are 35% FRL eligible and 3% are ELLs.
Hillsborough receives $19,274,266 in Equalization Aid – about $2,600 per student, whereas Bloomfield receives $15,125,042 – about $2,300 per student.

Marlboro has more $1.3 million in valuation per student and a per capita income of over $50,000. 4% of Marlboro students are FRL eligible and 1% are ELLs.
West Orange, on the other hand, has $861,000 in valuation per student, with a per capita income of $43,000. WO's students are 36% FRL eligible and 4% are ELLs.
Yet Marlboro receives $6,247,588s ($1160 per student) in Equalization Aid while West Orange receives $1,793,898 (only $260 per student.)

Old Bridge has $760,000 in valuation per student and a per capita income of $37k. 25% of Old Bridge students are FRL-eligible and 3% are ELLs.
Clifton has more valuation per student, $816,000, but a much lower per capita income of $29k. 48% of Clifton students are FRL-eligible and 5% are ELLs.
Old Bridge gets $36,867,100 in Equalization Aid, or $4,089 per student. Clifton gets $17,684,735 in Equalization Aid, or $1,550 per student.
Old Bridge's Equalization Aid per student is almost double what Clifton's overall education aid per student is.

Bridgewater-Raritan has $1.18 million in valuation per student and a per capita income of about $45,000. 8% of Bridgewater-Raritan students are FRL-eligible and 2% are ELLs.
Fair Lawn has $968,000 in valuation per student a per capita income of $40,000. 9% are FRL-eligible and 3% are ELLs.
Bridgewater-Raritan gets $2,091,882 million in Equalization Aid, or $244 per student. Fair Lawn gets $147,343 in Equalization Aid, or $32 per student.

What's also contributes to inequity is that that some of the districts that get large amounts of Equalization Aid also get large amounts of Adjustment Aid.

Marlboro gets $533k in Adjustment Aid and $560k in Additional Adjustment Aid!
Old Bridge gets $437k in Additional Adjustment Aid.
Hillsborough gets $406 in Additional Adjustment Aid.

If you focus entirely on the Abbotts and you think that low-income districts should have huge amounts of state aid, then NJ's school funding is “fair.” If you look beyond the Abbotts then NJ's distribution of K-12 school aid and school funding is irrational and deeply unfair.
JSB79, March 11, 2014 @ 2:34 pm Reply

Another comparison that illustrates the unfairness of NJ's aid distribution is Lawrence Township and its neighbor Princeton.

Princeton (DFG I) has a valuation of $1.9 million per student and has a per capita income of $56,000 a year (one of the highest in NJ).

Lawrence Township (DFG GH) has a valuation of $1.2 million per student and a per capita income of $33,000 a year.

Who do you think should get more state aid? Lawrence Township, right?

No. The state gives more money per student to Princeton.

For 2013-14, Lawrence Township received $835 per student. Princeton received $940 per student. (excluding Extraordinary Aid).

In summary, the state's distribution of K-12 aid is completely irrational and unfair. Inner suburbs are usually hurt in the distribution.

I don't know how any informed person could ever say that our school funding and/or state aid distribution is fair.

Sources:

http://en.wikipedia.org/wiki/New_Jersey_locations_by_per_capita_income

http://www.state.nj.us/education/finance/fp/ufb/2013/reports/21/4255/UFB13_4255.pdf