Title I

Encouraging Spending on Parental Outreach for SES

Lindsey Luebchow — Mon, 28 Apr 2008 15:00:00 -0400

Many low-income parents with children in low-performing schools are not taking advantage of free tutoring available to them under No Child Left Behind. Under NCLB's "Supplemental Educational Services" (SES) provision, school districts that fail to meet academic benchmarks for three years must set aside part of their federal Title I grant to provide outside tutoring—but only a fraction of eligible students are using the program.

The Department of Education is trying to figure out how to increase take-up rates for the SES program. As part of a package of new NCLB regulations, the Department proposed this week that districts should be able to use part of their SES funding set-aside to conduct outreach activites to educate parents about the program (this currently isn't allowed). This is a logical, beneficial addition to the SES provision that hopefully will encourage districts to implement more intensive, effective ways to inform parents about SES.

Low Levels of SES Participation...

In the 2003-04 school year, 1,377,000 students were eligible for SES (eligible students are low-income students who are enrolled in schools that have failed to make Adequate Yearly Progress (AYP) for three consecutive years). But only 233,000 of those students—a mere 17 percent of eligible students nationwide—participated in SES, according to the most recent National Assessment of Title I.

Other studies of individual states and districts have found similarly low participation rates. While the overall number of students participating in SES has increased in recent years, this is a result of the rising number of failing schools and eligible students, not take-up (see graph to right).

...and Spending

NCLB requires school districts to set aside 20 percent of their Title I grants for SES and school choice (low-income students can also choose to transfer to another school after two years of AYP failure by their school). Administrative costs, such as parental outreach, cannot be included in the 20 percent. If a district does not spend the entire 20 percent set-aside—either because not enough students are eligible or because not enough students choose to participate—it can reallocate the remaining funds to other Title I activities.

A GAO report estimated that districts nationwide spent 42 percent of the total amount set aside for SES in 2004-05. Of course, spending on SES varies from district to district, and in some districts—primarily large, urban districts with significant numbers of failing schools and eligible students—the demand may exceed the funding available for SES. But this is not the norm (in this case, districts must prioritize the lowest-achieving students). In 2004-05, the GAO estimated that 16 percent of districts could not provide SES to all students who requested it with their 20 percent set-aside. In the majority of school districts, SES funds are under-utilized, allowing districts to redirect the unused SES money to other purposes.

Increasing Participation Takes Effort, and Money

Free tutoring should be an appealing option to most parents, so why does only one out of every five eligible students nationwide take advantage of the SES program? Most case studies find that the main obstacle is inadequate parental outreach and engagement.

NCLB requires districts to "promptly provide to a parent or parents (in an understandable and uniform format and, to the extent practicable, in a language the parents can understand) of each [eligible] student...an explanation of the parents' option to obtain SES." This typically means that districts send a letter to parents of eligible students at the beginning of the year.

These letters often fail to explain the SES option in a clear, understandable way. And in some cases they are lost because of high mobility rates for low-income families. In addition, parents can find the task of choosing a SES provider and filling out the requisite paperwork overwhelming. Because districts cannot include administrative costs in their 20 percent set-aside spending, many are discouraged from taking more extensive and effective, but also more expensive, actions to notify parents.

For example, some proactive districts have used a variety of strategies to increase SES take-up. They have: called, visited at home, or held meetings at school with parents; hosted informational events such as SES fairs at which parents can explore provider options; worked with outside community organizations or churches to raise awareness; bought advertisements on radio, television, or billboards, etc.

Given the widespread information problems, it's commonsense to allow districts to use a small portion of the 20 percent set-aside to figure out how to engage more parents and students. The Department proposes allowing districts to spend up to 0.2 percent of the overall Title I grant on parental outreach, or 1 percent of the 20 percent set-aside. In addition, districts that are under-utilizing their SES and school choice funds should be given other options to support low-income children in failing schools: for example, New America's Early Education Initiative, has proposed allowing districts to spend part of this money on high-quality pre-kindergarten for 3- and 4-year olds.

