Schools across the country spend $334 less per pupil for students of color than for their white counterparts because of a federal loophole under the No Child Left Behind Act, a new national study finds.

More markedly, schools where 90 percent or more of the students are black, Latino, and other nonwhite races spent $733 less per student, according to the study by the Center for American Progress, which explored Education Department data.

Generally, funding per U.S. student exceeds $10,000, including programs like special education, adult education, and school nutritional programs. The CAP study, however, excluded for those special factors and determined a national median per-student spending of $4,038. 

These disparities are most pronounced in "racially isolated" schools — those where 90 percent of the students are either white or minority, figures showed.

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Many public schools with high black and Latino student populations, which are often also from lower-income families, are missing out on thousands of dollars each year, said Ary Spatig-Amerikaner, the study's author.

"When you compare the $733 per student — that doesn't mean a lot to people," she said during a phone interview. But in a school with 600 students, which is the average for lower-income public schools, she said, that's nearly $439,000. That sum, for instance, could finance a dozen new teachers or several veteran teachers at such minority-majority public schools.

"That's a big difference — they can use that money to reduce class size dramatically," she said, by hiring more teachers.

Spatig-Amerikaner arrived at those calculations by adding the salaries of all teachers at one school and dividing the sum by the number of teachers at that institution, rather than diving total salaries by the total number of instructors district-wide.

More than 40 percent of public-school funding is generated at the local level, mainly by property taxes, said Cynthia Brown, CAP vice president for education policy. The rest of the school funds are generated by each state, which usually is about 45 percent, and federal funds, which typically are another 10 percent.

It's generally accepted that variances of per-student spending stems largely from the differences in property taxes, where the wealthier school districts generate more revenues for their schools. But there are other reasons also.

Under a provision of Title I of the NCLB law, school districts must show they provide comparable education to Title I schools, or high-poverty schools.

School district can satisfy the "comparable education" requirements via a student-teacher ratio, which about 80 percent of schools use. Another is by showing the district-wide average teacher salary. 

By averaging district-wide salaries, instead of calculating salaries per school, it gives the impression that all schools have teachers with comparable earnings, which is not the case, Spatig-Amerikaner said.

For example, a school district with a school in a mostly white neighborhood might have more experienced teachers but one across town, in a neighborhood with more blacks and Latinos, might have a higher teacher turnover. Veteran teachers typically earn more than newcomers or replacement educators.

A district would then self-report, suggesting it is meeting federal standards. In actuality, teacher salaries alone create a significant disparity in per-student spending; further, parents in more affluent neighborhood may be more savvy in  fundraising drives that benefit their child's school.

Critics of this loophole also decry the statistics of staff ratios. Though the NCLB Act prohibits paraprofessionals from directly teaching students, they can be counted toward the student-staff ratio. This means that a class aide in a lower-income school can be counted the same as a teacher with a master's degree at a wealthier school, according to New America Foundation.

Asserting that the United States has the most unequal system for funding schools among advanced countries, Brown said that policymakers should rethink the public-school funding system.

"They should distribute money based on student need, not just on the slots" [of teachers], Brown said.

The Education Department, for the first time, collected data on school-level expenditure, including teacher salaries in 2009. Those numbers now give educators a glimpse at the disparities of funds allocated to different schools and by how much.

School personnel aren't aware that this problem exists, mainly because they haven't had the data until now, Spatig-Amerikaner explained.

Some school districts, including those in Oakland, Calif., Hartford, Conn., and Baltimore moved away from funding based on staffing numbers. Earlier this year, the Hartford district's principals adopted a student-based budgeting strategy that equates projected student enrollment with needs of individual students, according to a story in the Hartford Courant.

Erika Beltran, policy analyst with the National Council of La Raza, said there are some 121.1 million Latinos in U.S. public schools, and about a third of those students need additional assistance to master English.

Funding minority-majority schools, she said during a conference call last week, can help put these students on a path to become English-speakers.

"At an environment where students of color are graduating high school at far lower rates than white peers, it doesn't make any common sense to spend so many fewer dollars on school serving high-concentration of students of color, " Spatig-Amerikaner said. 

This article is part of our Next America: Higher Education project, which is supported by grants from the Bill & Melinda Gates Foundation and Lumina Foundation.

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