Study: Pa. school-funding reform plan a failure

HARRISBURG - A state effort to target funding to lagging school districts did not reduce student achievement and per-student spending disparities, a recent study says.

Under the plan, which is no longer in effect, the state sent additional money to school districts that were spending less than what a formula determined was adequate for a district with its number of students and level of poverty, among other factors. The planned six-year program ended after three years.

Researchers at the University of Pennsylvania and Georgia State University concluded in a National Tax Journal study published earlier this month that the payments Pennsylvania sent to these districts did not reduce the gaps in spending or student achievement that separate wealthy and poorer districts.

The study has drawn scrutiny from some observers of the state's education funding system, who questioned aspects of its conclusions.

The research found that districts that received the most money under the 2008 plan - generally poorer school districts - on average decreased their "property tax effort" - calculated using a formula that divides taxes collected by a district by market value of taxable property - compared with that of wealthier districts so that the gap in education spending by poor and wealthy districts did not shrink.

"This is equalization aid," said Matthew Steinberg, an assistant professor at the University of Pennsylvania's Graduate School of Education and the study's lead author, in an interview. "The whole purpose of equalization aid is to equalize spending, and that's not at all what happened."

The study notes that the payments in question were a relatively small component of basic education funding, the main K-12 line in the state budget. The payments came to an average of $236 per student in the first year, and $479 per student in the third year, the researchers found.

The paper's contention that the high-tax school districts with spending shortfalls reduced their property tax efforts more than districts without spending shortfalls drew criticism from some education funding experts.

Michael Churchill, an attorney with the Public Interest Law Center, said that the study's references to "property tax relief" are misleading. Of the 92 high-taxing but underfunded districts in the study, only seven lowered their tax rates during the period of the funding law, he said, although the measure of tax effort decreased as the market value of property increased.

Churchill said that per-student spending increased in the great majority of those districts, and that math and reading scores also increased in large majorities. (Performance in the more well-off districts also improved, he said, as those districts increased their local contributions to education funding.)

"To imply that the state funding reforms didn't work is utterly wrong," he said. "In the absence of those increases in state funding, you would have expected a relative decline in funding by the poor districts and a decline in achievement."

Steinberg said the research compared changes in spending between the districts with spending shortfalls and those without shortfalls, and does not claim there was no spending increase for a particular group of districts over the time of the study.

Mark Price, a labor economist at the liberal Keystone Research Center, said that the findings were not described carefully in the paper, and that legislators might understand it to say that property tax rates fell in high-tax shortfall districts, when instead, he said, three out of four of those districts raised property tax rates over the period by an average of 9.8 percent.

But he said the paper offers an insight.

"A reasonable policy conclusion from the paper is that efforts to close the achievement gap between school districts by boosting state funding should generally aim for school districts to maintain their existing tax effort so as to insure that increased state aid goes into the classroom," he said in an email.

Donna Cooper, who served as secretary of policy and planning for Gov. Ed Rendell, said too little additional money was distributed to assess the plan's effects.

"The amount of funding that was distributed to school districts in those years could never have closed in any significant way the disparity or achievement gap," she said.

Steinberg, the lead author, sounded a similar note.

"Our paper points to the reality that the modest per-pupil aid that was provided to shortfall districts via [the law] was simply insufficient to make meaningful changes to the spending and educational circumstances of what are disadvantaged, largely minority-serving school districts," he said.

Republicans in the state House saw it differently. Spokesman Steve Miskin said in an email that the study appeared to highlight that Rendell's approach to education funding did not work.

"The overall point should not be about more spending, or more money, but about getting the best educational performance results," he said.

klangley@post-gazette.com 717-787-2141