Ķvlog

Education Funding

How States Are Rethinking Where School Funding Should Go

By Mark Lieberman — February 23, 2024 7 min read
Conceptual illustration of tiny people is planning the personal budget, accounting, analysis.
  • Save to favorites
  • Print
Email Copy URL

The Staunton schools in Virginia employ roughly 530 people. But according to the state, they only need 200.

That means the state only contributes to the cost of salaries for roughly 40 percent of the district’s staff. And even then, the state pays for only 40 percent of those 200 staff members’ salaries.

All told, the Staunton district spends $34 million, or $12,630 per student, on staffing. Local taxpayers cover half those costs.

This discrepancy is the result of a complex K-12 school funding formula that the state , and applies decades-old assumptions about school staffing and student services to schools operating in the 2020s.

“It’s a trainwreck, and it’s been underserving the school divisions for a long time now,” said Brad Wegner, budget director for the Staunton district.

An commissioned by the legislature and published last July called for a major overhaul of the formula.

But the most recent state budget proposal by Gov. Glenn Youngkin, a Republican, doesn’t include any of the measures recommended in the report. Youngkin has said he backs the plan to revise the formula, and lawmakers .

Virginia is just one state where policymakers, researchers, and advocates have identified problems with the equations, weights, and other statistical measures their states use to figure out how much money schools get each year.

State funding formulas for K-12 schools are notoriously messy and complex. Policymakers, researchers, advocates, school district leaders, community groups, and parents are rarely in lockstep over how they should work.

To the public, and even to the lawmakers who execute them, they’re often inscrutable. And they’re always subject to change.

“You get what you get. No one really understands it,” Wegner said of Virginia’s formula. “I don’t think there’s any one person who could lay out the whole budget template that we get from the state, how all that math works.”

See Also

one woman and two men with a large calculator and next to large stacks of bills and coins.
DigitalVision Vectors/Getty
Education Funding 4 Ways States Are Trying to Fix How They Fund Schools
Mark Lieberman, February 14, 2023
6 min read

Changes might not be happening this year in Virginia, but here are a few ways other states are looking to revamp their funding formulas for K-12 schools.

Adding weights for marginalized groups

The growing consensus in recent years among education researchers is that schools need more money to successfully educate students from low-income families, students of color, and English learners.

However, some funding formulas don’t dedicate extra money to students in the state who fit into those categories.

Others devote additional funds to some categories of students but not others, or they draw on data that’s out of date.

  • Colorado’s current formula allocates funds primarily based on the size of the district and the cost of living in the surrounding community. The number of students who live in poverty doesn’t factor in nearly as much. Legislators have that would send districts significantly more money per student overall, and more weighted funding for students in poverty.
  • In Delaware, a prompted by a school funding lawsuit found that students in high-need groups—English learners, students with disabilities, students living in poverty—were receiving between $4,000 and $6,000 per student less than the recommended investment in services for those populations. State lawmakers there have examined the reports but recently said they .
  • Lawmakers in New Jersey want to —two areas where many districts have seen dramatic cost increases in recent years, thanks to inflation and a rise in the number of students requiring special education services.
  • In Nevada, advocacy groups and some school leaders are worried after the number of students deemed “at risk” dropped by 75 percent after the state changed the source of that figure. The state is caught up in an ongoing debate over which categories of students need extra funding, and how to identify them.

Removing archaic and outdated components

Funding formulas are so complex and rife with political and administrative land mines that efforts to revise them often take years or even decades.

That’s especially problematic when the formulas include assumptions drawing on outdated figures for factors like salaries and population trends.

  • Mississippi’s “27% Rule” with local dollars at 27 percent of its overall annual budget. The rule is designed to help ensure low-wealth districts receive plenty of state aid. But it also means districts in higher-wealth areas that can raise more local revenue end up spending drastically more on education than their lower-wealth counterparts, because districts can chip in additional local funds beyond the 27 percent share. State lawmakers have recently signaled a desire to .
  • During the Great Recession, Virginia capped the number of support staff schools could hire to keep costs manageable, according to the state-mandated school funding report. But many of those caps remain in place, even as economic conditions and students’ needs have drastically changed.
  • Alaska’s school funding formula includes a provision known as the . To qualify for federal aid for school districts on government land, the state must demonstrate a gap of less than 25 percent in per-student spending between the highest- and lowest-funded districts, excluding outliers in either direction. If the state passes, it can use the federal impact aid in place of an equivalent amount of state money for schools. Districts have , allowed under federal law, arguing it leads to diminished funding for schools in the highest-need areas.
  • Oregon currently caps its special education funding for schools at 11 percent of a district’s student population. Washington state has a similar cap of 15 percent. However, many districts have a significantly higher percentage of students who need those services. Lawmakers in both states are that would to pay for costly special education services that are mandated by federal law.
  • New York City schools last year were receiving extra aid for homeless students based on a citywide count that took place at the end of 2022. But an influx of new families seeking shelter in 2023 meant schools faced much higher needs than they could pay for with the allocated funds. City officials have since after months of delay, resulting in $9 million of additional weighted funding for schools to support homeless students.

