Comparability

In California, Governor Arnold Schwarzenegger's Committee on Education Excellence released its long-overdue final report last week with recommendations for reforming the state's K-12 education system in four areas: governance, finance, teacher recruitment and retention, and administrator preparation and retention. The finance section, titled "Ensure Fair Funding that Rewards Results," offers a number of good, detailed ideas for making state funding more flexible and student-centered, and better tied to incentives to improve learning.

One specific proposal in the report caught Ed Money Watch's eye: Recommendation 2.1.8—make school budgets more understandable. We believe that changing school district budgeting practices is a key first step in school finance reform. Education advocacy groups in California have been talking about this for a long time, and it's encouraging to see a state committee acknowledge the need for change. We hope that other states will take note.

Specifically, school districts need to report how funding is allocated—using the actual cost of resources—across all of their schools. Currently, districts do not report school-level funding figures, instead using district averages to calculate budgets. As the California report recommends, districts should "clearly delineat[e] the total resources (i.e., the financial value of the personnel, supplies, and services) that reach each school."

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: