Education reforms in state budget could narrow achievement gap

July 6, 2021 12:20 am

Stock photo from Getty Images.

Last Monday, members of the Ohio House and Senate finally reconciled their respective versions of the state budget, passing it with bipartisan support in both chambers. While a $1.6 billion tax cut and funding for broadband and brownfield development will make headlines, the most historic provision of this budget is likely its change to the school funding formula.

The school funding formula in Ohio is incredibly complicated. I know: I briefly worked for the legislative research group that focuses on the formula. A broad range of different factors determine how much state funding goes to each school.

It is hard to tell whether a single reform, even one as substantial as that included in this year’s state budget, will have a big impact on educational equity. What we can do, though, is look at other states’ school funding reform and see what their impacts have been.

A study conducted by leading poverty policy researchers Julien Lafortune and Jessie Rothstein of the University of California, Berkeley and Diane Schanzenbach of Northwestern University gives us some insight into the impact of this reform.

What these researchers did was examine the times state school funding reforms were put in place, seeing how schools fared before and after school funding reforms were implemented. The two outcomes of interest the economists focused on in this study were (1) increases in funding and (2) increases in student achievement.

According to the results, school funding reforms tend to lead to quick, large and long-lasting increases in funding for low-income school districts. Their findings were that not only did per-pupil funding increase on average for a decade out from the reform, but that progressivity of the funding system increased for decades into the future. The average low-income district per-pupil funding amount increased by $1,200 after reforms, $700 higher than in higher-income districts.

But spending alone is only one outcome: What does this mean for student achievement? 

No immediate effects of student achievement were found in the study. This is to be expected: While you can turn a dial and inject cash into a system, it will take more time to use that cash to improve student outcomes. The long-term results from this study, however, are more promising.

Ten years out, student achievement in low-income districts had improved so much that reforms had closed one-fifth of the gap between low-income and high-income districts. Notably, this impact is twice as large on an achievement-per-dollar basis as the impact of the Tennessee STAR experiment, a high-profile study that estimated the impact of class size on student achievement.

This means that funding equity can be twice as cost-effective as reducing class sizes at closing the achievement gap between low- and high-income districts.

Will we see these impacts in Ohio? It’s clearly too early to tell. Certainly some reforms are more effective than others and the devil can be in the details when it comes to a complex reform such as this. This study found that late-90s school funding reforms in Ohio brought considerably more resources to low-income school districts. Only proper evaluation of this reform will tell us the impact of this round of reforms.



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Rob Moore
Rob Moore

Rob Moore is the principal for Scioto Analysis, a public policy analysis firm based in Columbus. Moore has worked as an analyst in the public and nonprofit sectors and has analyzed diverse issue areas such as economic development, environment, education, and public health. He holds a Master of Public Policy from the University of California Berkeley’s Goldman School of Public Policy and a Bachelor of Arts in Philosophy from Denison University.