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Measuring Disparities in Cost and Spending across Connecticut School Districts

Nicholas Chiumenti and Bo Zhao ()

No 20-2, New England Public Policy Center Research Report from Federal Reserve Bank of Boston

Abstract: Despite multiple court cases and repeated efforts at reform, there are still significant concerns about the equity and the adequacy in Connecticut’s public K–12 education funding. One vital component of any attempt to reform education finance is a methodologically rigorous evaluation of what it would cost school districts across the state to achieve target performance standards given their student characteristics. This report addresses that need, evaluating the equity and the adequacy of school spending in Connecticut based on education costs. Different from actual school expenditure, a district’s education cost is an estimation based on its cost factors that are outside the direct control of local officials at any given point in time; efficiency levels are held constant across school districts in the estimation. This report finds large disparities in education costs due to differences among school districts in cost factors. It also finds that, despite existing state aid programs, disparities in cost-adjusted spending across the state remain large. Spending in some districts is well below the levels needed to achieve common performance goals. Among the specific findings of this report is that in the last year for which data were analyzed, the average costs of school districts with the lowest socioeconomic status and highest level of student need were 62 percent greater than those of districts with the highest socioeconomic status and the lowest level of student need. When this report holds every district’s efficiency at the statewide average level, it finds that more than half of Connecticut’s public school students attended districts where spending was insufficient to meet the “predicted costs” to achieve the statewide average student test performance level. A direct, negative consequence of spending inadequacy is student underperformance relative to the common student performance target. This report recommends that the state consider adopting the cost measure as the basis of a new, scientifically grounded, equitable, and adequate formula that allocates more state aid to districts with higher costs. It also suggests that many districts need to increase their spending to meet their predicted costs and close the gap between student performance and the common goal. The exact amount of the additional spending needed partly depends on the state’s choices for the student performance target and the common level of district efficiency. For example, this report estimates that in the last year analyzed, with district efficiency held at the statewide average level, an additional $940 million, or an increase of 12.3 percent from statewide public K–12 school spending, would have been needed to fully fund the predicted costs required to achieve the statewide average student test performance level in every district. While the state and local governments now face great fiscal difficulties induced by the COVID-19 pandemic, they should remain committed to the investment in public education, because it will affect Connecticut’s economic growth in the long run.

Keywords: NEPPC; Connecticut; municipal aid; education funding; COVID-19 (search for similar items in EconPapers)
Pages: 28
Date: 2020-09-01
New Economics Papers: this item is included in nep-ure
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