The States With the Lowest and Highest Per-Pupil Public School Funding

Champions and failures in public school financing: How does your region measure up?

National Education Month serves not only as an excellent opportunity to recognize the significant contributions of educators and school personnel but also to evaluate how states allocate resources to public education. Findings from the Public Policy Institute of California indicate that “increases in expenditure result in better student outcomes, covering areas from test scores, to graduation rates, to college enrollment, to lifelong earnings and poverty levels.”

In this piece, Study.com investigates data from the United States Census Bureau’s Public Elementary-Secondary Education Finance from 2022 and 2023 to scrutinize how states distribute funds to public schools and the differences in funding strategies among states. Certain states are excluded from this evaluation due to lack of available data.

Funding Changes from 2022 to 2023

Numerous states have been striving to enhance public education budgets to improve student outcomes and bridge resource gaps. On a national level, this has resulted in the most significant increase in educational spending in two decades, with the U.S. Census Bureau announcing that in 2022 spending had surged by 8.9% compared to the previous year.

States have the discretion to determine how to distribute education funds, creating diverse experiences for public education across different regions. For instance, in Michigan, the 2023 educational budget centered on equity with resources allocated for special education, at-risk youth, rural transportation, and complimentary breakfast and lunch. In Minnesota, the education budget for 2023 increased by $2.3 billion from the prior year, directing more resources to local districts and introducing additional funding to bolster early childhood education. States such as Florida and North Carolina included expansions of school choice and voucher initiatives in their budgets.

Many states grapple with the challenge of keeping up with inflation—Wisconsin serves as one example, where critics of the educational budget contend that despite a $325 increase per pupil, the high inflation rate effectively undermines it. Another is Colorado, where school funding is determined by both enrollment and inflation. As enrollment in Colorado’s public schools has declined, funding increases have depended on inflation, which some argue neutralizes any financial advancements.

Effects of the Pandemic on Funding

The COVID-19 pandemic brought significant transformations to U.S. educational institutions, including an influx of federal funding. One component of the Coronavirus Aid, Relief, and Economic Security (CARES) Act was the Elementary and Secondary School Emergency Relief (ESSER) program, which allocated $189.5 billion to K-12 educational establishments.

In the pandemic’s initial stages, funds were directed towards enhancing and facilitating hybrid and remote learning, including providing students with laptops and access to WiFi. Consequently, the EdTech market witnessed a 17% annual growth throughout the pandemic, with states persistently investing in technology.

ESSER funds were also utilized to meet pressing needs, such as instituting health measures, supporting school operations, and aiding in schools’ reopening. Numerous schools allocated funds towards hiring teachers and enhancing staff salaries. Faced with a rise in student mental health challenges during the pandemic, educational institutions employed federal resources to maintain and expand mental health services. For instance, Florida dedicated $2 million from CARES Act funds to improve the ratio of mental health professionals to students in rural districts and broaden access to mental health services.

Changing Priorities After COVID-19 

The deadline for utilizing ESSER funds was set for September 30, 2024; however, some states have received extensions until 2026. As this influx of federal funding begins to diminish, states must revert to their pre-pandemic funding models and confront challenging decisions regarding which ESSER-funded programs and initiatives will persist.

In the post-pandemic landscape, priorities have shifted towards a more concentrated emphasis on academic recovery, student mental health, and retaining educators. A report by McKinsey revealed that districts aimed to allocate the remaining ESSER funds to tackle chronic absenteeism and enhance counseling services—Illinois intended to utilize its funds to strengthen social-emotional learning (SEL) support by creating SEL hubs statewide.

With shortages of teachers still affecting numerous districts and declining retention rates among educators, states have concentrated efforts on strengthening their own teacher recruitment pathways. While some states have modified their licensing processes to simplify the pathway to becoming a teacher, others have allocated resources to develop grow-your-own initiatives, which aim to recruit future teachers from existing support staff and aides.

Regional Disparities in Educational Investment

Each state employs a distinctive procedure or formula for determining its education funding, usually sourced from federal, state, and local levels. The majority of states calculate financing on a per-student basis (either determined by enrollment or attendance) with a greater emphasis placed on specific student demographics such as low-income and special education pupils. Other states utilize a resource-based model that allocates funds for services and staffing, or they apply a guaranteed tax base approach that relies on local and state taxation.