What’s So Great about Performance Districts?

The state of Missouri provides almost half of the funding for public education (the rest comes from the federal government and local effort). In its latest budget request for Fiscal Year (FY) 2026, the Department of Elementary and Secondary Education (DESE) has requested almost $10 billion. With a new governor set to take office, it might be wise to dig into some of the details of this request.

This year’s request includes an increase of nearly $350 million for the Foundation Formula, due to an increase in the base amount that the state considers “adequate” to educate a child. This amount had been $6,375 for four years, from FY 2020 through FY 2024. The FY 2025 budget included a request to increase the amount to $7,145, phased in over two years. Why the increase? Well, that’s a bit confusing. Please follow along.

Technically, the amount reflects the current expenditures per student in Missouri’s highest-performing districts, referred to as Performance Districts. The thinking is that what these districts spent should be adequate. But what does it take to be a Performance District?

The way the law has been interpreted is that Performance Districts are those that receive at least 90 percent of possible points on their Annual Performance Report (APR) under Missouri’s accountability system, after removing the outliers at the top and bottom of the list. The accountability system, also known as MSIP 6, gives districts points based on a rubric of items considered important to DESE and the state Board of Education—although some items are only loosely related to performance.

For example, districts can earn up to 52 points for attendance, having 8th graders fill out an Individual Career and Academic Plan, administering a Kindergarten Entry Assessment to incoming kindergartners, submitting their required financial reports on time, conducting a Climate and Culture Survey, and submitting a Continuous Improvement Plan. All 28 of the Performance Districts received 52 out of 52 points in these categories. Eight of the districts had only 114 possible points—so there’s almost half of them.

One of the Performance Districts was Gasconade C-4, a rural K-8 district with just 100 students. Last year, 37 percent of its students performed on grade level in English/language arts (ELA) and 27 percent did so in math—both below statewide averages. Another Performance District, Hudson R-IX, with just 39 students in grades K-8, had only one in four students on grade level in ELA and just three in ten in math. Mind you, this district has fewer than 10 students per grade.

The problem is that weak accountability systems reward weak performance. In the case of Missouri, that consequence bleeds over to funding. More than half of the Performance Districts are very small, with fewer than 300 students in the entire district. Spending tends to be higher in these districts because there are few economies of scale. That higher spending leads to hundreds of more dollars for all 850,000 students in the state and adds up to almost $350 million in state spending.

Are we sure this is the best system we can come up with?