Student-Based Budgeting: The Case for Transparency of District Funds Allocation

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Student-Based Budgeting: The Case for Transparency of District Funds Allocation

 

“The focus needs to be getting to the point of tracking spending at the classroom level so we know how much a school spends on, for instance, Algebra 1 versus AP calculus. This is how we could start to use data to inform where the funding needs to be.”

Aaron Smith, Reason Foundation Education Policy Analyst

A shift is occurring in school districts across the United States, a shift from top down, centralized budgeting to student-based budgeting, also referred to as weighted student funding.  According to the American Legislative Exchange Council, weighted student funding is defined as “student funding from state sources. It includes additional funds, “weights,” based on percentages of foundation funding revenue to offset the higher education costs associated with certain student and school demographics.” Weighted student funding or student-based budgeting can also be associated with the option of school choice, a hot topic in the news today, as public funds follow the child to the school that they choose to attend.

We caught up with Aaron Smith, an education policy analyst from the D.C. based think tank the Reason Foundation, that promotes both student-based budgeting and school choice, to discuss school finance and student-based budgeting.

What we learned is that we still have a long way to go for equality and transparency with education funding, but some states and districts are making progress.  Smith explains, “95% of what you hear about funding is how districts are funded, but what you rarely hear about is what actually happens to the funds when they get to the district level. People assume school and district funding are one and the same but there is a lot of research to show once funding gets to the district level, those funds are often distributed in a manner that is not only opaque, but also highly inequitable.”

For example, in many instances, districts allocate resources to schools based on average teachers salaries, but schools in low income communities often get lesser experienced, lower paid teachers.  As a result, these communities are getting shortchanged with less funds to spend on things that would otherwise benefit their students.  Smith tells us that some districts are good at transparency and laying out per pupil spending in a more user-friendly manner, citing Houston, Denver and Boston as examples.

Today, thirty plus school districts are using student-based budgeting, which delivers funds in a more transparent and equitable manner, although each model is unique to adapt to local factors.  Certain districts are doing better with allocation and tracking than others but it is clear that equality in distribution and transparency still needs improvement.  Smith explains, “the focus needs to be getting to the point of tracking spending at the classroom level so we know how much a school spends on, for instance, Algebra 1 versus AP calculus. This is how we could start to use data to inform where the funding needs to be.”

Shifting to what we are doing here at ClassWallet to help improve education funds tracking, Smith remarks, “I think it is very exciting what ClassWallet is doing.  We need more people engaged with not only how the funding goes down to their school level, but ultimately toward where we want it to go, which is the classroom and eventually empowering teachers to be able to have autonomy over some of the funds.”

Smith concludes our discussion with a look at what school districts need to focus on for transparency to be more widespread in the future. “A big part of that, of course, is technology solutions, like Classwallet, that track dollars and empower those closest to the student to make real-time decisions.  For me, this is very exciting.”

What type of transparency does your school district have in how it allocates budgets at the school, classroom and student level?

Let us know in the comments below.

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