As much debate as discussions about weighted student funding generate, the basic concept is straightforward: Instead of allocating staff to schools and paying their costs, a district that uses a student-based funding model would simply allocate a set dollar amount to each school based on its actual mix of students. Each year, as the mix and number of students at each site changes, so would the allocation.
Such a system takes the mystery out of how districts allocate funds to each school and clarifies how funds move when enrollments shift. As students transfer from one setting to another, the funds designated for that student transfer as well.
Compare & contrast: Traditional funding v. student-based funding
Let’s compare a traditional funding model (based on total enrollment) with a student-based allocation model (based on actual number of students and their specific needs.)
The traditional staffing-based allocation system
The illustration below shows the budget of an actual Chicago school under a traditional staffing allocation system.
Figure 1: Traditional budget allocation to one Chicago School. From John Myers, “CPS Budget Analysis: CPS Eyes Equity,” Catalyst Chicago, February 2005.
In this model, school districts (rather than school leaders) hold the purse strings, deciding what gets purchased for each school (i.e., a principal, some number of teachers, a counselor, etc.) Larger districts use staffing formulas to determine how many of each type of staff a school gets, often allocating a vice principal for schools with more than 400 students, and so on. What’s then spent at each school is the actual salaries of the staff assigned to each school. The district spends more on schools with more staff per pupil or higher salaried staff.
Not surprisingly, this kind of allocation scheme – which allocates staff rather than dollars – tends to yield uneven per-pupil spending across schools.
The student-based allocation model
Now let’s look at a model budget for the same school, recalibrated under a student-based allocation model:
Figure 2: Student-based allocation based on actual student enrollment at the same Chicago school. From John Myers, “CPS Budget Analysis: CPS Eyes Equity,” Catalyst Chicago, February 2005.
Under the student-based funding model, dollars are allocated on the basis of enrollments for different types of students. This particular school would get an additional $3.5 million and change. (In the level funding environment created by this new model, some schools would also *lose* funds – a sticking point that often drives controversy.) In addition to the more equitable dollar allocations, school leaders also have greater latitude to ensure that staff and services address the real needs of the school’s individual students.
Real world benefits of student-based funding
From a practical standpoint, why would a superintendent want to consider student-based allocation?
- Equitable access: Students and families rightly have an expectation of equitable access to district resources. A system that routinely directs more funds to some schools (often smaller or wealthier sites) flies in the face of this basic principle.
- Portability: For school districts with choice-based assignment plans, funds are portable and follow individual children as they move to their preferred school.
- Flexibility: Part and parcel of the student-based funding model is that principals are no longer bound to adhere to district staffing models. Building leaders can apply their dollars in ways that best meet the needs of their particular mix of students – setting the stage for innovation. For instance, under student-based funding, school leaders have the opportunity to implement models such as blended learning – which depend on the ability to invest in technology, lab monitors, and a host of other nontraditional expenditures – to drive better outcomes for their students.
- Accountability: Districts with prescriptive staffing formulas can’t hold schools or principals accountable for the performance at their school, given that most of the resource decisions have been decided centrally. Furthermore, as schools use their flexibility to innovate and alter their delivery models, districts can ensure the financial viability of different school models by keeping per student (or per student type) costs comparable across all schools. Given the comparable funding, more successful models can be scaled across additional sites without draining undue funds from the district.
In the end, student-based allocation facilitates the goal of districtwide improvement: Funds follow students, thereby creating incentives for schools to attract students, keep full enrollment, and demonstrate excellent student performance. As families move their students to higher performing schools, the system begins to align to a continuous improvement cycle that drives ongoing performance gains at all schools.
A transition to weighted student funding (a.k.a. student-based allocation) is one of the key actions that defines portfolio school districts. Read our occasional series on portfolio districts for more detail.
Marguerite Roza, Ph.D., is Director of the Edunomics Lab at Georgetown University and Senior Research Affiliate at the Center on Reinventing Public Education. Dr. Roza’s research focuses on quantitative policy analysis, particularly in the area of education finance.