The Department recognizes that many low-income students in low-performing schools are not getting the additional academic support envisioned by NCLB. Encouraging districts to spend more money on parental outreach is a positive step toward reaching more of these students. Next up is accountability: the Department needs to show, conclusively, that this significant federal investment in SES is having a positive effect on student achievement. More to come on SES effectiveness from Ed Money Watch.

Tired of Waiting for Reauthorization, the Department of Education Regulates

Lindsey Luebchow — Thu, 24 Apr 2008 17:00:00 -0400

On Tuesday, the Department of Education unveiled a new set of proposed regulations on No Child Left Behind. The major announcement was details about the new, uniform graduation rate formula that all states will have to use for NCLB accountability purposes going forward. In addition, the Department outlined new requirements for district implementation of the Supplemental Educational Services (SES) provision.

In general, the proposed regulations focus on greater transparency for what's already happening in each state. At a briefing in Washington D.C., U.S. Deputy Secretary of Education Ray Simon said that the Department wants to make sure states and districts can justify what they are doing on assessment and accountability. He also raised concerns that districts are not adequately implementing NCLB's restructuring and SES requirements, and said that the Department wants to detail and reinforce what is already required by the law.

Here's a quick summary of the new proposed regulations, which were published today in the Federal Register and will be open for comment for 90 days:

Uniform Graduation Rates

By 2012-13, states, districts, and schools would have to use a "cohort graduation rate" formula, consistent with the National Governor's Association's formula.
Because it will take time for many states to collect the necessary data, they would have to use an "averaged freshman graduation rate" (AFGR) in the interim.

Adequate Yearly Progress (AYP): States currently require schools to show some improvement (generally only a minimal amount) in graduation rates in order to make AYP under NCLB. The Department wants to require that states set a specific goal and a timeline for improvement in graduation rates.

Disaggregation: By 2012-13, states would also have to report disaggregated graduation rates and use them in AYP calculations. In the meantime, disaggregated AFGR rates would have to be reported; however, because the AFGR is not accurate enough for small data groups, disaggregation would not be used for accountability purposes at the school level until the more accurate rate is available.
Transparency & Clarification
"N" Size: States are currently allowed to set their own minimum subgroup sizes ("N" sizes) for AYP reporting. The Department is concerned that too many students are being excluded in some states with large N sizes, and proposes requiring states to justify their N sizes and other technical AYP components in their accountability workbooks. These explanations would then undergo a peer review.

Restructuring: The Department wants to clarify school restructuring requirements, which it believes aren't being effectively implemented. Districts would have to show that schools in the restructuring phase are receiving much more comprehensive, tailored interventions than schools in earlier, corrective action phases.
Supplemental Education Services and School Choice
Parental Notification: Schools would have to notify parents of their school choice options at least 14 days before the start of the school year. When schools send out notices of SES eligibility, they would have to be "clearly distinguishable" from other NCLB information.

State Approval and Monitoring: The Department wants states to provide more information about how they approve and evaluate SES providers. In addition, the Department wants to expand the list of factors that a state must take into account when approving or monitoring the effectiveness of providers.

Title I Funds: Districts are not allowed to count the costs of parental outreach towards the 20 percent of their Title I grant that must go to SES and school choice. The Department proposes permitting districts to count those costs, up to 0.2 percent of the total Title I allocation. In addition, districts would have to prove that they have sufficiently exhausted SES and school choice opportunities before they could reallocate any remaining funds to other purposes.

Does Title I Funding Go Holy to Fund Private School Students?

Lindsey Luebchow — Thu, 17 Apr 2008 14:00:00 -0400

Pope Benedict XVI's first visit to the United States is spurring supporters of Catholic schools and the media to highlight the decline of and obstacles facing Catholic schools. Demographic changes, a reduced supply of priests and nuns to serve as teachers, and the aftermath of sex abuse scandals have acted to undermine Catholic schooling in many places. This attention to the crisis in Catholic education has also highlighted a little known fact: federal education programs provide support to educate low-income students not just in public schools, but also in private schools.

