Why the Education Department’s New Equity Rule Might Not Be So Equal

Teachers and the Obama administration are divided over what the federal government’s role should be in telling districts how to fund their schools.

Nguyen Huy Kham / Reuters

When Congress reauthorized the United States’s federal education law last year, few observers were interested in changes to a technical part of the legislation known as “supplement not supplant.” A wonky fiscal rule that has been around for decades, it’s intended to make sure schools with high numbers of poor children don’t get less state and local money because of their participation in Title I, a federal program that provides extra money to help academically struggling students from high-poverty areas.

Instead, public reaction focused on testing requirements and generally characterized the new law—the Every Student Succeeds Act (ESSA)—as returning power to the states. But ESSA made an important change to “supplement not supplant,” requiring school districts to explain how they distribute funds across their schools, and to show that they do not give fewer state and local funds to schools because they get extra federal money under their Title I status. This is a major departure from the previous rule, which allowed districts to comply simply by showing that they used Title I money to support “extra” purchases, regardless of how state and local funds were distributed across schools. Now the U.S. Department of Education is regulating this part of the law, and it’s turned into a political firestorm.

Media coverage has framed the debate in stark terms, with those who care about civil rights and poor children on the side of the Education Department opposed by the strange bedfellows of Senate Republicans protesting executive overreach, teachers’ unions who want to protect seniority-based pay-scales and tenure, and state and district leaders seeking to avoid the administrative hassle of overhauling their budgeting and staffing. What's missing from the story is a deeper dive into what steps districts might have to take to meet the Education Department’s proposed rule, and how those actions could negatively affect school quality for the very students the rule aims to help.

As mandated by the law, the department conducted negotiated rulemaking this spring, where education administrators, school leaders and teachers, and civil-rights groups attempted to hash out implementation of the new “supplement not supplant” rule. The department proposed requiring school districts to spend at least as much in each Title I school (those with high percentages of poor students) as they do on average in their non-Title I schools—and to require these calculations in actual dollars, rather than in staffing allocations. In other words, instead of districts being able to show that every school received one teacher for, say, 25 students, they would have to show that the actual dollar amount going to the schools is the same.

Ultimately negotiators could not reach a consensus, so the department will write the rule itself, and is expected to submit a draft rule for Congressional comment soon. A department official wrote in an email that the department views the proposed rule as essential to overcoming local funding disparities it views as undermining "the intent of federal title I dollars, which are supposed to provide supplemental resources for high poverty schools, not to fill in shortfalls in state and local funding."

On the surface, the proposed rule sounds like a win for poor kids. As my Georgetown University colleague Marguerite Roza shows in an Education Trust report, school districts often spend fewer dollars per pupil in their higher-poverty schools. The rule aims to end this pattern. However, the practical and policy implications are far less straightforward than they first appear.

Most districts use complex methodologies to assign staff positions—not dollars—to schools. Using this kind of staffing methodology, a certain number of students will generate a teacher, another number will generate a counselor, and so on. Districts sometimes account for student disadvantage in these processes, awarding more staff positions if a school has more students who are poor, in special education, or speak limited English.

When it comes to salaries for these positions, districts typically pay staff based on their years of experience. Because teacher turnover is higher on average in poorer schools, these schools usually have higher shares of new teachers who are paid less. Poorer schools therefore on average spend fewer dollars per pupil, even if they have more teachers and smaller classes.

Teacher experience is weakly correlated with teacher effectiveness after the first few years. However, it is a legitimate concern that the overrepresentation of new teachers in high-poverty schools can lead to significantly fewer dollars going to those schools that need them most. It’s also a problem that some high-poverty schools have less access to effective teachers. But this rule will not solve that issue, and could impose significant collateral damage on low-income students, both in and out of Title I schools.

In a best-case scenario under the new rule, districts would have access to “new” money—and districts would send that money to Title I schools not spending as much as their average non-Title I schools. In other words, districts would level school spending up—not down.

Given the current economic environment, however, new money is not an option for many districts. Chicago is facing at least a 20 percent budget cut for its schools next year, over 40 Arizona districts are operating their schools on a four-day week because they can’t pay teachers for five days, and summer vacation is starting two days early this year to save money in Oklahoma City Schools.