Fundamental changes in strategy

Some funding formula tweaks affect only one piece of a much larger puzzle. For instance, several states including Colorado and are in the process of deciding how much to annually increase the base amount of aid schools get from the state before other parts of the formula are factored in.

Others aim to transform how the system works.

  • In New Hampshire, that would calculate the amount of money a school district would need to achieve an optimal level of performance—including benchmark assessment scores and attendance and graduation rates. The current system gives money to districts that can’t raise enough to cover their budget using the state’s mechanism for raising property taxes. A judge last year, however, declared that system unconstitutional and urged the legislature to make substantial changes to more than double the amount of state aid schools get per student.

    See Also

    Image of money symbol, books, gavel, and scale of justice.
    DigitalVision Vectors
  • Most states calculate school funding using a system that assesses the needs of students. But a handful, including Virginia, rely on a different model, with funding driven by the number of staff a school has and needs. “That system just isn’t very effective,” said Wegner, the Staunton district’s budget director. Researchers who studied the formula argue a student-centered formula may be more effective at targeting resources.
  • Determining a district’s number of students is itself a major challenge states continue to grapple with. Most use enrollment figures as the basis for their calculations. But . Efforts to permanently shift states away from attendance counts, which can miss chronically absent students who may benefit from extra financial support for their schools, continue to crop up from time to time, most recently in Texas.

Events

This content is provided by our sponsor. It is not written by and does not necessarily reflect the views of Education Week's editorial staff.
Sponsor
Artificial Intelligence Webinar
Managing AI in Schools: Practical Strategies for Districts
How should districts govern AI in schools? Learn practical strategies for policies, safety, transparency, as well as responsible adoption.
Content provided by 
This content is provided by our sponsor. It is not written by and does not necessarily reflect the views of Education Week's editorial staff.
Sponsor
Reading & Literacy Webinar
Unlocking Success for Struggling Adolescent Readers
The Science of Reading transformed K-3 literacy. Now it's time to extend that focus to students in grades 6 through 12.
Content provided by 
Jobs Virtual Career Fair for Teachers and K-12 Staff
Find teaching jobs and K-12 education jubs at the EdWeek Top School Jobs virtual career fair.

EdWeek Top School Jobs

Teacher Jobs
Search over ten thousand teaching jobs nationwide — elementary, middle, high school and more.
Principal Jobs
Find hundreds of jobs for principals, assistant principals, and other school leadership roles.
Administrator Jobs
Over a thousand district-level jobs: superintendents, directors, more.
Support Staff Jobs
Search thousands of jobs, from paraprofessionals to counselors and more.

Read Next

Education Funding Arts Education Advocates Talk About How to Elevate Their Discipline
Art education community members come together to discuss funding challenges and opportunities.
3 min read
DSC 4497
WASHINGTON, DC - MARCH 24: National arts education leaders, advocates, and policymakers gather for a couple of hours at the University Club on March 24, 2026 in Washington.
Marvin Joseph for Education Week
Education Funding Common Questions About Education Funding
Education Week has answered some of the most common questions about education funding in the United States.
1 min read
MINNEAPOLIS, MN, January 22, 2026: Students at Washburn High School fill the stairwell during passing time in Minneapolis, MN.
MINNEAPOLIS, MN, January 22, 2026: Students at Washburn High School fill the stairwell during passing time in Minneapolis, MN.
Caroline Yang for Education Week
Education Funding Federal Funding Disruptions for Schools Are Far From Over
Signs are piling up that schools could experience more funding turbulence in the coming months.
12 min read
President Donald Trump speaks during a roundtable discussion on college sports in the East Room of the White House, Friday, March 6, 2026, in Washington.
President Donald Trump during a recent roundtable discussion in the East Room of the White House, on March 6, 2026, in Washington. Trump's administration is using new ways to incorporate its policy priorities into grantmaking that will affect schools and other recipients of other grants.
Julia Demaree Nikhinson/AP
Education Funding School Mental Health Projects Get 3-Month Reprieve as Court Rules Against Trump
The projects to expand school-based services have faced nearly a year of funding uncertainty and legal limbo.
5 min read
A student adds a note to others expressing support and sharing coping strategies, as members of the Miami Arts Studio mental health club raise awareness on World Mental Health Day, Tuesday, Oct. 10, 2023, at Miami Arts Studio, a public 6th-12th grade magnet school, in Miami.
A student adds a note expressing support and sharing coping strategies during a World Mental Health Day activity on Oct. 10, 2023, at Miami Arts Studio, a magnet school in Miami. Most recipients of two federal school mental health services grants the Trump administration has attempted to cancel over the past year will see their funding continue at least through June 1.
Rebecca Blackwell/AP