Chattanooga nonprofit calls for portable funding in local schools

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Chattanooga nonprofit calls for portable funding in local schools

Recently formed Chattanooga-based non-profit Metro Ideas is hitting the ground running, calling for the city’s school district to adopt student-based budgeting (SBB). Metro Ideas got involved in school finance by analyzing the wildly uneven relationships between school funding and student achievement. They recognize, like Reason, that these problems are exacerbated by flawed funding formulas that don’t put the focus where it belongs—the kids.

Under the status quo, states and school districts inefficiently fund various educational programs across districts and schools regardless of how many students actually need them at any given location. This wastes money that could be better spent directly helping students who need various additional services. Student-based budgeting changes that by giving each child a set amount of public education funding that follows them wherever they go to school. Making school dollars portable ensures that the resources flow to where the kids are learning.

Student based budgeting also accounts for the variety of different needs kids have. As Metro Ideas research director Jackie Homan recently noted, “In reality, some students cost more to educate.” SBB “weights” students with various extra needs with the dollars for their schools to help. Many SBB districts will typically weight several different factors, such as English language proficiency, poverty, or special education.

SBB also brings flexibility. As my colleague Aaron Smith recently explained, most SBB formulas are structured to give individual principals the autonomy to determine how to spend their school dollars since they’re best poised to know the needs of their students. The freedom allows these educators to experiment with the best ways of serving their students—better than any district central office can. As a result, over 87 percent of principals using SBB want to keep it.

Portable funding is being tried in over 30 districts around the country and the results are encouraging. Other small cities like New Orleans and Hartford have already made great strides for their special needs students through the extra weighting of SBB school finance system. Baltimore implemented student-based budgeting in 2009 and promptly experienced decreased juvenile crime, truancy, suspensions, and dropouts, while increasing its graduation rate.

As more districts across the country recognize the simplicity and fairness implicit in student-based budgeting, we’re glad to see others like Metro Ideas joining the fight.

Tyler Koteskey was an education policy analyst at Reason Foundation, a non-profit think tank advancing free minds and free markets.