Basing K-12 funding on school enrollment can lead to problems

from Carolyn JonesCalMatters

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For years, California schools have pushed to change the way the state pays for K-12 education: by basing funding on enrollment instead of attendance. That’s the way 45 other states do it, and it would mean an extra $6 billion a year in school coffers.

But such a move could do more harm than good in the long run, as tying funding to enrollment means schools have little incentive to lure students into class every day. according to a report released Tuesday by the nonpartisan Legislative Analyst’s Office. Without this incentive, attendance will drop and students will suffer.

If the Legislature wants to increase school funding, analysts say, it should use the existing attendance-based model and direct more money to schools with high numbers of low-income students, foster care students and English language learners.

When it comes to attendance, money talks, the report notes. For more than a century, California has funded schools based on average daily attendance — how many students show up each day. In the 1980s and 1990s, the state began to look for alternatives. A pilot study from this period showed that high school attendance rose 5.4 percent and elementary school attendance rose 3.1 percent when those schools had a financial incentive to increase attendance.

Now is not the time to ease attendance problems, the report said. Although attendance has improved somewhat since campuses closed during the pandemic, it remains well below levels before COVID-19. In 2019, nearly 96% of students came to school every day. The number dropped to about 90% during COVID-19, when most schools switched to distance learning, but it still remains about 2 percentage points below its previous peak.

Attendance is linked to multiple measures of student success. Students with strong attendance tend to have higher test scores, higher reading proficiency levels, and higher graduation rates.

“It’s a thoughtful analysis that weighs the pros and cons,” said Hedy Chang, president of the nonprofit research and advocacy organization Attendance Works. “For some districts, there may be benefits to the funding shift, but it also helps when districts have a specific incentive to encourage kids to show up.”

The true cost of educating children

The schools have long asked the Legislature to change the funding formula, which they say doesn’t cover the actual cost of educating students, especially those with high needs. The issue was brought up repeatedly at a recent California School Boards Association conference, and there is at least one recent bill that addresses the issue.

The billfrom an ex Senator Anthony PortantinoDemocrat from the La Cañada Flintridge area, initially called for changing the funding formula, but the final version simply asked the Legislative Analyst’s Office to study the issue. The bill was passed in 2024.

A 2022 report by Policy Analysis for California Education also noted the risks of eliminating schools financial incentive to prioritize attendance. But it also said that increasing school funding in general would give districts more stability.

Enrollment is a better indicator of funding because schools have to plan for the number of students who enroll, not the number who show up, said Troy Flint, a spokesman for the California School Boards Association.

He also noted that schools with higher absenteeism rates also tend to have higher numbers of students who need extra help, such as English language learners, migrant students and low-income students. Tying funding to daily attendance — which in some districts is as low as 60 percent — brings less money to those schools, ultimately hurting the students who need the most help, he said.

“It just compounds the problem, creating a vicious cycle,” Flint said.

To truly increase attendance, schools need additional funding to serve these students.

Moving to an enrollment-based funding model would increase K-12 funding by more than $6 billion, according to the Legislative Analyst’s Office. Schools currently receive about $15,000 a year per student through the state’s primary funding mechanism, the Local Control Funding Formula, with an additional $7,000 coming from the federal government, block grants, lottery money, special education funds and other sources. California in general spent more than $100 billion on schools last year, according to the legislative analyst.

Motivated by money?

Flint’s group also questioned whether schools are motivated solely by money to get students into class.

“Most people in education are desperate for kids in class every day,” Flint said. “These are some of the most dedicated, motivated people I’ve ever met, and they care deeply about the students’ well-being.”

Josh Schultz, Napa County superintendent of education, agreed. Napa schools that are funded through attendance actually have lower attendance than schools that are considered “essential aid” and are funded through local property taxes. Both types of schools have large numbers of English language learners and migrant students.

“I can understand the logic (of LAO’s claim), but I don’t know if it actually bears out, at least here,” Schultz said. “Both types of schools see great value in children coming to school every day.”

This article was originally published on CalMatters and is republished under Creative Commons Attribution-NonCommercial-No Derivatives license.