New York City Schools Should Continue Using Fair Student Funding
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New York City Schools Should Continue Using Fair Student Funding

Fair Student Funding is set of best practices that can drive innovation, change, and accountability.

New York City made a splash last month with plans to welcome Richard Carranza as the city’s new school chancellor. Carranza, who previously served as superintendent of Houston Independent School District (HISD), is viewed by many as a controversial figure due to his recent decision to move away from student-based funding and centralize operations in Houston. While it is still yet to be seen what his tenure in New York City will look like, many rightly fear he could undo years of painstaking progress achieved under the city’s previous chancellors.

For a little over a decade, New York City Schools has been using a funding system called Fair Student Funding, which distributes per-pupil funding to schools based on the characteristics of the students who enroll in each school. Originally introduced by former New York City Mayor Michael Bloomberg and New York City Schools Chancellor Joel Klein, Fair Student Funding is a reformist approach to education funding that differs from previous funding systems in that it does not allocate budget dollars based on staffing. Instead, schools receive funding based on the number of students who choose to enroll. Each student then receives a weighted dollar amount, to reflect his or her needs. For instance, English Language Learners and children who need special education services receive greater dollar amounts than other students. This allows for a much more equitable distribution of resources.

However, Fair Student Funding is more than just a funding formula. It is set of best practices that can drive innovation, change, and accountability. It favors a decentralized approach to education. Schools receive greater autonomy and principals are empowered to make decisions over important issues like budgets and resource allocation.

However, in New York City, the more equitable Fair Student Funding system has never been fully funded and spending on district-wide initiatives mean that only about $6 billion of the $30 billion dollar budget, or 20 percent of the budget, flows to schools through the Fair Student Funding formula. Yet, funding is still more equitable than under the old staffing system, where politics and a principal’s political and negotiating skills largely determined funding at individual schools. 

It is critical for the city’s students that these best practices are preserved. Ideally, they’d be expanded upon to help the city reach the full potential of weighted-student funding in its schools.

It would be a catastrophic mistake to roll back Fair Student Funding and return to a system where staff salaries and not student needs determine how much money each school receives.  Hopefully, New York City’s new chancellor also comes to see it that way.

Nate Scherer

Nate Scherer is an education policy analyst at the Reason Foundation.