Senior Vice President for State Fiscal Policy
As a new school year dawns, America’s schools face attacks from three directions: upended learning methods, a state revenue crisis, and racial disparities in education that threaten to weaken the quality of our children’s education and our communities’ economic future.
COVID-19 is making traditional education methods impossible, leaving teachers, administrators, parents, and students scrambling to devise new approaches. Educating kids safely in this pandemic would pose an enormous challenge even if our schools had all the funding they need. But, right now, they have far less than that.
That’s due largely to the state revenue crisis that the virus and resulting recession have sparked, forcing states to likely make budget cuts to meet their balanced-budget requirements. With businesses closed, shoppers home, and unemployment high, income and sales taxes — upon which states overwhelmingly rely to fund education and other services — have nosedived. As a result, we estimate that states face a $555 billion shortfall through 2022. Local tax revenues are falling, too, putting local governments in a similar bind.
Schools have received some extra federal money to address the immediate costs of adapting to COVID-19, but it’s far too little to cover even the necessary hand sanitizer, face shields and masks, distance-learning equipment, and other pandemic-related costs that they face, much less to replace lost revenues.
Without significant new federal aid, states and localities will likely make deep cuts to balance their budgets. Education comprises about 26 percent of state budgets, so it’s a prime target. And school districts have few other funding sources: states and localities provide 47 and 45 percent of all K-12 funding, respectively.
States have sought to shield schools from cuts, but they may not be able to do so much longer. Georgia lawmakers have already cut $1 billion from the state’s budget for its Education Department, and Nevada cut school funding by $160 million. New Jersey anticipates school cuts that could reach $1 billion per year. Virginia’s governor is recommending that the state abandon $490 million in planned school funding.
The last time that school districts across the country cut their budgets so deeply, kids’ educations suffered. In the wake of the Great Recession of a decade ago, states spent down their reserves and the sizable federal aid they received and then cut funding to K-12 schools to balance their budgets. By 2011, 17 states had cut per-student funding by more than 10 percent. As a result, local school districts cut teachers, librarians, and other staff; scaled back counseling and other services; and even reduced the number of school days.
Even in 2017, state support for K-12 schools in some states remained below pre-Great Recession levels. And school districts have never recovered from the layoffs they imposed back then. When COVID-19 hit, K-12 schools employed 77,000 fewer teachers and other workers despite teaching 1.5 million more children.
Money matters in education. As my colleague Cortney Sanders recently noted, “Adequate school funding helps raise high school completion rates, close achievement gaps, and make the future workforce more productive by boosting student outcomes, studies show.” The Great Recession in particular hurt students’ educations, driving down test scores and college attendance rates, Northwestern University economist C. Kirabo Jackson and two colleagues found.
Which brings us to the third big assault on public schools: Schools attended by low-income children and Black and Latino children are less well-funded, on average, than the schools of wealthier white kids — and budget cuts could hit them hardest. Unlike the virus and recession, this assault isn’t new. Schools in America have been unequally funded from the start, and even the landmark Brown v. Board of Education decision over six decades ago didn’t end those disparities.
While state funding typically reduces disparities between wealthy and poor school districts, funding cuts magnify those disparities — and that’s what happened during the Great Recession, when state funding fell as a share of total school funding. Today, in only about a third of states is total state and local funding higher in the poorest school districts — which face higher costs —than in the least-poor districts.
Now, new school funding cuts seem to be following a similar path. For example, Virginia’s proposed state budget cuts are twice as large per pupil for high-poverty school districts as low-poverty districts, and 23 percent larger for the districts with many students of color than for those with mostly white students, the Commonwealth Institute reports.
This triple threat facing schools suggests that policymakers should take a similarly multifaceted approach to protect K-12 schools.
First, the President and Congress must enact a federal aid package that includes not only substantial funds earmarked for school districts but also substantial general-purpose funds to replace lost state and local tax revenues.
Second, as a condition of receiving this substantial federal aid, states and school districts must guarantee — under what would be a “maintenance of equity” requirement — that they’ll protect funding for school districts that serve high shares of low-income children.
And third, states likely will need to draw down their reserves, close tax loopholes, raise new revenues, and find other ways to protect education funding and other programs that serve children and families.
The education of a generation is at stake.