K-12 Funding Toolkit: A Strategic Guide for States

Definition: State aid is allocated using a formula that is simple, logical, clearly articulated and informed by students, families, teachers and school leaders.

In a transparent funding formula:

Students, families, teachers and school leaders have a voice in designing how aid is distributed by the state to schools. The formula is clear and understandable. Funding allocations are driven by instructional services that are delivered by teachers and staff to students. The state makes resources available to understand how much aid districts are going to receive and why. There are publicly available tools to see how districts are spending dollars and student outcomes.

Policy Tools: 

• Community input process. 
• Centralized funding formula. 
• State website and reporting. 

Definition: Funding is allocated based on the learning needs of students with a focus on improving outcomes.

In a student-centered funding formula: 

Funding is allocated based on the learning needs of the individual students in the district. District leaders have the flexibility to use state resources to meet those needs based on the local context. The focus is on improving student outcomes and the funding system encourages student growth.

Policy Tools: 

• Student-based funding. 
• Local spending flexibility. 
• Accountability for outcomes.

Definition: Schools are provided sufficient resources to provide a high-quality education for all students and meet state achievement goals for student learning.

In an adequate funding formula: 

Schools have ample resources to sufficiently pay staff and provide services for students. Students can choose from a variety of courses, including advanced placement, dual enrollment, career and technical, work-based learning and extracurricular activities. Schools have sufficient staff so that students have manageable class sizes and access to learning specialists and mental health professionals. Everyone in the school building has access to safe learning and working conditions.

Policy Tools: 

• Research informed base amount. 
• Strengthen teacher salaries. 
• Develop student pathways (career and technical education, work-based learning, dual enrollment, etc.). 

Definition: Resources are prioritized to schools where students have the most complex learning needs and to districts where local resources are most limited.

In a fair funding formula: 

The state directs resources to where the dollars can have the greatest impact for improving student learning. The state in cooperation with districts accurately identifies the learning needs of the students and allocates aid based on that information. Local districts are not expected to contribute more than their local tax base can support and wealthier communities take on a larger share of supporting their local schools.

Policy Tools: 

• Weighted funding. 
• Funding for high-cost services.
• Wealth equalization.

Definition: Schools have a dependable level of state resources that allows district leaders to plan multiple years in advance and invest in services with confidence going forward.

In a sustainable funding formula:

In a sustainable funding formula, the state funding provided to districts is stable and does not vary based on fluctuating economic conditions. States have a reserve fund and dedicated revenue to ensure state aid is sufficient and allocated in a dependable manner. Teachers and staff can focus on student learning rather than worrying about job security. Changes or updates to funding are clearly communicated and phased in appropriately.

Policy Tools: 

• Inflationary adjustments. 
• Stabilization funds. 
• Dedicated revenue for K-12.