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How States Can Put Students at the Center of Their School Funding Formulas

Marguerite Roza

Published February 27, 2020 on The Hunt Institute's Making Sense of NC School Funding blog series

Overhauling a state’s education funding formula is extremely difficult. Typically, two or three decades can go by before the political forces align to reshape a state’s formula. A smart strategy is to design the formula around students, the one element of schooling that we know will still exist decades later.

With a growing number of states moving toward student-based allocations (SBA), the Edunomics Lab at Georgetown University has analyzed 29 states to date on what share of dollars is doled out on the basis of students. In fiscal year 2017, North Carolina allotted 21 percent of its state and local monies on the basis of students. Many of the remaining dollars were doled out through the state’s staffing formula and earmarks for specific programs.

Moving more funds to a student-based allocation model sets a state on a path toward greater equity, transparency, flexibility, and productivity. And aligning money with students gives state leaders a better shot at creating a finance formula that can weather the inevitable changes to schooling in the years ahead.

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2020-04-14T00:03:54+00:00