Establishing Priorities for Education Finance Under Fiscal Uncertainty: Recommendations for Washington State Policymakers

• In Event: Communities-of-Color-Based Research for Racially Just Transformation in a State's Public Education System

Abstract

Purpose
This study explores the extent to which Washington’s public education finance system provides equitable resource levels for students who identify as a person of color and students affected by poverty. A second objective is to demonstrate how state legislators can prioritize equity when altering their state’s K-12 finance system.

Theoretical Perspectives
We draw on theories of vertical equity, which suggest that K-12 state finance models should be “progressive,” allocating greater funding levels to higher-poverty school districts to address educational debt, or historical and longstanding disparities in educational opportunities for communities of color and families and neighborhoods affected by poverty (Ladson-Billings, 2006). We define finance equity based on the extent to which state funding is allocated progressively along two factors: student race/ethnicity and family income level. A state school finance system demonstrates racial/ethnic finance equity by providing equal or greater funding for school districts enrolling predominantly students of color, compared to districts with similar cost factors that enroll predominantly white student populations. We define income-based school finance equity as providing relatively greater funding levels to school districts serving higher shares of students affected by poverty.

Methods and Data Sources
We combine finance data from the Washington Office of Superintendent for Public Instruction with student demographic and neighborhood data from the U.S. Department of Education and U.S. Census. We analyze funding rates across school districts serving higher and lower proportions of students who identify as Black, Indigenous, Latinx, Native Hawaiian, Pacific Islander, Asian, or with more than one racial/ethnic category, and other minoritized students of color, as well as students affected by poverty. To draw comparisons among similar districts, we use a regression-based approach to measure school finance equity (Baker et al., 2018) and test whether results differ when using weighted average approaches (Chingos & Blagg, 2017). We first assess equity in total revenues and then disaggregate total funding into all 22 state categorical funding accounts, to demonstrate which funding streams disproportionately benefit predominately White or lower-poverty school districts.

Findings
We find recent K-12 finance reforms have increased total funding, but increases have primarily benefited predominately White or lower-poverty school districts. Analyses show that, like most states, local tax revenues in Washington contribute to income-based funding disparities. The state’s general fund allocation is not progressive enough to make up for these disparities. Moreover, several state funding accounts, for example, those in the state’s Capital Projects Fund, disproportionately benefited lower-poverty districts. This finding offers a call for state legislators to analyze finance patterns and prioritize equity in the design and implementation of finance reforms.

Significance
The study makes clear that significant inequities exist within Washington’s school finance system. More broadly our analyses are aimed at demonstrating how state legislators should study their own K-12 finance systems with an eye towards racial equity. Without this explicit focus, reforms may increase total funding, but do so in ways that disproportionately benefit groups already placed at an advantage.

Authors

• David S. Knight, University of Washington

• Margaret L. Plecki, University of Washington