When spending federal money, school districts are required to provide equitable services to private school students and teachers. The Elementary and Secondary Education Act—Title IX, Part E, Subpart 1—enshrines this right to equitable services. Ed Money Watch will use the Pope's visit as an opportunity to clarify how federal funds are distributed to and spent on private school students and teachers (not private schools).

Title I Funds for Supplemental Instruction

NCLB requires school districts to evenly distribute their Title I funds among eligible, poor students in both public and private schools (those private schools that choose to participate). Districts do not distribute Title I funds directly to private schools (as they do for public schools), however, but rather use the per-pupil Title I allocation to pay for support services for private school students.

Typically, this means district provide supplementary instruction for private students, delived either by public school teachers or through a third-party contractor. For example, eligible students may receive targeted, pull-out sessions in school, in computer labs, or through outside counseling or tutoring. Districts have to consult with the private schools to design and implement a program that will meet the needs of the eligible students. Other Title I services and programs, such as professional development for teachers of Title I students, follow the same model, as does the Reading First program.

According to the most recent National Assessment of Title I, one percent of Title I funds in 2004-05 provided services for 188,000 private school students. Given that most of these students were likely in elementary school, this represents about five percent of the total 3.7 million K-8 private school population. In 2005-06, 16 percent of all private schools, and 37 percent of Catholic schools, reported participating in Title I (vs. 56 percent of all public schools in 2004-05).

Other Federal Money for Private School Students

Other federal elementary and secondary education programs are also subject to the same mandate of equitable services for private school students and teachers, because they are governed by the Uniform Provisions in Title IX, Part E of NCLB:

[The district] shall, after timely and meaningful consultation with appropriate private school officials provide to those children and their teachers or other educational personnel, on an equitable basis, special educational services or other benefits that address their needs under the program.

For example, when distributing its Title II teacher training funds, a district must provide the same professional development opportunities to public and private school teachers.

Private school students are also eligible to receive funding from the National School Lunch Program and Individuals with Disabilities Education Act (IDEA) grants. If students qualify for free or reduced price lunch (their family's income is below 185 percent of the poverty line), their private school can apply for cash reimbursements from the program for each meal served to an eligible student. Private schools approved by the Department of Education can receive federal IDEA funds from the district, proportionate to their share of special education students.

Under-Utilization of Federal Funds

While there is a fair amount of federal money available to private schools, particularly those serving low-income children, not all private schools take advantage of these federal funds. This means that the number of private school students eligible for federal support is higher than the number who actually receive federal services—and the amount of federal money going to private schools is lower than it could be.

There are several reasons why private schools do not make use of all available federal funding. First, federal money comes with a lot of federal requirements. For example, the School Lunch Program has nutritional requirements for its meals, and every school must adopt a wellness policy with nutrition goals. IDEA has specific "individualized education plan" (IEP) requirements for disabled students who receive federal funds.

In addition, some private schools choose not to expend the administrative effort necessary to obtain federal money. For example, for private school students to receive Title I services, their schools have to negotiate and set up arrangements with the district. And private schools must deal with state Departments of Education in order to receive school lunch reimbursements. Some private schools don't have the administrative capacity for this, and many conclude the money is worth the bother.

President Bush is convening a White House summit on inner city children and faith-based schools sometime this spring, at which these federal funding issues will likely be discussed. It's unlikely, however, that anything substantive will change with federal funding of private schools in the near future—unless John McCain decides to make increased federal support for private schools a part of his campaign agenda.

Navigating the Rocky Road of School Improvement Funding

Lindsey Luebchow — Tue, 15 Apr 2008 15:00:00 -0400

As the number of schools identified for school improvement, corrective action, and restructuring under the No Child Left Behind Act continues to increase, states are under increasing pressure to improve student performance in these schools. Yet a new report from the Government Accountability Office finds that a little-known funding provision in NCLB is undermining state efforts to turn around low-performing schools.

The 4% Set-Aside vs. the Hold Harmless Provision

Under NCLB, schools that fail to meet state achievement benchmarks—otherwise known as Adequate Yearly Progress or AYP—for two consecutive years enter "school improvement" status. NCLB requires states to set aside four percent of their Title I funds to support school improvement activities—such as professional development, new curriculum, extended learning time, or full-scale restructuring—in these schools.

