Studies have shown that education finance reform that addresses funding equity can improve educational—and life—outcomes, such as higher wages and a lower incidence of adult poverty. The Every Student Succeeds Act (ESSA) provides education leaders with an opportunity to evaluate the fairness of their funding practices.

This action guide provides information and resources to support state and local school leaders working to distribute funds fairly and ensure their dollars are spent wisely, with the ultimate goal of closing achievement gaps and improving outcomes for all students.

Actions for Education Leaders on ESSA’s Financial Transparency Provisions

The guide includes three actions to help state and local education leaders evaluate and improve the fairness of education funding and resource distribution.

Action 1: Engage Stakeholders to Build Their Capacity Around Per-Pupil Expenditure Data

Starting in the 2018-19 school year, ESSA requires schools and districts to report school-level, per-pupil spending on their annual state report cards, providing a new source of data on funding. AIR experts encourage districts to use this new data source to engage school leaders, parents, the community, and other stakeholders in various ways, including:

• Helping district and school leaders understand how to interpret and use the data;
• Providing stakeholders with a list of example questions to ask their school and district leaders about what the data show; and
• Hosting district- and/or school-level meetings with parents and community stakeholders to share this new funding data, answer questions, and have meaningful discussions about what the data show and how to improve or maintain funding equity.

Action 2: Connect Resource Allocation Reviews to School Improvement Efforts

ESSA also requires districts with low-performing schools to conduct a comprehensive needs assessment. This provides an opportunity for district and school leaders to candidly examine how resource allocation—including nonfinancial resources like staff experience and qualifications and course offerings—influence students’ educational opportunities and outcomes.

The connection between resource allocation and student achievement can be examined by answering the following questions:

• To what degree does the existing allocation of resources match the priorities included in our school improvement plan?
• In what ways are we over- or underutilizing any of our existing resources in supporting the improvement of low-performing schools?
• How can we improve our resource allocation planning and decision-making in the future? In other words, are resources currently being allocated in a cost-effective manner?

Action 3: Examine Your Approach to Funding Schools

ESSA also provides districts with the opportunity to engage in a pilot of student-centered funding programs, or weighted student funding. In such systems, more dollars go to schools serving students with additional needs. These models are intended to improve equity and transparency of resource allocation and provide school leaders with flexibility to apply funding to best meet the needs of their students.

To evaluate whether a weighted student funding system might help improve equity, transparency, and flexibility, AIR experts suggest district leaders:

• Evaluate the strengths and weaknesses of the current school resource allocation system and whether the system aligns with district and state priorities;
• Consider what it would take to implement a weighted student funding system and discuss the positive aspects of such challenges related to implementing such a system; and
• Pilot a weighted student funding system using a subset of schools within the district to determine if it would be appropriate and create tighter alignment between resource allocation and district priorities.