by Dr. Terry Stoops
Director of the Center for Effective Education, John Locke Foundation
Last week, the Education Law Center published “Making the Grade 2019,” a report that focuses exclusively on three categories of public school inputs: funding levels, distribution, and effort using data from the 2016-17 school year.
In the report, the more state and local funds spent per student, the better it did in the funding level category. Funding distribution assessed the relationship between funding and poverty level. States that do more to provide additional funding to high poverty districts fared better in this category than those that tend to fund low poverty districts at higher levels. Finally, funding effort is the total state and local revenue divided by the state gross domestic product. North Carolina received an F in both funding level and funding effort and a C in funding distribution.
The shortcomings of the report are numerous. The study makes no mention of student achievement, nor does it attempt to consider the relationship between spending inputs and performance outputs. While some may dismiss this focus on educational productivity or “return on investment,” such considerations raise important questions about how taxpayer money is used to achieve shared educational goals.
More importantly, context matters. Even the Education Law Center researchers warn, “The funding distribution measure uses district-level data to determine a state’s overall pattern of school funding. It is important to recognize that this measure may not capture the variations in a complex system.” This is true for the other measures in the report, as well. No two states fund public schools in the same way. Some states rely heavily on state funds. Others use property taxes to cover the bulk of education expenses. The size of the public school population, economic factors, tax system, etc. also play notable roles in determining the state’s spending on public schools. These are meaningful differences that should inform comparisons of North Carolina to any other state.
In his Friday EdNC column, Ferrel Guillory highlighted the “Making the Grade” report to make the case that the General Assembly is underfunding public schools. He wrote,
A section of the report specifically contrasts North Carolina and South Carolina in their ability and effort in financing public education. “Where the Carolinas diverge is on effort,” says the ELC. “North Carolina ranks 48th on effort, while South Carolina ranks 8th. The difference means that South Carolina has funding levels at the national average while North Carolina, the wealthier state, funds students at a level nearly $4,000 per pupil below the national average.”
A legislative year that is “one for the history books’’ leaves unresolved not only the power struggle within a divided government but also a biting question for a top 10 state: When will North Carolina catch up with South Carolina?
A better question: is public school funding in North and South Carolina an apples-to-apples comparison? Yes, these states share a border and the word “Carolina” in their names, but they have very different systems of public schools.
According to the National Education Association’s 2019 “Rankings and Estimates” report, North Carolina is one of 24 states where the majority of public school revenues come from the state. The NEA estimates that 56 percent of revenue comes from state sources, which is considerably higher than the national average of 47 percent. It is also higher than South Carolina, which generates 48 percent of its revenue from state sources.
South Carolina makes up for the lower state contribution by asking localities to contribute more. Around 43 percent of public school revenue in South Carolina comes from local sources, whereas only 34 percent of public school revenue in North Carolina comes from local governments. The national average is over 45 percent. In other words, local governments in South Carolina contribute a much greater share of total revenue than their neighbors to the north. “Catching up” to South Carolina would require our county commissions to increase their funding of public schools significantly.
According to the Urban Institute’s “America’s Gradebook” online tool, after adjusting for age, race/ethnicity, special education status, free and reduced-price lunch eligibility, and English language learner status, fourth- and eighth-grade students in North Carolina outperformed their counterparts in South Carolina in reading and math on the 2019 National Assessment of Educational Progress (NAEP) tests. When it comes to student performance, when will South Carolina catch up with North Carolina?
States are laboratories of innovation. There are many opportunities for states to learn from one another. But North Carolina should choose its peer states carefully and only emulate those that have a track record of success, rather than just spend more.