Yet many states are not able to reserve the full four percent of their Title I funds for school improvement, because a separate provision of the law prevents them from doing so. NCLB includes a "hold-harmless" provision that prevents states from reducing a school district's Title I funding more than 5 to 15 percent below the previous year's level as a result of the set-aside. States have to fulfill this obligation before reserving any funding for school improvement.

Title I funds are allocated to school districts through a formula that is based primarily on the number of poor children they enroll. The hold-harmless provision protects school districts from Title I funding cuts if their proportionate share of poor children declines. In practice, that means giving more money to such districts than the Title I formulas would allocate otherwise. After meeting hold-harmless requirements, some states have less than four percent of Title I funds left over to support school improvement.

The Result: Less, Unpredictable School Improvement Funding

According to a new report by the Government Accountability Office, 22 states have not been able to spend the full four percent of their annual Title I allocations on improvement activities for at least one year since 2002. A separate, earlier report by the Center for Education Policy found that 29 states would be unable to meet the four percent set-aside in 2007-08.

In theory, states should spend four percent of their Title I funds—a total of about $500 million out of the $12.8 Title I appropriation for fiscal year 2007—on school improvement. But the Center for Education Policy estimates that $192 million of that $500 million will be lost because of the hold-harmless provision.

Moreover, the amount of money states have to spend to satisfy hold-harmless requirements is unpredictable from year to year, depending on the amount of money that Congress appropriates for Title I and demographic changes across and within states. This instability makes it difficult for low-performing schools to implement coherent, long-term school reforms, as the amount of money they receive to support these efforts often fluctuates each year. Some states have compensated by finding other funding sources for school improvement activities. For example, states have used federal funds from the Comprehensive School Reform program, Reading First, and Improving Teacher Quality State Grants to support school improvement efforts. In addition, 17 states have used their own funds to help sustain improvement activities in low-performing schools.

Eliminating the Hold Harmless Provision

The Department of Education has recognized these problems with the four percent set-aside. The administration's 2007 budget request proposed eliminating the hold-harmless provision so that federal school improvement funding would stabilize at four percent of overall Title I funding.

As the GAO report points out, there has been little analysis of how the hold harmless provision affects different types of school districts. The Department claims that the provision is keeping too much federal money in lower-poverty school districts, and harming high-poverty, low-performing districts by leaving less money for them and for school improvement activities.

But this is all hypothesis. For years hold harmless provisions in Title II of NCLB protected districts throughout Mississippi from experiencing dramatic funding declines, whereas low-poverty but high-growth districts in California were slated for increases. GAO recommends that the Department of Education "develop an analysis comparing the characteristics of districts that contribute to the set-aside with those protected by the hold-harmless provision." The Department agreed with this recommendation. Congress will need to address this issue when it resumes reauthorization of NCLB legislation—and the Department must ensure it has the facts and data to make informed decisions about these policies.

A Separate School Improvement Funding Stream

The fiscal year 2007 budget also provided funding to support "School Improvement Grants" to states to supplement the four percent set-aside. Although NCLB authorized these grants, the Bush administration did not request funding for them until fiscal year 2007. Congress funded the program in fiscal year 2007 at $125 million and increased funding to $491 million in the current fiscal year. In order to receive the grants, which are distributed in proportion to each state's Title I allocation, states must submit an application and meet some additional reporting and accountability requirements.

As the four percent set-aside shrinks in many states, School Improvement Grants are an important source of additional federal funding needed to sustain school improvement activities in low-performing schools. The Bush administration has requested level-funding for this program in fiscal year 2009—even as the number of schools in school improvement status rises (8,400 in 2004-05 to 10,700 in 2006-07). In the near term, Congress must continue to fund, and possibly even expand, the School Improvement Grants program. It must also make sustained funding to support school turnaround efforts a key priority in the NCLB reauthorization.

