The Illusory Goal of a Fully Funded K-12 Formula

If you’ve ever seen it, there is something funny about a dog chasing a car. At first it seems as if the dog may grab hold of a tire, but inevitably, right when the dog is about to catch it, the car speeds up, leaving the dog behind. Bless poor Fido’s heart, but it is an exercise in futility. In many ways, funding for Missouri’s public schools is the same way—just when you think you can catch it, it accelerates out of reach.

It’s hard to read a story about education in Missouri without seeing that public schools are “underfunded.” What they are really saying is the legislature is not fully funding the formula that determines how much each school is supposed to receive—the Foundation Formula. Some suggest the shortfall comes from the economic downturn of a few years ago. Others say taxes aren’t high enough to generate sufficient revenue to fully fund the formula. Both theories imply something is wrong with the dog—either he’s too sluggish, or we aren’t feeding him enough.

Here is another explanation: Fully funding the formula is difficult because the funding formula continues stepping on the gas.

The Foundation Formula is designed to continually increase. How much schools should receive from the state is determined by something called the “state adequacy target.” The target is recalculated bi-annually and, by law, can never go down.

Now, follow me here for a minute. The target is based on how much Missouri’s successful school districts spend per pupil. Setting aside whether that is a good idea in and of itself, let’s imagine the legislature appropriates an extra $400 million dollars to the funding formula. What would happen to spending in these districts? It would go up, of course. Subsequently, when the state adequacy target is recalculated the target would go up again. . . and so on.

We already see this happening. From the 2015-16 school year to the 2016-17 school year, the state adequacy target will increase $230 per student. The goal of fully funding public schools just went up another $203 million.

Despite the continually growing requirements of the formula, the state does not adjust “local effort”—the amount the state expects districts to raise locally. Right now, the Department of Elementary and Secondary Education uses assessed property values that are over a decade old. Property values, and taxes, have gone up in the meantime. Yet, the formula doesn’t capture these changes.

Try as they might, lawmakers will have a tough time ever fully funding the system, because the very act of increasing funding leads to the requirement of another increase in the formula amount for the next year. Just like Fido, they’ll always be looking into an exhaust pipe.

This isn’t to say that Missouri should or should not spend more on K-12 education. Rather, these illustrations demonstrate the need to restructure the formula so it is more dynamic and attuned to the changing demographics of school districts.