Credit: Alison Yin / EdSource
Top Takeaways
- The Local Control Funding Formula must be more responsive to enrollment trends to ensure funds serve the high-needs students for whom they are targeted, rather than filling gaps in the district budget.
- Policymakers must create incentives for districts to improve coordination and merging of services for students with multiple needs.
- In making adjustments to the formula, policymakers must avoid introducing too many new, disparate factors that can further burden school systems.
California has an opportunity to ensure that its school funding formula fully delivers on its goals to improve student outcomes, especially for those who need the most support. The key to success will be accounting for shifts in enrollment and creating incentives for districts to blend student programs.
The 2013 Local Control Funding Formula, or LCFF, represented a dramatic shift from a complicated morass of centralized funding requirements that often resulted in large variations in per-pupil funds delivered in and across districts.
Under LCFF, higher overall student outcomes have resulted, thanks to localized decision-making and additional funding to ensure that high-needs students also have the opportunity to succeed in schools. However, progress to close achievement gaps — a central intention of the funding formula — remains slow.
Last year, the California State Assembly held a series of LCFF panels with researchers and educators from across the state. Though divergent views were expressed, multiple experts recommended improving the distribution of supplemental grant funds to the highest-needs students and factoring in geographic cost differences — points underscored by WestEd’s evidence-based review of the funding system.
However, two significant dynamics, which we have frequently seen, received little airtime during the hearing. They may hold clues for further optimizing the use of taxpayer dollars.
First, funding formula updates must meaningfully account for future enrollment declines that could cause changes in the proportions of high-needs students to be served as well as the mix of funding available to school systems.
California’s public schools have lost a substantial number of students, and forecasts project further declines ranging from half a million to nearly 1 million students by 2032-33.
Because many students leaving California public schools — often due to the high cost of living — are English learners, economically disadvantaged and white students, the total and mix of available revenues for school systems is changing, and changing differently by region.
The math is clear: As each student leaves, so does a fraction of the base revenue available to the school system to cover foundational expenses, including teachers, secretaries, utilities and the like. Meanwhile, concentrations of high-needs students, like English learners and students requiring special education services, continue to rise where they are left in greater proportions than their peers, requiring more resources per student to provide equitable opportunities and access.
Reducing expenses for school systems proportional to revenue loss is difficult. School systems often make small, marginal changes that don’t lower expenditures to meet available revenues. This may undercut more meaningful, necessary steps — whole system re-evaluation of resource investments that match student need to the skills and expertise of educators. As a result, resources that should be dedicated to additional supports for students may instead get redirected to support basic school costs. This could leave high-needs students out in the cold instead of achieving the state’s intention to equitably allocate funds.
To avoid this, policymakers must ensure that any future LCFF adjustments include triggers that reconcile the base, supplemental and concentration grants to ensure proper alignment with enrollment and shifts in student need. School systems will also need guidance and support to analyze, design and manage these larger shifts. The formula for special education should be re-evaluated, given that funds are tied to overall student enrollment and not students with individualized education plans (IEPs).
Second, following any further LCFF adjustments, school systems will need policy, regulatory and funding incentives to seamlessly blend student programs like special education and English learner programs where such services are needed for the same multidimensional students.
Eighty-five percent of English learners are economically disadvantaged, as are 67.5% of students with disabilities. California’s high population of students with multiple needs requires additional support to successfully navigate school.
When supports are smartly combined — such as when English learner development support is integrated into a general education classroom — the result is the simultaneous delivery of good instruction and scaffolding for English learners in all general education classrooms. Directing funding to support one identified student need or a specific program sends a message to local school systems about where to direct resources. However, it can go too far. Unchecked, the system begins to look more like what we set out to get away from in the first place: layers of “categorical” programs funded with money that could only be spent in very restricted ways.
Policymakers must write policy that incentivizes and supports local educators to build programs that work together to address the multiple needs of students simultaneously. This includes reevaluating existing education funding to reduce its complexity, which would then allow local school systems to achieve coherent programs that seamlessly support the needs of the array of students being served on school campuses — from learning and instruction to collaborating with other agencies to provide supports such as food, health care and more.
Panelists at the Assembly hearing also noted the need to account for missing factors like geographic cost and economies of scale. While these factors are meaningful adjustments to account for school systems’ costs, introducing too many new, disparate factors can further burden school systems when they are required to track how each of those funding streams is being used. In fact, the governor just signed a bill to conduct a comprehensive review of the overwhelming amount of district reporting already required. Accountability and transparency are important, but too much will limit school systems’ ability to wisely blend and braid funding sources to construct coherent programs that support a wide range of student needs.
The Local Control Funding Formula has already helped California make significant headway to improve public education. By paying attention to changes in the student population and meaningfully accounting for them in funding and policy, the state will be better poised to deliver on its promise to close achievement gaps.
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Jason Willis is with the strategic resource allocation and systems planning team at WestEd, a nonprofit, nonpartisan research, development, and service agency that works to promote excellence, achieve equity, and improve learning for children, youth, and adults.
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