The sunlight effect: More equitable spending on its way regardless of rulemaking

Last week I listened in on the Department of Education’s contentious negotiated rulemaking session. The topic of debate was the “supplement-not-supplant” provision of the Title I program—a bedrock of the newly reauthorized Every Student Succeeds Act (ESSA) designed to help low-income students by funneling aid to school districts based on student demographics. At issue is whether federal regulations should require recipient districts to divvy up their funds so that their high-poverty schools get as many dollars per student as their schools with more affluent students.

This seems like a no-brainer, given the goals of Title I. But the proposed federal rules are controversial precisely because many big districts don’t, in fact, divide their funds equally. Rather, most districts (perversely) send a smaller share of their state and local funds to the schools with the most poor and minority students —even in progressively minded cities like Seattle.

One would expect such systemic inequities to trigger outraged local headlines, fiery deliberations on district budgets, racially charged school board meetings, accusations of civil-rights violations, equity lawsuits, signature campaigns, and the like. Unlike inequities across districts, these school-by-school inequities are not some artifact of wildly varying property values and local levies. After all, a district decision to spend less on one school versus another is just that—a decision by district officials to deploy the already-collected public funds under their watch inequitably.

There’s a reason there hasn’t been massive public pushback against the systematic mistreatment of schools with the most vulnerable students: We’ve never before had the clear large-scale school-by-school evidence. Up to now, collecting school-level spending has been largely an academic pursuit. The evidence we do have tends to be forensically cobbled together by researchers on a particular locale and is often a few years old. Dig through a district’s financial documents (all are public information) and, in most cases, there is simply no spreadsheet that shows district spending by school. Ask a district official whether the school system spends more on one school versus another and you’ll hear that district accounting practices just don’t record spending that way.

That’s all about to change.

For more than a decade, the federal government has required districts to report student outcomes by school. Spending was the missing piece. The new federal ESSA rights that wrong and will require districts to account for school-by-school spending and publicly report it. 

When the spending data are daylighted, the evidence will be clear that many districts have hardwired systematic spending inequities in their operations.  In my hometown of Seattle, when the community sees that the district is sending a larger share of its state funds and locally approved levy dollars to schools with the fewest minorities, there will be a reckoning. District officials might say it wasn’t intentional and only happened because teachers make different salaries amounting to $22,000 more per teacher at the northernmost high school (where poverty is relatively low) than in the district’s southernmost high school (where poverty is greatest). Or they could suggest that it doesn’t matter, since salaries don’t equate to quality. But some groups are unlikely to accept that rationale. That’s when the negotiation will happen. Similarly, in cities where the board steers funds to a subset of well-connected schools, the daylighting can trigger productive debate and change toward equity.

While some on the federal rulemaking committee fear that a push for equity would be “a nightmare” as districts scramble to remedy inequities, this is exactly what is coming. And it’s coming regardless of whether the new federal regulations require spending equity or not.

That’s because the transparency requirement will surface spending patterns that for many districts will be indefensible. School boards will have no choice but to do the hard work of rethinking longstanding policies that contributed to the uneven spending. Clearly the wrong path is to force mass reassignment of teachers. Instead, better fixes may involve multiple years of incremental changes in staffing and compensation policies, district allocation strategies, and school-level resource flexibility. Local conditions and political pressures will matter as districts dive into this admittedly tough work. “Nightmare” or not, this inevitable reckoning is long overdue in districts that shortchange poor and minority students.

What’s an appropriate federal role in crafting regulations here?  The Department of Education wants to make sure someone keeps an eye out for students in Title I schools.  Perhaps the savviest play is to have states track and monitor spending on Title I schools versus non-Title I schools. Some states will take action on the data, and in others, the data will arm groups fighting for equity. In states where inequity is left unaddressed, such data can inform future iterations of federal regulations. 

Regardless, the ESSA requirement for school-level spending transparency is a game changer.  And whatever happens with the rulemaking process won’t change that.