Without new money, the only way to comply is by redistributing existing resources. If you think about this problem in dollars rather than teachers, it seems doable: Just pull dollars out of higher-spending schools and put them into lower-spending schools. But it’s not that easy.

This is because districts spend the majority of their budgets on teachers, so the dollars that must be pulled out of some schools and redirected toward others are attached to particular individuals. The easiest way to comply would be to pull experienced (more-expensive) teachers out of non-Title I schools and to put them into Title I schools. But simply moving teachers around is no guarantee of better teacher quality in Title I schools or better outcomes for students.

A broad array of education advocates—including teachers and their unions, as well as many who are not normally sympathetic to teachers’ unions—also strongly oppose forced teacher transfers. And support is growing for giving principals more autonomy over teacher hiring through “mutual consent” policies. During deliberations over the proposed rule, one principal commented that the most important element was retaining control over the teachers she hires, but the provision would work against that.

Supporters of the proposed new rule claim it is viable without forcing schools to give up experienced teachers. But this is only true with major changes to established union contracts, such as reducing the importance of experience and credentials in determining teacher salaries: These are not quick fixes—and would require the input of many people in a given community.

For districts that find these kinds of compromises unattractive or flat-out impossible under their current teacher contracts, the powerful threat of losing Title I funds will likely make them seek out “quick” ways to comply within the proposed five-year timeline. But many of these ways aren’t good for disadvantaged kids in high-poverty or low-poverty schools.

As I discussed here and in my Senate testimony, as a consequence districts might respond to these pressures by continuing to concentrate poor students in Title I schools rather than trying to break up concentrated poverty. This is because compliance with the rule is easier if students are clustered in a few Title I schools. Similarly, they could abandon economic-integration efforts that dilute high concentrations of poverty, such as magnet schools, redrawing boundaries, or increasing parental-enrollment options beyond neighborhood boundaries. Or districts could change which schools they designate as Title I in order to level the numbers, driving programming decisions by compliance rather than school-specific needs. They could shy away from initiatives to make the teaching force more racially diverse in Title I schools because new teachers cost “too little,” making compliance impossible.

The proposed rule would also make school funding less transparent. In a system that doles out money based on staffing (again, used by the vast majority of districts), the only way to comply consistently would be to move funds (or teachers) around after initial teacher placements are decided.

Finally, based on data reported in the 2011 Civil Rights Data Collection (CRDC), some school districts touted nationally for their efforts to improve equity would fail to meet the proposed requirement. These districts are leaders in instituting creative practices like budgets that weight for student poverty, linking teacher pay to their ability to lift student achievement, and using magnet schools to encourage voluntary desegregation. Because the Education Department’s rule only measures equity in terms of Title I vs. non-Title I status, it would force these exemplary districts to overhaul their systems to comply, effectively shutting down local approaches to equity and school improvement.

Negotiators raised concerns about districts that support equity but would fail to comply with the rule, such as if a district awards additional resources to schools based on special-education participation, in a given district generating more state and local money per pupil on average in non-Title I schools. Those who favored the department’s rule suggested creating exceptions for such situations—and it’s possible that many districts that look noncompliant in the CRDC would fare just fine under whatever exceptions the department might propose.

But one reason Congress changed “supplement not supplant” in ESSA is because the old test had so many exceptions that it became almost unworkable in practice, in ways that limited services to disadvantaged students. Creating a laundry list of exceptions works against clarity, especially in a program like Title I, which, despite being federally funded, is administered by state education agencies and subject to their interpretation. And from a practical standpoint, the more exceptions, the fewer districts are bound by the rule. In contrast, the language in the law itself would apply to all districts with both Title I and non-Title I schools.

This national conversation about  grave disparities within districts is long overdue. But the proposed rule is too blunt an instrument—penalizing districts that have made significant strides toward equity, and imposing incentives that could hurt Title I students. The Education Department’s one-size-fits-all approach could set back the equity agenda, rather than advance it.