Giving Compass' Take:

• Victoria Lee and Kristin Blagg explains that equal, across the board cuts in school funding from states would disproportionately impact vulnerable populations.  

• What role can funders play in ensuring that marginalized communities are supported in education throughout and beyond the pandemic? 

• Read about COVID-19's impact on the fight for racial justice in schools

State budget shortfalls resulting from the pandemic mean education funding is likely to suffer. To mitigate the harm of budget cuts, state legislators must think strategically. How cuts are made can have dramatically different impacts across different schools and students, and implementing equal-percentage cuts across districts is likely to further inequity.

Educational spending improves students’ educational attainment, increases wages, and reduces incidents of adult poverty. Further, research shows cutting education funding lowers test scores and rates of college going. In most states, state funding provides the bulk of the money spent on K–12 education, with federal dollars accounting for around 10 percent of total funding and local property taxes making up the rest.

During the pandemic, many advocates have called upon the federal government to allocate additional funds to help fill the gaps in state funding, as they did with the 2009 American Recovery and Reinvestment Act. But given current uncertainty about how much, if any, additional aid will come from the federal government, it is critical to examine the equity impacts of different types of state funding cuts.

We find percentage cuts have regressive effects on total state and local funding in almost all states and even move several states from allocating more money to low-income students to becoming regressive. This is likely because districts with higher shares of low-income students tend to get higher levels of state aid, so a percentage cut hits them harder. Percentage cuts do not have a consistent effect on the distribution of funding to white students relative to students of color. Similarly, there are contextually specific effects on rural and urban students.

Per student funding cuts have virtually no effect on our measure of funding progressivity. Targeted cuts—cutting a higher percentage from districts serving fewer students in poverty—made funding more progressive in every state and even caused some states to move from regressive to progressive funding (although, as with all cuts, every district would see less this year than they did previously).

Any reduction in K–12 funding harms students’ academic and labor market outcomes. If policymakers must implement cuts, the data suggest that to protect the most vulnerable populations, they should not just cut across the board.

Read the full article about K-12 state funding by Victoria Lee and Kristin Blagg at Urban Institute.