Loophole Makes School Finance Inequity Within Districts Possible

Ed Policy — Tue, 19 Feb 2008 00:00:00 -0500

When the federal government started distributing compensatory education (i.e. Title I) funding in 1965, it wanted to ensure that federal money was supplementing, not supplanting, support to schools educating disadvantaged children. Thus, the government added fiscal requirements to Title I of the Elementary and Secondary Education Act that require communities to establish an even state and local school finance playing field within district — before supplemental Title I money is given to the highest-poverty schools.

For a school district to be eligible for federal funds under Title I, Part A of the Elementary and Secondary Education Act, it has to fulfill three fiscal requirements:

Maintenance of effort
School districts must maintain expenditures from state and local funding sources from year to year.
Comparability of services
School districts must provide services in Title I (high-poverty) schools that are at least comparable to the services provided in non-Title I (low-poverty) schools.
Supplement, not supplant
School districts must use Title I funds to supplement the activities supported by state and local funds that would have taken place in the absence of federal funds.

In theory, the "comparability" requirement has the greatest potential to help low-income students and schools. It's supposed to require school districts to change their long-standing practice of spending more money per pupil on schools with the lowest poverty rates. The maintenance of effort and supplement, not supplant and don’t address underlying finance structures.

But the legislative statute and regulations that define comparability contain a major loophole that renders the guarantee meaningless. The loophole allows school districts, when comparing education services provided at Title I and non-Title I schools, to ignore differences in spending on teachers, which consitutes over half of all state and local education spending.

In the first draft of a No Child Left Behind reauthorization bill released last fall, the House Education and Labor Committee proposed closing the comparability loophole. Done correctly, it could be the most important change to NCLB for low-income children.

[slideshow] Within-District Spending Disparities, and Why They Exist

Within-district, between-school spending disparities aren’t frequently discussed, but they are widespread, particularly within diverse districts that house a socio-economic range of neighborhoods and students. Disparities result mainly from an unequal distribution of teachers and teacher salaries among schools—more experienced, better paid teachers gravitate towards the lowest-poverty schools, while the highest-poverty schools are left with the least experienced, lowest paid teachers (and thus the highest-poverty schools receive less money per-pupil).

This type of teacher movement is allowed, because of the structure of union contracts with school districts. Staffing provisions in collective bargaining agreements grant preference for seniority, meaning that the most experienced teachers get first choice where they want to transfer and teach. And the better teaching conditions at lowest-poverty schools attract the higher-credentialed, more experienced teachers.

The Teacher Salary Loophole, and How it Undermines Comparability

It sounds like the comparability requirement might force districts to remedy these teacher spending disparities. Unfortunately, the legislation contains one major loophole that throws any possibility of meaningful comparability out the window:

For the purpose of this subsection, in the determination of expenditures per pupil from State and local funds, or instructional salaries per pupil from State and local funds, staff salary differentials for years of employment shall not be included in such determinations.

This means the principle cause of within-district, school finance inequity—teacher salary differences—need not be remedied.

Currently, all school districts have to do to demonstrate comparability among schools is submit a written assurance to the state that they: (1) use a district-wide salary schedule, and (2) have policies "to ensure equivalence among schools in teachers, administrators, and other staff…and in the provision of curriculum materials and instructional supplies." (Oh, and they must "keep records to document that the salary schedule and policies were, in fact, implemented." But states do such a poor job monitoring comparability that it’s unlikely those records would ever be needed.)

Thus as long as the teachers are all paid on the same scale and distributed evenly in terms of numbers, not quality, it doesn’t matter that the lowest-poverty school has 20 highly-credentialed, experienced teachers and the highest-poverty school has 20 rookie teachers. In this regulatory world, Wilson High School in Northwest Washington, DC is comparable to Anacostia High School in Southeast Washington, DC. And thus, the comparability provision has become a cruel joke.

Giving Comparability Teeth

The most robust demonstration of comparability would involve a straight-up, no-gimmick state and local teacher salary expenditure comparisons between schools—with salary differentials for years of employment included. This is what the House has proposed, and where Congress should continue to head, in its NCLB reauthorization bill.

