The Myth of Underfunded U.S. Schools

The American public once again views “inadequate funding” as the top problem facing public schools, according to the annual PDK Poll.

But the public will soon know exactly how much every public school actually spends, thanks to new federal reporting requirements. This leap forward in school finance transparency may forever change how Americans think about public education.

The PDK poll has provided a barometer of public perceptions of public schooling since 1969. The latest survey confirms the public still believes schools have too little money. This view is shared across socioeconomic communities: “[A]among the best-off Americans, those in $100,000-plus households, 54% see their schools as underfunded,” PDK reports. “But that rises to 64% of those with incomes less than $50,000.”

The poll findings raise a question: what do most Americans know about what we are spending on our public schools?

Average per-student spending in American public schools is about $13,000, according to the National Center for Education Statistics. But it’s evident many Americans falsely believe we spend much less.

A 2018 survey by EdChoice, a non-profit that advocates for expanded parental choice in education, found that many Americans grossly underestimate public school spending. Fifty-five percent of survey respondents believed that “the U.S. spends $5,000 or less per student,” while 78 percent estimated per-student funding was $10,000 or less.

Hopefully, Americans’ understanding of public schools’ spending is about to change.

All states are required to report school-specific spending data by 2020 under the bipartisan Every Student Succeeds Act law. This transparency will help parents and the public see firsthand what taxpayers are spending on their public schools, as well as how those dollars are being spent.

Some states are already reporting school-by-school spending. For example, New Jersey released its “Taxpayer’s Guide to Education Spending 2019” last week. The report found that the Garden State’s average cost per-pupil was nearly $22,000 during the 2017–2018 school year. In more than a dozen districts, schools spent more than $30,000 per student.

National school-by-school expenditure reporting could forever change how we think about public education in several important ways.

For starters, the public will be able to judge equity in how funds are distributed to different schools across states, including resource gaps between rich and poor children’s schools, which has been a national concern for decades. Federal policy has aimed to reduce inequity in the resources available in high-poverty schools since the 1960s. National data from the U.S. Department of Education shows that per-student revenues in an average high-poverty school district are only about $500 less than in low-poverty school districts. High-poverty schools actually have higher per-pupil revenues than low-poverty districts in a majority of the states. But gaps in school funding remain in many school systems. A school-by-school spending analysis will shed new light on important questions about equity in current school funding.

Second, parents and teachers will be able to see how school districts are using tax dollars, including how much is spent on classroom expenses and teacher salaries versus administration and other non-classroom costs. This new information will introduce important context into public debates about school funding, potentially focusing more attention on how funds are being spent. Comparisons between schools may also identify links between spending efficiencies and school quality, or at least draw lessons about how schools can stretch tax dollars further to benefit children

Third, parents will now have more information to assess their school’s value, and to think about how school funding affects their children’s education and future. The data may reveal that some schools truly need additional funding and resources. But many parents may begin to question whether their child’s share of public school’s funding could be better applied elsewhere.

For example, disadvantaged parents may ask whether they’d be better off having direct control of their child’s funding through an education savings account, or to at least be able to choose a different school. Parents may also spot eye-opening differences between schools’ spending levels, and question whether they could get better value if they transferred. For example, the University of Arkansas researchers reviewed school funding data in fifteen urban areas and found that public charter schools receive $5,800 less per-pupil than traditional public schools, which is a 27 percent funding gap.

All of these questions surrounding the amount of funding and how it’s applied are important to ask.

For disadvantaged children who rely primarily on public schooling to receive an education, taxpayers’ spending on education is the biggest investment made in their future. It’s well past time we start looking carefully at exactly what we are spending and whether it’s yielding the best possible return on investment.