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DECEMBER 3, 2020
NALFO FALL PROGRAMMING SERIES
Trends and Challenges in State K-12 Education Funding
ROADMAP
Section I: What It Is:A Theoretical Framework
Section II: What’s Past is Prologue
Section III: What’s Going On
Section IV: What We Can Expect
Section V: Disrupting the Narrative
PLEASE REACH OUT ANYTIME!
Daniel G. Thatcher, J.D.National Conference of State Legislatures
Senior Fellow, Education720.648.6335 (m)
WHAT IT IS: THEORETICAL FRAMEWORKSECTION I
EDUCATION FINANCE PRINCIPLES
Stability (in revenue)
Sufficient (resources)
Fairness (for students, taxpayers and other stakeholders)
Transparency (for accountability and research)
Flexibility (to deliver resources where they’re most needed for the services/purposes needed in a time and place)
WHAT’S PAST IS PROLOGUESECTION II
THE GREAT RECESSION AND PUBLIC EDUCATION
Unprecedented impact
Districts with a greater dependence state revenue (and states that funded their systems with more state than local revenue) experienced greater vulnerabilities.
Shrinking property tax base offset by increases in property tax rates. Property taxes proved to still be a reliable revenue source.
Inequality in spending “rose dramatically.”
Federal State Fiscal Stabilization Fund (SFSF) shielded education from the worst effects of the GR.
Source: Evans, Schwab, and Wagner, “The Great Recession and Public Education.”
STATE REVENUE PERFORMANCE DURING THE GREAT RECESSION (SELECTED REVENUES)
bit.ly/NCSL-state-revenue-perf-GR
STATE REVENUE PERFORMANCE DURING THE GREAT RECESSION (SELECTED REVENUES)
bit.ly/NCSL-state-revenue-perf-GR
THE GREAT RECESSION’S DISPROPORTIONATE IMPACTS
Impact on Student Achievement
We find that the onset of the Great Recession significantly reduced student math and ELA achievement.
Recessionary effect on student achievement was concentrated among school districts serving more economically disadvantaged and minority students.
Adverse effects of the recession were not distributed equally among the population of U.S. students.
(Shores and Steinberg)
On average across states, high-poverty districts experienced an inequitable share of funding and staffing cuts following the Great Recession.
Changes in the income-based funding gap varied across states.
(Knight)
Source: Knight, “Are High-Poverty School Districts Disproportionately Impacted by State Funding Cuts?”; Shores and Steinberg, “The Impact of the Great Recession on Student Achievement.”
Impact on High-Poverty School Districts
STATE & LOCAL K-12 REVENUE
52
.0%
52
.8%
51
.8%
50
.0%
50
.6%
50
.5%
50
.0%
50
.8%
51
.0%
51
.4%
51
.1%
50
.9%
51
.0%
51
.1%
48
.0%
47
.2%
48
.2%
50
.0%
49
.4%
49
.5%
50
.0%
49
.2%
49
.0%
48
.6%
48
.9%
49
.1%
49
.0%
48
.9%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
20
07
20
08
20
09
20
10
20
11
20
12
20
13
20
14
20
15
20
16
20
17
20
18
NEA
Est
.
20
19
NEA
Est
.
20
07
-20
19 A
ve.
State % Local %
WHAT’S GOING ONSECTION III
WHERE ARE STATE REVENUES HEADING?
EDUNOMICS LAB: DISTRICT BUDGET DECISIONS & LABOR IMPLICATIONS
Source: Edunomics Lab, “District Budget Decisions & Labor Implications.”
LEARNING LOSS?
“Initial findings from NWEA are optimistic for reading but suggest unfinished learning in math, and raise equity concerns about missing data on students from underserved communities.”
Note: “Some differences by racial/ethnic groups are emerging in the fall 2020 data, but it is too early to draw definitive conclusions from these initial results. Student groups especially vulnerable to the impacts of the pandemic were more likely to be missing from our fall 2020 data.”
Source: Tarasawa, “Learning during COVID-19.”
“[T]hese children are ‘more likely to be black and brown, more likely to be from high-poverty schools and more likely to have lower performance in the first place.’”Source: Turner, “Coronavirus Impact On Students’ Math, Reading Growth.”
