Blog Post 1: Preparing for the ESEA Financial Transparency Provision

The amounts of money school districts spend per student—and disparities in these amounts across schools—have received little attention outside of the research community. While there are many reasons for this limited attention to student-level spending from policymakers and local leaders, one of the primary factors has been the lack of data on school-level funding.

The Elementary and Secondary Education Act of 1965 (ESEA), as amended by the Every Student Succeeds Act (ESSA), requires states to publicly report spending for each school disaggregated by federal, state, and local funding, creating opportunities for local leaders to analyze and describe funding in more detail than before (i.e., at the individual school level, rather than just a district average). With these new analyses may come new challenges, as more transparent school-level funding descriptions may spur conversations about why funding varies across schools (for more information, please see the Financial Transparency and Reporting Readiness Assessment Tool from the State Support Network).

This four-part blog series will discuss considerations for districts as they implement the school-level spending provision in ESEA, including how to report per-pupil expenditure data, use these data to inform resource allocation decisions, and communicate with stakeholders about state and local resource allocation practices and decisions.

Four Strategies for Publicly Reporting School-Level Spending

Recognizing that school-level spending data are complex, and therefore vulnerable to misinterpretation or misunderstanding, this first blog post describes four strategies districts can use to prepare for engagement about the public release of school-level spending reports. Many of these strategies were informed by experts at Georgetown University’s Edunomics Lab and Education Resource Strategies (ERS) as part of their work to support states in reporting school-level spending.

Strategy 1: Gathering School-Level Data

Many states and districts do not currently track or report financial data by school, which might make gathering school-level data challenging. States and districts will need to work together to identify and analyze school-level expenditure data. Specifically, state and district leaders will need to determine:

1. How expenditures are divided across school levels versus central levels
2. Whether these data (school and financial) are accurate and complete
3. How funds are spent at the school level and central level
4. How different approaches to attributing centrally held funds affect per-pupil spending variations across schools

The Financial Transparency and Reporting Readiness Assessment Tool, produced by the State Support Network, can help states and districts make these determinations.

Strategy 2: Exploring and Understanding the Data

Districts should consider the following questions around current funding trends and potential inequities:

1. Do some schools stand out as getting less or more funds per student? If so, is it clear why these schools are receiving less or more?
2. Are district allocations for high-need students boosting spending at high-need schools?
3. Are salary patterns driving uneven spending in ways that may negatively impact some students or raise concerns from the community?
4. What share of funds is centrally managed? Are all of the funds reported as centrally managed actually used for central-office functions, or do some of them fund direct services in schools? Is centralized spending at the district level designed to be efficient and targeted? Are the data telling the full story, or should the district or state adjust its approach to reporting school-level funding by specifying which schools receive support from the funds held centrally?
5. Considering student needs, how do student outcomes relate to school-level spending per student? Are some schools, given equivalent resources and similar student populations, better able than others to leverage funds to improve student outcomes? Strong analyses will consider multiple measures of student outcomes. Once multiple years of school-level per-pupil data are available, are some schools making greater progress using similar resources?

To answer these questions, districts may find the below tools helpful:

• Toolkit: Advancing Equitable School Funding Under ESSA, produced by ERS
• A Checklist to Guide Data-Visualization Decisions, written by Marguerite Roza and Katherine Hagan for the Building State Capacity and Productivity Center

Strategy 3: Preparing State and District Leaders to Communicate About Spending Data

For most states, school-level spending data from 2018–19 will not become publicly available until late 2019 or early 2020. State and district leaders should use the time available before the data release to prepare for how they will communicate this information to the public. State and district leaders should work together to answer the following questions:

1. What kinds of funds should be excluded from reporting?
2. What funds should be reported at the district level, versus at specific schools?
3. How should we attribute funds reported at the district level down to schools?
4. How do we break out state and local funds from federal funds?
5. How should we handle higher transportation costs for rural schools in a way that does not mask or inflate the level of resources dedicated to student learning?

By reflecting on these questions, state and district leaders can get a jump on preparing straightforward answers for the public on what’s driving per-pupil calculation decisions. State and district leaders can also avoid confusion or misunderstanding by the public by using similar messages and terminology in their communications around per-pupil expenditures.

(Note: Blog Post 2: Going Beyond Finances in Resource Allocation Decision Making will feature more details regarding drivers of spending differences.)

Strategy 4: Implementing Community and Stakeholder Engagement

Districts may wish to engage school leaders and boards of education in discussions around school-level spending data as soon as possible, so school leaders can start to build transparency, trust, and feedback loops with community members and other stakeholders (e.g., parents, teachers). By conducting these conversations prior to the public release of data, districts can provide important context and background information to explain the data and reduce the potential for misconceptions that may arise from the data being seen without any prior context. By having early and honest conversations with stakeholders, districts can also generate input and support for potential strategies for addressing inequities.

Interested in Learning More?

For more information, check out these articles:

• Coming Soon: Transparent School-by-School Spending, written by Marguerite Roza and Carrie Stewart, both with Edunomics.
• What Is Resource Equity? written by Betty Chang with ERS.

Coming Soon…

Over the next few weeks, this blog series will share more information on how states and districts can effectively plan for public communication of school-level spending data, including examples from states and districts currently engaged in this work. Look for the following posts in this blog series:

• Blog Post 2: Going Beyond Finances in Resource Allocation Decision Making The second blog in the series will focus on how to incorporate per-pupil expenditure data into district- and school-level resource allocation decision making that goes beyond just financial resources.
• Blog Post 3: Preparing for the Financial Transparency Provision: State Examples The third blog in the series will highlight the initial and ongoing steps that two states have taken to prepare for the financial transparency provision.
• Blog Post 4: Recap The fourth blog in the series will summarize the key takeaways from the series and highlight the work happening at the district level around school-level spending reporting in Oregon and North Carolina.

Click here for the next post in the series, Going Beyond Finances in Resource Allocation Decision Making.