California School Finance -- Why School Finance Matters

Commentary by Peter Schrag

School Finance is the Key to the Whole Enterprise
March 15, 2007

Because the state is now the major funder of local public schools in California, state leaders determine curricula, graduation requirements, textbooks, teacher qualifications, and a wide range of other educational fundamentals. In that respect, finance -- what's funded, what's not -- is key to the whole school enterprise.

School finance policies obviously also matter greatly to the countless interest groups whose programs and budgets depend on them -- from the unions to the charter school groups to the bilingual advocates. (Yes, there still is a bilingual lobby). At the same time, because so much of school funding is based on mandatory formulas, from Proposition 98 to the long list of categoricals, all subject to the ideological alignments of the state's parties and the political struggles of those interest groups, virtually no attention has been paid to the effectiveness of the state's school budget items.

Does class size reduction, for example, pay off in terms of achievement, or only in satisfying the wishes of teachers and parents? What's the trade-off between smaller classes and higher pay combined with greater support for teachers? Do advanced degrees and/or additional college course work for teachers, without any other conditions, increase teacher competence and effectiveness? We create fiscal incentives for teachers to get degrees, and many respond, but do these incentives for better performance really pay?

And, of course, finance policies should matter to children and to the general society in its ability to drive educational practice and enhance (or impede) the chances for success. Presumably with properly targeted incentives and with finance policies that encourage the retention of high performing teachers and the attrition of weak teachers, the system could be upgraded. Such incentives can obviously be influenced by how schools are funded. If additional resources were concentrated on the schools and children most in need of additional help, could those schools develop the capacity to improve?

The difficulty, as suggested above, is that California has no consistent financial policy. When revenues go up, the state spends more and spends it in roughly the same proportions as all other funds -- and almost inevitably without any strategic policy priorities. When revenues go down, cuts are made in the same manner, with little reference to what's been, or might be, successful. All of this says that for the most part -- at least now -- the state has used its vast fiscal power almost blindly.

The reports on adequacy and efficiency now being published by the Getting Down to Facts project are the first major attempt to remove some of those blinders. That shouldn’t mean that classroom practice should or can be dictated from Sacramento, but a good evaluation of effectiveness may tell a lot more about what's best mandated as policy and what's best left to the professionals in the schools and classrooms. The apportionment of responsibilities has itself been left too much to the buffering of the political process.

It's often a very long way from the intentions of policy makers to what goes on in the mind of the child in the classroom -- far longer than politicians or boards of education can imagine. Which is to say that even the best devised policy may be only marginally effective. Education is not science. It's a highly complicated process conditioned by a lot of things outside the control of schools, teachers, or those who would direct their work and who think that any vote in the legislature will automatically reverberate in that classroom. But in a democracy no school reform can ever be implemented without reference to the fiscal policies that, if done well, can shape those schools and influence those who run them.

See commentary by Lawrence O. Picus