WHAT WE CAN EXPECTSECTION IV
DR. MARGUERITE ROZA’S ANALYSIS
District budgets were stable for SY2019–20, but…
Source(s): Roza, “What Will the Financial Turmoil Mean for Public Education?”Source(s): Roza, “What Will the Financial Turmoil Mean for Public Education?” https://edunomicslab.org/our-research/economic-downturn/; Burnette II, “Public Pensions Have Lost $1 Trillion in Value. That’s Bad News for Teacher Pay.”
Pensions lost $1 trillion in value (according to Moody’s)
DR. ROZA’S ANALYSIS
Source(s): Roza, “What Will the Financial Turmoil Mean for Public Education?”
CASCADE EFFECT?
Immediate impact (close of
FY2020)
•Sales tax revenue collections drop
•Unanticipated state/district expenditures
Impact within 2020 (SY2020–
21/FY2021)
•Personal income tax revenue drops + sagging sales tax revenue
•Continued COVID-19 emergency expenditures
•Medicaid enrollment increases
Impact on future fiscal and school years (SY2021–
22/FY2022)
“IF YOU HAVE TO FORECAST, FORECAST OFTEN.”
DISRUPTING THE NARRATIVESECTION V
SHOULD STATES FINANCIALLY TRIAGE DISTRICTS?
Potential harm to vulnerable school districts and students from state budget reductions can be avoided by considering these options:
Applying a sliding scale to account for differential student needs.
Accounting for differences in districts’ abilities to raise revenue.
Considering the length of the economic recession, as well as the potential availability of funds from other sources.
Considering lifting restrictions on resources for schools
SHOULD STATES FINANCIALLY TRIAGE DISTRICTS?
How can/should states identify most vulnerable children, school or districts or the ones most immediately in need?
Vulnerability = property poor districts w/high concentrations of poor families
Need = districts disproportionately impacted by COVID-19
Can granular, neighborhood-specific datasets be used to micro-target resources?
Opportunity Atlas (Chetty et al., https://opportunityatlas.org/)
Spatially Interpolated Demographic and Economic (SIDE) Estimates(Geverdt & Nixon, https://nces.ed.gov/programs/edge/Economic/NeighborhoodPoverty)
Stanford Education Data Archive (SEDA) (Reardon et al., https://edopportunity.org/)
After identifying vulnerabilities and needs, what should the state response be?
Source: Németh and Rowan, “Is Your Neighborhood Raising Your Coronavirus Risk?”
WHERE ARE OUR STUDENTS?
Reported enrollment declines between 2-4%. (Wolfe, Smith, and Jones, “The U.S. Passes 4 Million Cases in November Alone, Doubling October’s Tally”; )
General Student Count Mechanisms
Single Count Date – a count on one day near the beginning of the year
Multiple Count Dates – calculation based on two or more count dates during the year
Average Daily Attendance (ADA) – an average of a daily count during all or most of the year of students in attendance
Average Daily Membership (ADM) - an average of a daily count during all or most of the year of students enrolled
Single Count Period – an average of a daily count during a period of timenear the beginning of the year
Multiple Count Periods – an average of a daily count during two or more periods of time during the year
• Examples of states that apply the count to the current school year:Colorado (October 1 of current school year); Alaska (ADM); Nevada (last school day of first month of school year); Ohio (ADM of first week in October and first week in February).
• Examples of states that apply the count to the subsequent school year: Iowa (third Friday of the September of the prior year); Kentucky (prior year final ADA); Maine (October 1 and April 1 of year prior to the year of funding; Massachusetts (October 1 of previous year).
• Example of a state that applies counts from the current and previous years:Michigan (February count date from previous school year and September count date from current school year).
Questions and Answers
Please “raise your hand” or type your questions into the chat box on the right side of your screen.
LESSONS FROM THE GREAT RECESSION
Why did inequality increase during the Great Recession?
How can the impacts on vulnerable children, families and communities be mitigated?
How can states make “equitable cuts” or preserve what equity exists in their current finance systems?
EDUCATION RESOURCES
▪ K-12 Resourceshttps://www.ncsl.org/research/education/education-finance-in-the-time-of-covid-19.aspx
▪ Higher Education Resourceshttps://www.ncsl.org/research/education/higher-education-responses-to-coronavirus-covid-19.aspx
▪ Education Bill Trackinghttps://www.ncsl.org/research/education/covid-19-education-bill-tracking-database.aspx
PRESENTATION SOURCES
Atchison, Drew. “COVID-19 and the Squeeze on State Education Budgets: Equity Implications for New York State.” Washington, DC: American Institutes for Research, May 11, 2020.
