Press Release

North Carolina Should Revamp How It Funds Public Schools

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RALEIGH — North Carolina’s school finance system is broken and should be modernized with a student-centered approach that aligns dollars with children’s needs and provides local leaders the autonomy and flexibility to direct resources to tackle the most pressing challenges.

Education researchers Dr. Terry Stoops of the John Locke Foundation and Aaron Garth Smith of the Reason Foundation outline their case for transforming the state’s funding system in their report, North Carolina Public School Finance: Embracing a Student-Centered Approach To Benefit Every Child.

Legislative leaders are expected to begin restructuring the public-school finance system in 2020.

The current system – which dates back to the Great Depression – is saddled with flawed staff-based allocations, restricted funding allotments, and outdated rules that lead to unfair funding. The authors cite as an example the Classroom Teacher Allotment. A district with 170 second-grade students would receive 10 teachers, while a district with 169 students would receive only nine.

Complexity and confusion also plague North Carolina’s current system. So much so that, in a survey of district business officers, 77 percent responded that it takes at least two years to fully understand the allotment system.

Stoops and Smith lay out a reform plan grounded in fairness, transparency, portability, and autonomy. The recommendations ensure those closest to kids are empowered to make locally responsive decisions. Their analysis includes a look at funding reforms in Hawaii and Texas, which have adopted weighted-student funding.

Read the report.

Key Takeaways

    • North Carolina’s current school funding system is unfair, inflexible, outdated, and complex
    • Policymakers should embrace student-centered funding based on (1) fairness,
      (2) transparency, (3) portability, and (4) autonomy
    • Hawaii and Texas offer guidance for a funding formula that provides a foundational dollar amount that is the same for all students with per-pupil weights that adjust funding based on student needs
    • The more ‘unlocked’ dollars a principal controls, the more autonomy he or she has to align resources with locally targeted goals and strategies

Contact Dr. Terry Stoops, [email protected], 919-828-3876
or Mitch Kokai, [email protected], 919-306-8736

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About John Locke Foundation

We are North Carolina’s Most Trusted and Influential Source of Common Sense. The John Locke Foundation was created in 1990 as an independent, nonprofit think tank that would work “for truth, for freedom, and for the future of North Carolina.” The Foundation is named for John Locke (1632-1704), an English philosopher whose writings inspired Thomas Jefferson and the other Founders.

The John Locke Foundation is a 501(c)(3) research institute and is funded solely from voluntary contributions from individuals, corporations, and charitable foundations.