Introduction

State leaders can and should do more to more adequately and fairly fund public schools. Too few state funding systems are investing enough funding to cover actual education costs and ensure that districts can provide enriching learning environments for all students. Additionally, while many states provide additional funding to support the needs of students that have been historically underserved, most states fall short of providing additional funding at the levels needed to effectively boost student outcomes and close opportunity gaps.

This series of briefs, EdTrust’s Policy Positions on School Funding, outlines five core policy positions that shape our beliefs about what state leaders should do to more adequately and fairly fund schools to meet the diverse needs of all students, fostering environments where every student can thrive.

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Fund Schools Adequately to Ensure Student Success

Consistently and strategically investing in public education pays off. National research shows that additional state investment in public education can reduce funding inequities between high-poverty and wealthier districts and lead to better academic outcomes for students such as higher test scores and more completed years of schooling. These studies also show that increased investments can lead to students earning higher incomes as adults. Other studies show that increased state investment can have even greater positive impacts on Black students and students living in poverty — populations that states often fail to provide equal and equitable access to high-quality educational resources.

Despite an increase in public education spending over the last 40 years, state and local revenue — the funds that makes up the majority of K-12 funding — remain inadequate and inequitable. While this brief focuses on how states can more adequately fund public education, funding systems should ideally promote both adequacy and equity. To do so, states must determine how they define adequacy. They can do so through:

• Expanding how they define adequacy through best practices, research, and data
• Meaningfully engaging stakeholders
• Regularly reviewing and assessing the adequacy of funding formulas

Advocates should know that regardless of a state’s approach to adequacy, achieving adequate school funding does not occur overnight and requires persistent and strategic pressure from a diverse coalition of advocates

In this brief, EdTrust analyzed and rated the four common adequacy approaches according to a set of criteria that aligns with the organization’s priorities. While no singular approach met our criteria, many states utilize combined methods that meet the adequacy study charges put forth by states. Read our brief to learn more about how states can fund schools adequately to ensure student success.

Read our brief to learn more

Fund Schools Equitably to Meet Students’ Needs

State school funding systems should provide equitable levels of funding to address students’ individual needs including the needs of students who are underserved in public education, particularly students of color, students from low-income backgrounds, multilingual learners, students with disabilities, and students from rural communities.

Our brief lays out four school funding principles that can help ensure state funding formulas provide more funding to districts for students facing barriers to learning. When implemented properly, districts can meaningfully invest in resources that help students thrive in the classroom and after graduation. Our four school funding principles are:

• Students who need more should get more: Districts receive generous, additional funding for students with unique needs
• Students with greater needs should get even more: Formulas provide additional funding that is tiered, or on a sliding scale, to account for the significance of need within a category, such as students with disabilities
• Students should be funded for each need: A student with multiple needs, such as a student who is an English learner and living in poverty, is eligible to receive additional funding for each need
• High poverty at the district level should be accounted for: Formulas provide additional funding to address the unique challenges faced by districts with high concentrations of students living in poverty

Many states have made progress toward equitably funding student needs. Despite this, governors, legislators, and state education agencies still have more work to do to ensure that funding systems and policies provide significantly more funding and resources to students who have been historically and intentionally excluded and underserved in the public education system. Read our brief to learn about the key policy changes that state leaders can adopt to make school funding fairer and more responsive to students’ needs.

Read our brief to learn more

Make Local School Funding Fairer

State leaders can and should do more to take local property wealth into account and reduce local revenue inequities between districts. Local funds generated by property taxes remain within the communities that raise them leading to school communities with higher property values being better funded and resourced. This separate and unequal distribution of wealth is due to the legacy of racist and classist policies that have systemically denied Native, Black, and Latino communities the opportunities to build wealth. These communities must often tax themselves heavily just to meet the minimum requires local revenue contributions and they often cannot raise any more money beyond that. This leaves their schools struggling to attract and pay for more experienced and effective teachers, maintain facilities, and causes their students to miss out on the support and enrichment opportunities that wealthier students enjoy. These wealth disparities deepen the gap in educational opportunities for our nation’s students.

This separate and unequal distribution of wealth is due to the legacy of racist and classist policies that have systemically denied Native, Black, and Latino communities the opportunities to build wealth.

Many states have implemented policies to prevent or counteract local funding inequities; however, more work needs to be done in these states and in others across the country to remedy these opportunities gaps.

EdTrust recommends that states must:

• Adjust state aid based on local wealth and require localities to contribute their fair share and limit how much revenue districts raise from local taxes and fees
• Establish consistent and fair property assessment laws
• Broaden districts’ tax base by redrawing district boundaries or consolidating districts

Equitable local revenue policies are fundamental to addressing disparities in educational opportunities. Taking these steps are essential to ensuring all students have what they need to thrive in school and beyond; however, equitable local revenue policies are just one part of the picture to achieving full funding equity. Read the entire brief to learn more about what state leaders can do to fund schools more fairly.

Read our brief to learn more

Fund Schools Transparently

To truly meet the needs of all students, state leaders must clearly explain and share information about fund allocation and distribution. Currently, most state funding formulas are complex, rarely understood by stakeholders (advocates, families, educators), and are often buried in dense legislative or agency documents that are posted in obscure places online. The inaccessibility of this information directly undermines the public’s ability to hold state leaders accountable, identify the strengths and weaknesses of a state’s funding formula, and determine the extent to which dollars are reaching students.

State leaders can improve the transparency and accountability of the funding systems by doing the following:

• Clearly explain how their state’s funding formula is designed to work
• Annually collect and publish transparent data on how much funding districts and schools receive
• Ensure that districts use funding to improve student experiences and outcomes

Accountability for how funds are used is important, but that accountability can lead to prescriptive uses of funds that prevent districts from meeting the specific needs of their schools and students. States should strike a balance between including guardrails in their systems to make sure that funds are used well and on students who need the most support, while also providing enough flexibility to allow districts to respond to their local needs and context.

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Keep Public Funds in Public Schools

Adequately and equitably resourced public schools are foundational to a thriving, democratic society. Yet, as public school funding remains inadequate and inequitable in most states, an increasing number of states are adopting private school choice policies such as vouchers, education savings accounts, and scholarship tax credits, that divert public funds to private schools. Private school choice programs undermine equity because they:

• Drain funds from public schools
• Deepen wealth gaps by primarily benefiting students from affluent communities
• Typically cost more than initial estimates and budget appropriations
• Reduce state revenues

Diverting public funds to finance vouchers is harmful and many students and families do not support these policies. In November 2024, voucher-related policies failed in three states, with voters in Kentucky and Colorado rejecting voucher-related ballot measures and Nebraskans voting to repeal a voucher law. Policymakers need to listen to their constituents and take responsibility for funding public schools better and ensure that every student’s needs can be met in a public school environment. Read our brief to learn more about how private school choice programs are detrimental to our public schools.

Read our brief to learn more

Southerners for Fair School Funding Initiative

In addition to these briefs, we encourage advocates, particularly those in the South, to check out Southerners for Fair School Funding powered by EdTrust-Tennessee. This initiative supports organizations and advocates across the South who are building a movement to fairly fund every school. Click the button below to learn how fair funding is in your state and to join the movement.

Fund Southern Schools