Weighted Student Funding Programs Continue to Show Promising Results
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Commentary

Weighted Student Funding Programs Continue to Show Promising Results

A survey of 20 school districts across the country that use some form of student-based budgeting finds it is working, particularly in large urban school districts.

Reason Foundation’s 2019 Weighted Student Formula Yearbook is out. This is the third edition of the yearbook, with the first two having been published in 2009 and 2013.

The WSF Yearbook is a survey of 20 school districts across the country that use some form of student-based budgeting (also known as weighted student funding or backpack funding)—an alternative system for funding public schools where uniform dollar amounts follow individual students to any school in the district and where students with more needs receive more dollars. This edition is different from past editions in that it focuses on highlighting recent updates to WSF district systems and in that it’s generally less prescriptive since different districts have different goals, serve unique communities, and are developing divergent understandings of the weighted student funding model. 

Weighted student funding is meant to be a significant improvement on the prevailing district funding model for several reasons. The vast majority of school districts in the country fund individual schools by allotting staffing positions and special programs, not actual dollars. This diminishes equity, reduces transparency, and poses challenges to school-level flexibility. Students are receiving different amounts of resources for reasons unrelated to their needs, and school leaders also find themselves unable to change how dollars are used at the school level because they must follow a long list of mandates from the district, state, and federal levels. This is unfair both for taxpayers and families. WSF mitigates these problems by equalizing dollars for similar students and by empowering local leaders with the flexibility to make budgeting decisions that are best for their communities. 

There are roughly 30 districts (20 of which are featured in this study) using some form of student-based budgeting. Each WSF district operates a hybrid model, where some resources (generally between 30 percent and 50 percent) are disbursed via a flexible, student-based formula and other resources are disbursed via categorical funding streams, which can only be spent on certain programs or certain students. With that in mind, we decided to focus on (1) the history of each district’s program and broader funding system, (2) the overall percentage of operating dollars that are given to schools via a student-based formula, and (3) the specific weights used in that formula to direct more dollars to students with special learning needs. These three key components can help policymakers who are considering the WSF model evaluate different options based on their particular needs without getting trapped in the mindset that there’s one optimal model. 

There are several overall trends to note in the new yearbook. Firstly, many large urban districts—such as Atlanta, Indianapolis, Cleveland, and Metro-Nashville—have adopted student-based budgeting in the last three-to-five years. This is encouraging because it shows that districts with older WSF programs are seeing promising results that attract other districts to the funding system. 

A second key trend is a wide variety in both the kinds and the magnitudes of the weights districts use. For instance, Milwaukee Public Schools has a very simple formula. They provide different base allocations for students based on grade level—currently between $3,000 and $3,500, depending on grade level—and give an additional $50 for each student classified as an English language learner (ELL). This is a very small ELL weight in comparison with most other districts that use ELL weights. While Milwaukee does give teachers and additional resources for the ELL students and other students with additional needs, they choose to do so outside of a uniform formula. 

Similar variations can be found in how districts fund special education (SPED). Baltimore’s formula has only one special education weight that currently allocates an additional $641 per SPED child, while Cleveland Metropolitan Schools has five different weights that allocate as much as $7,965 additionally per student. Again, this doesn’t necessarily mean that Baltimore spends less on SPED—but it does mean that most of their additional allocations for SPED are handled outside of the formula and are therefore spent more rigidly. More generally, school districts also vary in whether they have weights for poverty, gifted students, different grade levels, etc., as well as how big those weights are. These weights will be discussed in forthcoming pieces on our website.

While there is no optimal system, it’s important to point out that school districts that want to make bigger strides in increasing both equity and school-level flexibility should aim to put as much of their operating dollars in the weighted student formula as possible and should adopt a simple yet sufficient set of weights. This way, all students get the resources they need and individual schools have the freedom to use those dollars in ways that make the most sense for them and their students.  

The growing popularity of the WSF model, especially among high-need school districts, demonstrates that it’s possible to have a funding system that treats students fairly while simultaneously empowering principals and school-level leaders to make decisions. Policymakers and researchers should watch diligently and hopefully as these funding programs continue to develop across the country.

Christian Barnard is a policy analyst at Reason Foundation, a non-profit think tank advancing free minds and free markets.