(Side note: One obstacle to using teacher salary spending per-pupil for comparisons is that many school districts do not track real teacher spending at each school, instead only monitoring teacher allocation numbers. These local budgeting practices, which mask teacher spending disparities, would have to change.)

There will be (and already has been) intense opposition to any comparability changes from teacher’s unions and school administrators, as such changes might require renegotiating teacher collective bargaining agreements, changing seniority and transfer provisions that enable the most experienced teachers to cluster in lowest-poverty schools, or adding pay incentives to attract high-quality teachers to highest-poverty schools.

But if the federal government wants to ensure that its investment is truly enhancing the education of disadvantaged children—not making up for disparities in teacher quality—strengthening comparability is a critical first step.

10 Questions on the Bush Education Budget

Ed Policy — Tue, 05 Feb 2008 00:00:00 -0500

Ed Money Watch has some questions for the Bush administration on its fiscal year 2009 budget request for education.

K-12 EDUCATION

1) The administration proposes increasing No Child Left Behind (NCLB) Title I grants to school districts by 2.9 percent, essentially an increase matching inflation. It also proposes redirecting a greater proportion of Title I funds to high schools. Does this mean that school districts will have to cut Title I funding for K-8 schools, since districts will effectively receive the same level of funding as in the previous year? How will this affect student achievement in grades 3 through 8?

[slideshow] 2) The administration’s budget proposes shifting $100 million from the NCLB’s Title II "Improving Teacher Quality State Grants" program to a "Teacher Incentive Fund" program that supports state and local performance-based compensation initiatives and incentives for teachers to serve in challenging schools. These activities already are allowed under the large and flexible Improving Teacher Quality State Grants program. Why, when the administration is generally trying to consolidate programs and get rid of duplicative ones, does the budget slice off funding for this smaller duplicative program?

3) The newly proposed "Pell Grant for Kids" program includes a provision that scholarship recipients would be required to take an assessment in each grade and subject as required under NCLB’s Title I program. Would there be any accountability for the private schools if the test results show that students are not achieving? What would the consequences be for failure to make adequate yearly progress? If there are only a few students taking the test at a given private school, how would schools provide the public with the information required under NCLB accountability standards?

4) The budget request proposes replacing the 21st Century Learning Community Learning Centers with a new 21st Century Learning Opportunities program, transferring funding to voucher-like scholarships for extended learning activities. The administration argues that the Learning Centers were not improving academic outcomes, and that a scholarship system would be more effective, because states can identify high-quality programs for parents. But states are currently required to ensure the quality of the after-school centers they choose to fund; why would they be any better at identifying high quality choices for parents? How would the new program differ from the Title I Supplemental Educational Services provision, under which states are struggling to evaluate the quality and academic outcomes of extended learning activities?

HIGHER EDUCATION: STUDENT LOANS

5) The Federal Family Education Loan (FFEL) program and the Direct Loan program show similar per loan costs for 2008 and 2009, with the FFEL program showing a slight cost advantage for the first time. However, page 364 of the Budget Appendix notes that costs are higher for the Direct Loan program, because it holds nearly 100 percent of student loans that have defaulted (under FFEL and Direct Loans) and have been rehabilitated through consolidation.

Can per loan program costs be accurately compared when high-default risk FFEL loans are dumped into the Direct Loan program? If OMB and the Department of Education corrected cost estimates for this bias, how would the costs change? Which program would be cheaper for taxpayers in costs were controlled for borrower differences?

6) Federal funds held by state guaranty agencies used to pay loan default claims under the Federal Family Education Loan (FFEL) program nearly doubled to $1.1 billion in 2007 from $579 million in 2006. Are the federal funds held by guarantee agencies in excess of what is needed to pay default claims, and if so, would the administration recommend recalling those funds?

7) The budget proposes a change in the eligibility rules for the new Loan Forgiveness for Public Service Employees program created under the College Cost Reduction and Access Act last year. Borrowers who pursue public service careers and begin loan repayment after October 1, 2007 are eligible to have the remaining balance of their loans forgiven after 10 years. The benefit is available to Direct Loan borrowers and Federal Family Education Loan (FFEL) borrowers who refinance into direct lending.

