Will New Funding Formula Move Schools Toward Education Equity?

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Nobody told the students to remove their hoodies, or stash their snacks.

Instead, a brief dose of hip-hop eased 10th-graders into their seats at Oakland High. Teacher Earnest Jenkins III, a towering man in a baseball cap, turned off the music. And he asked his class to reflect on a vocabulary word — mendicant, or beggar — and a quote: “Use missteps as steppingstones to deeper understanding and greater achievement.”

“You’ve got to do it yourself,” a student offered, “because it’s got to be genuine.” Jenkins smiled. “Way to sum that up,” he said.

Next, Jenkins guided students in writing questions about college admissions — questions for an upcoming guest, a black University of California at Berkeley vice chancellor who had also attended Cal. The campus enrolled about 5,500 freshmen in the fall of 2015, only 157 of them black.

“Think about what she may have thought about when she was in there,” said Jenkins, who is 35 and also black. “Maybe she was the only African-American in a classroom. Maybe the only one in the dorm room. Maybe the only one on that floor."


With that, he hit a key on a computer and treated the all-male, all-black class to a soundtrack of Bob Marley singing: “Get up, stand up. Stand up for your rights.”

Tenth grade Manhood Development class students at Oakland High absorb a discussion about college admissions.
Tenth-grade Manhood Development class students at Oakland High absorb a discussion about college admissions. (Eleanor Bell Fox/Center for Public Integrity)

Unorthodox? Perhaps. Jenkins’ reading, writing and reggae style clearly suits Oakland, a city that embraces its multiculturalism with pride. But the popular Manhood Development class that Jenkins teaches is more than a cool elective. It exemplifies the range of experimentation that’s becoming possible as a massive new school-financing formula takes root in California.

The new initiative suffers from a numbing moniker — the Local Control Funding Formula — but it represents nothing short of a revolution in how education is financed for more than 6.2 million students in the country’s biggest state.

As in many states, California’s school districts are funded with a mix of local property taxes and state money. This has tended to mean that spending on kids from affluent communities has been higher — a dilemma that’s led to unequal-funding lawsuits nationwide, starting with a landmark 1971 California case, Serrano v. Priest, and continuing even now in Connecticut, where the latest battle is raging. Despite reforms to create more equity in the wake of that 1971 suit, California’s convoluted distribution system continued to shortchange some of the state’s poorest kids. And strict funding rules foiled educators' attempts to try local approaches tailored to their specific school population.

School Funding: Striving for Equity in an Uneven Landscape

A new funding formula is sending California school districts extra state money to support low-income students and those who are disadvantaged for other reasons. In 2015, more than half the state’s districts reported that a majority of their students were low-income.

Below, a comparison reveals that the most affluent districts benefit from local tax revenue generous enough to cover relatively high per-pupil spending levels. These districts can also receive limited state and federal aid. For poorer districts dependent on the state, the new formula won’t close all spending gaps, but per-student spending in some poorer districts has risen dramatically in just the first two years of the new formula.

You can compare spending and other data for any of about 1,000 districts in California using our interactive below. High per-pupil spending in isolated and small poor districts often is due to special support from the state needed to function.


But over the past four years, circumstances in the Golden State have come together to change the game — radically. In 2012, voters approved Proposition 30, a temporary state sales tax and income tax hike on the wealthy aimed at filling in deep recession-era cuts to state school funding. The measure has raised about $8 billion a year. A white-hot, tech-driven economic recovery has raised many billions more in revenue for education. And although tax collections have dipped recently, the state’s basic budget for K-12 schools and two-year community colleges has rocketed from $47.3 billion in 2011 to a projected $71.4 billion this year.

The bid to fundamentally change how education funds were distributed met skepticism at first because of its aggressive “equity” push. But eventually it found bipartisan support in California's ethnically diverse, mostly Democratic Legislature. Lawmakers approved the new formula in 2013, and an eight-year phase-in plan began that fall.

The new system affords far greater local control and guarantees that districts with substantial populations of disadvantaged kids receive more state money — lots more.

This is how it works: All districts get higher per-pupil basic grants that vary by grade level. On top of that, districts also receive 20 percent more in “supplemental” per-pupil dollars based on the number of students identified as disadvantaged. If more than 55 percent of a district’s students are disadvantaged, the district also receives “concentration” funding — tied to the percentage of disadvantaged kids above the 55 percent threshold. Concentration funding is equal to a hefty 50 percent of basic per-student base grants.

The bottom-line increases can be stunning. In 2020, for example, when the formula is expected to be fully phased in, districts could receive a projected basic rate of about $9,115 for every high school student. But a supplemental grant would bump that up to $10,978. A concentration grant would bump it up to more than $14,128 for every disadvantaged high school student above the 55 percent threshold.

Disadvantaged students are those who qualify for a free or reduced school lunch because their families are low-income (about half the state’s students are low-income, as students nationally are), or who are English-as-a-second-language learners or high-risk foster kids. Kids in more than one target group are only counted once.

The statute creating the LCFF requires that supplemental and concentration money be invested in ways that “increase or improve” education for these disadvantaged students.

As the LCFF unfolds, complaints are surfacing about dubious expenditures — on school policing or across-the-board staff pay raises that state officials warn should be “targeted” to benefit disadvantaged kids. Not enough time has passed to conduct comprehensive evaluations. Critics are also assailing confusing “local control and accountability plans,” or LCAPs, that districts must create using a state template. The state isn’t collecting data on spending of earmarked money either.

Still, if students start showing academic gains, California’s experiment could provide a blueprint as other states struggle to close their own gaps between affluent and disadvantaged students. If achievement remains stagnant, though, that will no doubt threaten the formula’s future — and embolden those who argue that additional spending has little to do with educational quality.

In the meantime, some educators are seizing the moment — and the extra money —  to institute homegrown experiments aimed at transforming school culture in some of the toughest neighborhoods of Los Angeles and Oakland.

Read the full story via The Center for Public Integrity