Baker, Bruce D., and Matthew Di Carlo. “The Coronavirus Pandemic and K-12 Education Funding.” Washington, D.C.: Shanker Institute, April 24, 2020.
Barnum, Matt. “School Budgets Are in Big Trouble, Especially in High-Poverty Areas.” Chalkbeat. April 7, 2020.
Blagg, Kristin, Erica Blom, Megan Gallagher, and Macy Rainer. “Mapping Student Needs during COVID-19.” Urban Institute, April 28, 2020.
California Department of Finance. “The COVID-19 Pandemic and California’s Budget Outlook.” Fiscal Update. Sacramento, Cal.: Author, May 7, 2020.
Chetty, Raj, John N. Friedman, Nathaniel Hendren, Maggie Jones, and Sonya Porter. “The Opportunity Atlas: Mapping the Childhood Roots of Social Mobility.” Executive Summary. Cambridge, Mass.: Opportunity Insights and the U.S. Census Bureau, October 2018.
———. “The Opportunity Atlas: Mapping the Childhood Roots of Social Mobility.” Cambridge, Mass.: National Bureau of Economic Research, October 2018.
Dadayan, Lucy. “State Revenue Forecasts Before Covid-19 and
Directions Forward.” Washington, D.C.: Urban-Brookings Tax Policy Center, April 2, 2020.
———. “The Impact of the Great Recession on Local Property Taxes.” Rockefeller Institute Brief. Albany, N.Y.: The Nelson A. Rockefeller Institute of Government, July 2012.
Darling-Hammond, Linda. “The Urgency of Reopening Schools Safely.” Forbes, July 21, 2020, sec. Opinion.
Education Partners Project, and National Conference of State Legislatures. “Principles of a Sound State School Finance System.” Item #3132. Denver, Colo.: NCSL, July 1996.
Edunomics Lab. “District Budget Decisions & Labor Implications.” Tableau Software. Edunomics Lab at Georgetown University, August 26, 2020.
Geverdt, Doug, and Laura Nixon. “Sidestepping the Box: Designing a Supplemental Poverty Indicator for School Neighborhoods.” NCES 2017-039. Washington, D.C.: National Center for Education Statistics, Institute of Education Sciences, U.S. Department of Education, November 2018.
Goldstein, Jessica, and Josh B. McGee. “Did Spending Cuts During the Great Recession Really Cause Student Outcomes to Decline?” EdWorkingPaper. Providence, R.I.: Annenberg Institute at Brown University, October 1, 2020.Full list here: bit.ly/2VBAtQR
PRESENTATION SOURCES
Griffith, Michael. “COVID-19 and School Funding: What to Expect and What You Can Do.” LPI Blog - Learning in the Time of COVID-19 (blog), August 7, 2020.
———. “What Will It Take to Stabilize Schools in the Time of COVID-19?” Learning in the Time of COVID-19 (blog), May 7, 2020.
Hanushek, Eric A., and Ludger Woessmann. “The Economic Impacts of Learning Losses.” EdWorkingPaper. Providence, R.I.: Annenberg Institute at Brown University, September 10, 2020.
Hartney, Michael T., and Leslie K. Finger. “Politics, Markets, and Pandemics: Public Education’s Response to COVID-19.” EdWorkingPaper. Providence, R.I.: Annenberg Institute at Brown University, October 2, 2020.
Hess, Rick. “What Will the Coronavirus Mean for Ed. Finance?” Education Week - Rick Hess Straight Up (blog), April 10, 2020.
Holtz-Eakin, Douglas, and Tom Lee. “The Economic Benefits of Educational Attainment.” Washington, D.C.: American Action Forum, June 4, 2019.
Irons, Meghan E. “Teachers Brace for Layoffs in Unprecedented Times.” The Boston Globe. June 8, 2020, Online edition.
Jackson, C. Kirabo, Cora Wigger, and Heyu Xiong. “Do School Spending Cuts Matter? Evidence from the Great Recession.” Unpublished Paper, 2018.
Johnson, Angela, and Megan Kuhfeld. “Fall 2019 to Fall 2020 Map Growth Attrition Analysis.” Technical Brief. Portland, Ore.: NWEA,
November 2020. Knight, David S. “Are High-Poverty School Districts
Disproportionately Impacted by State Funding Cuts?: School Finance Equity Following the Great Recession.” Journal of Education Finance 43, no. 2 (2017): 169–94.
MacKellar, Erica, and Emily Maher. “Coronavirus (COVID-19): Revised State Revenue Projections.” National Conference of State Legislatures, August 14, 2020.
Mahnken, Kevin. “What the Great Recession Tells Us About the Pandemic Downturn to Come: Expect Declining Student Performance, Widening Achievement Gaps.” The 74, March 26, 2020.
Mitra, Dana. “Pennsylvania’s Best Investment: The Social and Economic Benefits of Public Education.” Education Law Center, June 2011.
Murphy, Mary, Alexandria Zhang, and Akshay Iyengar. “States’ Tax Portfolios Drive Differences in Revenue Volatility: What Different Tax Types Mean for Fiscal Stability.” Washington, D.C.: The Pew Center on the States, October 16, 2017.
National Association of State Budget Officers. “State Expenditure Report: Fiscal Years 2017–2019.” State Expenditure Reports. Washington, D.C.: NASBO, November 21, 2019.
Full list here: bit.ly/2VBAtQR
PRESENTATION SOURCES NEA Research. “Rankings of the States 2019 and Estimates of School
Statistics 2020.” Washington, D.C.: National Education Association, July 2020.
Németh, Jeremy, and Sarah E. Rowan. “Is Your Neighborhood Raising Your Coronavirus Risk? Redlining Decades Ago Set Communities up for Greater Danger.” The Conversation, May 26, 3020.
Reardon, Sean. “The Educational Opportunity Project at Stanford.” The Educational Opportunity Project at Stanford University. Accessed August 25, 2020.
Reschovsky, Andrew. “The Impact of State Government Fiscal Crises on Local Governments and Schools.” State and Local Government Review36, no. 2 (August 2004): 86–102.
Roza, Marguerite. “How the Coronavirus Shutdown Will Affect School District Revenues.” Brookings Center Chalkboard (blog), April 9, 2020.
———. “What Will the Financial Turmoil Mean for Public Education? Part 3.” Webinar presented at the Edunomics Lab Webinar Series, May 28, 2020.
Segarra, Marielle. “A 2018 Supreme Court Tax Decision Is Helping State Budgets during the Pandemic.” Marketplace. September 3, 2020.
Stelitano, Laura, Sy Doan, Ashley Woo, Melissa Diliberti, Julia H. Kaufman, and Daniella Henry. “The Digital Divide and COVID-19: Teachers’ Perceptions of Inequities in Students’ Internet Access and Participation in Remote Learning.” Santa Monica, Cal.: RAND Corporation, September 24, 2020.
Tarasawa, Beth. “Learning during COVID-19: Initial Research Findings and 5 Things We Can Do.” Teach. Learn. Grow. (NWEA Education Blog)
(blog), December 1, 2020. Thatcher, Daniel G. “State and Local Revenue Performance During the
Great Recession.” Power BI Data Visualization. National Conference of State Legislatures, August 2020.
Thatcher, Daniel G., and NCSL. “Education Finance Fellows.” College and Career Readiness State Legislation, November 10, 2017.
Turner, Cory. “Report: Coronavirus Impact on Students’ Math, Reading Growth.” NPR. December 1, 2020, Morning Edition.
West, Martin R. “What Financial Turmoil Will Mean for Public Education.” EdNext Podcast, April 1, 2020.
“What Will It Cost to Reopen Schools?” Data Visualization. ASBO International & AASA, June 3, 2020.
Willis, Jason, and Sean Tanner. “Fair and Equitable Reductions to State Education Budgets: Evidence and Considerations for the 2020/21 Fiscal Year.” San Francisco, Cal.: WestEd, May 2020.
Willis, Jason, Sean Tanner, and Justin Silverstein. “Loosening the Reins: Evidence and Considerations for Lifting Restrictions on Resources for Schools.” Policy Perspectives. San Francisco, Cal.: WestEd, August 2020.
Barry, Ellen. “U.S. Public School Enrollment Drops as Parents, Frustrated by Lockdown, Pull Their Children Out.” The New York Times. November 28, 2020, sec. World.
Full list here: bit.ly/2VBAtQR
