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Summer 2008 Vol. 15. No. 4 Focus on Following the Money

Theme articles

Looking to divide the pie more fairly

New CEO wants to distribute school funds through a "weighted student funding" system.

By by Dale Mezzacappa
Photo: Harvey Finkle

Incoming CEO Arlene Ackerman, talking here with Masterman sophmore Dan Jones, endorsed student calls for more openness in District dealings at a Philadelphia Student Union rally outside District headquarters April 24.

Incoming School District CEO Arlene Ackerman comes to the Philadelphia School District determined to adopt a new system for distributing funds to schools that could significantly redirect resources to high-poverty areas and give parents, teachers, and principals more say over how money is spent.

The system, called “weighted student funding,” or “weighted student formula,” would also bring more transparency to the District’s budget, which one national school finance expert has called “the worst” she’s ever seen – a mishmash of numbers that make it difficult to track school-by-school and program-by-program spending.

Also sometimes called “fund the child,” a weighted student formula assigns a dollar value to each child based on circumstances including poverty, lack of proficiency in English, and other educational needs.

“It determine[s] how you are going to allocate funds in an equitable way to schools based on specific student characteristics,” Ackerman said in an interview.

Students with more needs have more money follow them, whatever school they attend. What characteristics to include in the formula and how much weight to give each would be decided in an open process involving parents, teachers, principals, and community members.

“It’s important as a way to address equity and bring more openness and participation to the budget process,” said Ackerman.

She said she plans to start holding community meetings about the process in the fall.

Weighted student funding has supporters who span the political spectrum, from free-marketers who see it as a step towards more choice to community organizers who see it as a way to pump up budgets in the neediest, most poverty-stricken schools.

But critics say that it doesn’t work when budgets are tight or shrinking and schools wind up fighting in a “robbing Peter to pay Paul” scenario. And budgets are tight in Philadelphia, which is facing cuts due to a projected $39 million shortfall in the 2008-09 budget.

However, Ackerman thinks that adopting weighted student funding could help address the shortfall, making it more likely that state legislators and City Council will consider sending more money to the District “if they are convinced we’re distributing the dollars we have more equitably.”

Ackerman is a pioneer of this approach, having helped implement a version of it in her three previous districts: Seattle, the first U.S. district to embrace it, Washington, DC, and San Francisco.

In one form or another, it is also used in such districts as Houston, New York City, Cincinnati, and Oakland, CA.

It discards long-standing methods for allocating staff and resources to schools that appear neutral, but tend to favor better-off schools. Laden with complexity and political minefields, however, it has been relatively slow to catch on across the country.

Resources follow need

“The key idea is that similar kids are funded similarly,” said Joseph Olchefske, the former superintendent in Seattle and now a consultant working on school budgets for the American Institutes for Research. “If part of your philosophy is that resources follow the kids based on need, then you put more resources where the need is higher.”

He added that the process, “is far more than budget reform; it’s a way of organizing the district and thinking about decision-making and equity. It raises a lot of issues that need lots of discussion.”

Currently, Philadelphia, like most districts, uses a “staff-based” method for distributing the bulk of its resources, allocating a certain number of teachers to each school based on total enrollment. Since 1994, Philadelphia has given schools flexibility in the use of another portion of budgeted funds – also based on the number of students and called “discretionary funds” – from which a principal pays for administrative and other staff, supplies, and extra services.

Implementing weighted student funding in Philadelphia would transform the often-inscrutable budgeting process, which is fraught with anachronisms and built-in inequities.

“Discretionary funds,” for instance, are calculated on a per-student basis and differ by grade level. But while K-8 schools are allotted only $310 for each seventh or eighth grader, middle schools get $856.

“If ever there was a district that needed someone to come in and clean up the finances, Philadelphia is it,” said Marguerite Roza, a professor at the University of Washington and national expert on school budgets who analyzed the District’s finances in 2006 for former Mayor Street’s education advisory panel. “It’s the worst I’ve ever seen…. Nobody knew where the money went.”

A national consulting firm, Education Resource Strategies, is analyzing how money is spent in schools here, Ackerman said.

Traditional staff-based budgeting, according to Ackerman, is inherently inequitable because it assumes that “all schools are alike. But all schools are not alike, they don’t have the same population and the same needs.”

The traditional system also allows savvy principals and parent groups to advocate for add-ons – more AP courses, extra counselors, specialized programs – that further skew the imbalance, Ackerman said. “We already spend more at certain schools with no rationale why we’re doing it,” she said. “The process is not transparent. Schools that don’t have a principal or parent community who can articulate the needs don’t get those extras.”

About the Author

Contact Notebook contributing editor Dale Mezzacappa.

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