Whether the Department of Education is able to finalize its proposed rule on a change to a fiscal rule in the Every Student Succeeds Act (ESSA) will have sweeping effects for all students in the United States. The change was supposed to be straightforward, yet this has not been the case.
Associate Professor - McCourt School of Public Policy, Georgetown University
Former Brookings Expert
In ESSA, Congress redefined how districts must show compliance with Title I’s supplement-not-supplant (SNS) rule. The Department of Education has proposed a substantively different regulation on SNS, which is now in the notice and comment period during which members of the public have the option to submit written feedback to the Department on its proposed rule. For now, school districts are in a holding pattern, unable to plan for implementation.
From my perspective, here’s what you need to know before the comment period closes on November 7.
What does ESSA say about supplement-not-supplant?
The SNS provision in ESSA says that school districts need to show that their resource allocation methodologies prevent any Title I school from getting less state and local money than it would have if it didn’t participate in Title I.
While this is an oversimplification, the Department’s proposed rule would require districts to spend roughly equal amounts of state and local revenue per pupil in Title I and non-Title I schools. That is, it assumes that if there were no Title I program, the district would have funded each school equally.
Substantively, this is quite different from both ESSA and the Department’s own guidance on Title I schoolwide programs (to whom the new language already applied under NCLB). The proposed rule has a few additions but is substantively quite similar to a draft that failed to generate a consensus at negotiated rulemaking this spring.
The rule is clearly well intentioned. The Department thinks forcing nearly equalized funding is a good strategy for helping disadvantaged students, in keeping with the spirit of Title I, and that auditors need a highly specific rule to make it happen.
What’s wrong with the Department’s rule?
That’s because the rule on its own does not solve the problem motivating it—that poor kids don’t have equal access to good schools, not just high-spending ones. Requiring that districts move closer to equal spending across schools, as the proposed rule does, may simply shift high-cost, but less effective resources to students in need.
High-poverty schools—many of which are not served by Title I—spend less than richer schools. As Sec. John King told Michel Martin of NPR, differences in teacher experience levels (and therefore, differences in salary) are “a very large driver” of such school spending gaps. The lower average teacher experience levels in high poverty schools stem from their higher rates of teacher turnover, itself a symptom of a bigger problem: research shows that teacher turnover is related to problems with school leadership.
Sending more money to schools with high turnover would change funding gaps, but won’t necessarily change school leadership gaps or teacher effectiveness gaps. It’s very likely that these new funds would come in the form of experienced teachers from elsewhere in the district—who, as I’ve explained here, the district is contractually obligated to employ somewhere, but may well be expensive without being good.
Even more perversely, the proposed rule would actively work against districts that want transparent and consistent resource allocation systems. Instead, districts would have to do significant parts of their budgeting in an ad hoc manner to make the numbers come out right each and every year.
The rule also could prompt districts to change which of their eligible schools participate in Title I: a district’s total allocation of Title I funds is set according to student, not school characteristics, and districts themselves have considerable discretion over how much to concentrate those funds in their poorest schools or to spread them more thinly over more schools. Different districts choose different strategies: according to NCES Public School Universe data, thousands of Title I schools nationally have fewer than a third of their students eligible for free lunch, while at the same time thousands of non-Title I schools have over half their students eligible. The proposed rule wouldn’t change the amount of discretion districts have over Title I participation at the school level, but could mean that compliance concerns, rather than educational ones, dictate the choice.
Is the law enforceable without a complicated regulation?
There’s a common misperception that absent regulation, school districts would have free rein over federal funds, with no safeguards for poor students. That’s flat-out false: all agencies receiving substantive federal funds are legally required to undergo an annual “single audit” of these funds. Nothing about ESSA changes this. To understand how an audit would work, we can break down the one relevant sentence of the law.
What’s a methodology?
ESSA’s SNS language is all about the methodologies school districts use to allocate funds. A methodology is simply a way of establishing a baseline of what a district pays for—with state and local funds, excluding Title I—in any given school. It doesn’t need to be a complicated formula. It could be written in sentences, or budget tables. For example, part of a district’s methodology could be using state and local funds to support one teacher per 25 students in grades K-3. Most districts already have some methodology, typically in the form of allocating personnel and actual goods, rather than dollar amounts, to schools. SNS ensures that these methodologies don’t shortchange Title I schools because of their participation in Title I.
Under ESSA, how could a district demonstrate that its methodology complies with the law?
Each school needs to get whatever state and local resources it would get if Title I went away tomorrow. An auditor would check that state and local funds were actually allocated according to such a methodology. If, as in the example above, state and local funds are to support one teacher per 25 students in grades K-3, the auditor would check that any Title I funds spent on K-3 teachers line up dollar for dollar with reductions below that baseline class size in Title I schools.
In contrast, if a district used state and local funds to cover one teacher per 25 students in its non-Title I schools, but only got to that same ratio in its Title I schools through a combination of federal Title I dollars along with state and local funds, the auditor would—in keeping with the letter and spirit of the new law—find the district in violation.
Don’t be fooled by the law’s lack of technical jargon or equations. ESSA wisely eliminates cost-by-cost testing for SNS, a practice which discouraged schools from spending Title I funds on comprehensive services and perversely encouraged spending on add-ons (like pulling students out of academic classes to work with paraprofessionals) that met compliance standards but were not necessarily helpful in improving educational outcomes for low-income students. Through the revised SNS provision in ESSA, school districts are freed from this restrictive formula, but they are still required to report how they spent their Title I funds—and the law’s plain language gives auditors what they need to check the books.
What happens next for the rule?
Public comments will be accepted in the Federal Register through November 7. Many of these so far are from teachers, a natural constituency to oppose the proposed rule, and a highly organized group when it comes to public comment.
Individual state and local administrators are also taking time to compose original comments, often making points similar to those raised by the negotiators who wouldn’t sign off on a similar proposal this spring. In order to finalize the rule, the Department will need to respond to comments and get approval from the Office of Information and Regulatory Affairs. Even if the rule is finalized without substantial revisions, there are real questions about whether it would stand up to litigation, throwing further uncertainty into the mix.
The bigger question: what happens next for equity?
As Marguerite Roza has written here, ESSA’s new reporting requirements will allow public scrutiny of school-level resource gaps. But this is the first, not the last, step in ensuring equity across schools. Attention to these gaps should raise some uncomfortable questions about what’s generating them. Equity advocates—including everyone on both sides of this SNS discussion—should prepare to make these questions pointed, public, and productive.
Nora Gordon is associate professor of public policy at Georgetown University, research associate of the National Bureau of Economic Research, and non-resident fellow of the Brookings Institution. She has testified on the implications of the proposed supplement not supplant regulation before the Senate Committee on Health, Education, Labor and Pensions and the House Subcommittee on Early Childhood, Elementary, and Secondary Education.
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