Improving Title I funding equity across states, districts, and schools.

ABSTRACT: For decades, the federal role in school finance has been guided by the simple principle that greater aid should flow to areas with higher poverty. However, this principle is largely violated in practice. Through a novel empirical analysis of federal allocations across states, districts, and schools, this Article demonstrates serious inequities in the allocation of funds under Title I of the Elementary and Secondary Education Act, the single largest stream of federal aid for disadvantaged children in public schools. The most severe inequity occurs in the allocation of Title I funds across states. By allocating aid to states in proportion to state per-pupil expenditures, Title I reinforces vast spending inequalities between states to the detriment of poor children in high-poverty jurisdictions. Across districts, aid per poor child generally increases with poverty concentration, but there are significant inequities among districts with comparable poverty based on their sizes of enrollment. In particular, small or mid-sized districts that serve half or more of all poor children in areas of high poverty receive less aid than larger districts with comparable poverty. Moreover, although Title I disproportionately benefits schools with higher poverty, equitable allocations across schools are nested within inequitable allocations across districts and across states. This Article proposes several reforms to Title I that policymakers should adopt as part of the reauthorization of the No Child Left Behind Act.

 
     INTRODUCTION 
  I. THE TITLE I FORMULAS 
 II. EQUITY ACROSS STATES 
III. EQUITY ACROSS DISTRICTS 
 IV. EQUITY ACROSS SCHOOLS 
  V. POLICY IMPLICATIONS 

INTRODUCTION

As Congress prepares to reauthorize the No Child Left Behind Act ("NCLB"), (1) policymakers and advocates have urged significant reforms of the federal role in education, including national standards, school vouchers, and growth models for measuring progress. (2) Although these ambitious proposals will garner headlines, it is worth recalling that the Elementary and Secondary Education Act of 1965, the original precursor to NCLB, had humbler origins not as an instrument for systemic education reform, but as a simple vehicle for directing federal aid to poor children living in concentrated poverty. (3) For four decades, this goal has been a prominent refrain in discussions of the federal role in school finance. However, measured against this goal, the federal role leaves much to be desired and, in the context of NCLB reauthorization, much for policymakers to improve.

This Article examines whether federal aid to public schools promotes equity, defined here to mean that greater resources flow to places with higher poverty. (4) This definition of equity goes beyond the notion that poor children should be given more resources than non-poor children. It requires that resources flow disproportionately to poor children in areas with more concentrated poverty. This principle is rooted in the well-documented finding that poor children in concentrated poverty face a "double disadvantage" arising from their own poverty and the poverty of their peers and local neighborhood. (5) Indeed, "[o]ne of the most consistent findings in research on education has been the powerful relationship between concentrated poverty and virtually every measure of school-level academic results." (6) Current federal policy recognizes that "the poverty of a child's family is much more likely to be associated with educational disadvantage if the family lives in an area with large concentrations of poor families" and aims to target resources to areas "where needs are greatest." (7) It is debatable how much resources should increase with every increment of poverty concentration, but it is enough for the present analysis to define the equity principle in general terms.

In evaluating federal policy against this principle, I will focus on Title I of the Elementary and Secondary Education Act (now NCLB). (8) Although the federal role in K-12 education encompasses more than Title I, (9) this focus is important for several reasons. Title I has long been the single largest federal investment in public schools, totaling $12.7 billion, or one-third of federal K-12 spending, in 2006. (10) Title I also dictates federal aid allocations under several other education programs totaling $1.6 billion in 2006. (11) While these amounts are small within a combined local, state, and federal education budget of $400 billion, Tide I provided 5% to 10% of total revenue in more than 1,200 school districts in 2003-2004. (12) Moreover, Title I will serve for the foreseeable future as the policy vehicle for expanding) federal aid to public schools. Congress has authorized almost twice the current level of spending for Title I, leaving ample room for appropriations to grow. (13) Finally, as a component of NCLB, Tide I is the principal federal program with the purpose of driving systemic education reform and narrowing achievement gaps by race and income. The allocation of Title I aid should bear a close relation to these policy goals.

This Article proceeds in five parts. Part I gives an overview of the four statutory formulas through which Tide I money flows from the federal government to states, then to school districts, and then to schools. After presenting this background, the heart of the Article provides a novel analysis of Title I funding equity at each level: across states (Part II), across districts (Part III), and across schools (Part IV). This multi-tiered inquiry reveals the complex ways in which equitable allocations are nested within inequitable allocations, and vice versa.