The budget request would limit eligibility to new borrowers who take out loans after October 1, 2009. If the proposal is enacted, how many borrowers now eligible for public service loan forgiveness will lose eligibility? And what types of shifts in the loan volume does the administration foresee between direct lending and the program that the administration cites as the need for the change in eligibility rules?

8) The loans for short-term training proposal would create a new and relatively small loan program, subsidizing $362 million in loans in 2009 to help dislocated and unemployed workers obtain training. Given the administration’s overarching goal of reducing smaller and duplicative education programs, why not use existing student loan programs for this goal instead of establishing a new program administered by two agencies (the Departments of Labor and Education)?

HIGHER EDUCATION: GRANTS

9) The budget includes a $652 million cancellation of the $960 million Congress has made available for the Academic Competitiveness and SMART Grant programs, citing insufficient program participation rates. Why are participation rates not high enough to use all available funding, and does the administration recommend any action to increase participation? Also, the programs expire after the 2010-11 academic year. Does the administration have a position on whether they should be extended?

HIGHER EDUCATION: TAX BENEFITS

10) The administration is proposing a new higher education tax credit worth up to $1,000 annually on contributions to 529 college savings plans, while maintaining other overlapping higher education tax benefits. Four years ago the administration wanted to "revise and simplify" rules regarding the three largest existing higher education tax credits. Why has the administration abandoned the goal of simplification, and what steps will be taken to ensure the 529 credit does not make the interaction between the higher education tax credits more confusing?

Bonus Question: Did Senator Pell's family consent to the use of his name for a private school voucher proposal? Were they even asked?

More Money, Lower Achievement in Durham, North Carolina

Lindsey Luebchow — Mon, 04 Feb 2008 14:00:00 -0500

Durham, North Carolina. It's a medium-sized, old tobacco and textile city best known for housing Duke University. Most national media coverage of Durham focuses on the ivory tower that is Duke, its highly-ranked undergraduate and graduate programs, and of course Duke's basketball team. Rarely does anyone outside North Carolina get an accurate (or any) picture of the city itself and its own educational issues.

In the shadow of an elite institution of higher education, Durham’s K-12 public education system is struggling and often failing to educate its students. Only six schools out of 45 made Adequate Yearly Progress (met No Child Left Behind achievement goals) last year. Some 19 of Durham’s 26 Title I elementary schools are in school improvement status, meaning they have failed to make Adequate Yearly Progress for at least two consecutive years. Only 56 percent of Durham students graduate from high school.

There are obviously a lot of factors contributing to Durham’s poor achievement levels and high drop-out rate. But let’s take a closer look at the money going into Durham’s schools and see how its funding compares to similar districts in North Carolina.

Durham is spending $8,269 per pupil, which ranks 29th out of 115 school districts in North Carolina. About $519 of that spending comes from the federal government in the form of a NCLB Title I grant and IDEA special education grant.

What’s happening in districts with a similar size and poverty rate? Using the Federal Education Budget Project’s Comparison Tool, available at Ed Budget Project.Org, you can compare Durham to other districts in North Carolina and other districts nationwide.

The most similar district to Durham in North Carolina—in terms of size and poverty rate—is Gaston County Schools, a district in the South-Central Piedmont region of North Carolina next door to Charlotte. Both have around 32,000 students, and 17-18 percent of those students live in poverty.

But Durham is spending $1,782 more per-pupil than Gaston County. And the money isn’t translating into higher achievement—Gaston County is doing better on North Carolina’s No Child Left Behind achievement test, the ABCs Test, with 82 percent of 4th graders deemed proficient in reading and 93 percent proficient in math, compared to 75 percent and 88 percent in Durham.

So what’s the story here? Well, it could be that Durham is experiencing a different type of poverty than Gaston County that makes teaching low-income students more difficult. Maybe Durham can’t attract high-quality teachers because of its location, run-down school facilities, or unattractive working conditions.

Or maybe this is an example of what President Bush likes to call the "soft bigotry of low expectations" for minority students: Durham’s schools are 72 percent black and Hispanic, while Gaston County’s schools are 28 percent.

