Reinventing School Finance: Falling Forward

Abstract

States and school districts are facing unprecedented financial pressure due to the continued poor performance of the United States's economy. Dramatic shortfalls in funding due to reduced tax collections were held off for 2 years thanks to federal stimulus funds, but with these revenues already consumed and little likelihood of more in the near future, school districts are faced with some of the largest funding shortfalls they have ever experienced. This article offers a number of suggestions for ways schools and school districts can reduce spending while maintaining a strong emphasis on improved student performance. These ideas include focusing more resources on core subjects, making trade-offs that include the potential of larger classes in exchange for professional development in the form of instructional coaches, and establishing research-based priorities for the use of existing resources.

Notes

^aEstimated.

If the federal government engaged in reform of the individual or corporate income tax structures by eliminating deductions and lowering the rates but nevertheless producing more revenues, states conforming their own corporate and income tax structures to the federal changes could also produce more revenues, but this possibility—which some might call remote—would address medium but not short-term revenue shortages, so it is not a viable option for the next couple of years.