Should School Districts Be Too Small to Fail?

When an individual gets financial support from the government, we call it an “entitlement.” When a large business gets tax breaks, we call it “corporate welfare.” However, when a small school district cannot afford to keep its doors open without significant support from the state, we call it an “issue of local control.”

Right now, there are 191 districts with 350 or fewer students enrolled. These districts get less than half of their funding from local sources, 46 percent on average. The rest comes from state (44 percent) and federal (10 percent) sources. The smallest district in the state, Gorin R-III, for example, has just 19 students enrolled. The district raises just 38 percent of operating expenditures locally, while 54 percent comes from the state. Then there is Plainview R-VIII, enrollment 81. With the low tax rate of just $2.9123 per $100 of assessed valuation, Plainview raises just 28 percent of the operating funds locally, while 63 percent comes from the state. In all, 141 of the small districts receive less than half of their funding for operating expenses from local sources.

These districts are able to exist because of generous state support. Specifically, the state legislature sets aside $15 million for school districts with fewer than 350 students. This is in addition to the funding that comes through the state’s foundation formula for K-12 public schools.

In my last post, I discussed House Bill 1292 and asked if school consolidation was an issue of local control. I received a couple of comments that said it was. Maybe they are right. Maybe it should be a local decision to join with a neighboring district. Whether these small districts should receive additional state funding, however, is not an issue of local control. It is an issue that all taxpayers and all state policymakers should have a say in.

Should school districts be too small to fail? That is, do small school districts deserve extra financial support because they may close if they do not receive extra funding?

I am completely sympathetic to arguments of local control. However, I’m concerned too many claim local control only when it suits them. It certainly seems contradictory to claim sovereignty, while going hat in hand to state taxpayers for additional funds.