Whatever the combination of factors causing Durham to perform more poorly than its peer school districts while also spending more money, it’s a question that should be raised and discussed by schools, parents, policymakers at the local and state levels.

There are conversations going on in Durham about teacher recruitment and retention, school choice, pre-kindergarten, and the achievement gap, among other issues. But action and results are another story.

Durham isn't the only community of concern. There are many places in the country where not enough of these conversations are taking place. Check out the funding going to your local school district, or any school district in the country, and take a look at their comparative performance by going to New America’s Federal Education Budget Project at Ed Budget Project.org.

School Finance Equity: National Trends

Lindsey Luebchow — Tue, 29 Jan 2008 00:00:00 -0500

Little known is that since the No Child Left Behind Act (NCLB) was passed, the federal government has prioritized "school finance equity" as a goal for states to achieve. In fiscal year 2008, 21 percent of NCLB Title I funds will be distributed based on an Education Finance Incentive Grant formula, a funding stream that has been increasing since NCLB first passed. But few people understand why certain states are deemed more "equitable" than others. You hear a lot of praise and criticism about equitable school funding, but little explanation of what it means or what produced it.

School finance equity typically measures how much per-pupil expenditures vary across districts within a given state. Greater equity means less variation. Sounds simple, but there are many different formulas used to calculate it, and their specifics can be quite complicated (remember statistics and weighted coefficients of variation?). The federal government has its own definition of school finance equity, which you can read more about here from www.EdBudgetProject.org.

Some states are more equitable than others for two basic reasons: (1) decisions made at the state level about how to distribute funding, and (2) the size and number of school districts within a state.

Ed Money Watch will discuss the first reason at length in the future, as we’ll be looking at how different states choose to distribute their funding to districts (for example, in ways that minimize per-pupil expenditure variation and sometimes even take into account the additional needs of students in poor districts).

But there’s also the more basic, easily explained reason for school finance equity differences across states (as seen on this interactive map): the size and number of school districts. If a state has a large number of small school districts, it tends to have more variation in per-pupil expenditure. A smaller number of large school districts translates into less variation and more equity.

This makes sense intuitively—if you aggregate funding in large school districts, and then distribute it among a large number of students in a uniform fashion, local funding disparities are minimized. Small school districts, on the other hand, magnify the influence of local property taxes and thus disparities in local property wealth. Moreover, funding decisions are less centralized, leading to wider variation in per-pupil expenditure levels.

This is one of the reasons why, when you look at national trends in the federal school finance equity factor on this map, the Northeast and the Midwest fare so poorly. They have lots of small school districts. Southern and Western states generally do better because they have fewer, large school districts. In the South and the West, states have an average of 200 districts, with approximately 5,650 students per district in the South and 4,350 students per district in the West. The Northeast averages 330 districts per state, and the Midwest averages almost 430, with significantly fewer students per district (2,670 and 2,055 respectively).

The South is the most equitable region, with finance inequity between districts averaging 10.5%, or $769 (see explanation here). Among Northeast states, average inter-district inequities are much starker than in any other region—14.9%, or $1,618. Of states that rank in the top half of the country in the federal school finance equity factor, only one is in the Northeast and only four are in the Midwest. The other 20 most equitable states are located in the South or West.

Here’s a quick comparison: Florida and Illinois have approximately the same number of students. But Illinois has 881 school districts, with an average of 2,381 students per district, while Florida has 67 school districts, with an average of 39,761 students per district. Florida is ranked 3rd in the county on the federal school finance equity factor, while Illinois is ranked dead last.

Of course there are other reasons while Florida is equitable and Illinois is not—but at a basic level, the size and number of school districts definitely contributes. This isn’t necessarily to say that larger school districts are better. Local control of schools and funding is important in that taxpayers are more involved and stay more engaged in education (and thus are often more apt to agree to higher spending). But it’s a fact that the more localized the monetary decision-making, the wider the variation in school funding.

A similar analysis with more detail is available below this interactive map from www.EdBudgetProject.org. There are also additional maps and analyses that compare spending and achievement trends nationwide.