Districts serving many low-income children in New Jersey receive nearly $5,000 more per pupil from the state government than districts with fewer poor students. If that same district was located in Montana, it would only receive an extra $18 per student from the state. Despite the fact that the majority of states have education funding formulas meant to target low-income students, the effectiveness of this targeting varies widely around the country.
In states where districts are more economically segregated, policymakers have an easier time targeting funding to the neediest students. Because poor children benefit more than their wealthier counterparts from increased per pupil funding, a correctly tuned targeting formula could be an important step toward closing the achievement gap. According to a new report released by the Urban Institute, a social- and economic-policy nonprofit in Washington, D.C., the degree to which funding is targeted is inconsistent among states. In three states—Nevada, Wyoming, and Illinois—non-poor students attend better funded school districts despite state and federal government efforts to level the playing field.
School districts receive local, state, and federal funding, and available local dollars typically reflect the socioeconomic makeup of a community. In areas where students come from higher income brackets, the researchers found, families typically pay more in property taxes, which help fund schools. As a result, local funding is regressive—meaning more of it flows to schools with fewer low-income students—in all but a few states. In some cases, the disparity is extreme: Districts in New Jersey with fewer poor students receive about $3,460 more in per pupil local funding. On the other side, poorer districts receive $242 more per student in local money in Louisiana.