Providing additional funding for education of students from low-income families is a constant factor in public education. The amount of additional funding provided may hinge on many elements, one element could include the percentage or concentration of students from low-income backgrounds in a particular school. This concept rests on the premise that the challenges of instruction of students with low-income families are compounded when students from low-income families make up a high percentage of the student-body.

The Stakeholder Group of the Study of Adequacy of Funding for Education in the State of Maryland recently heard a report on the effects of concentrations of poverty on school performance and school resource needs. The Maryland State Department of Education consultant APA Consulting presented A Review of the Literature on the Effects of Concentrations of Poverty on School Performance and School Resource Needs to the Stakeholder Group at a meeting in Annapolis. The effects of concentrations of poverty on school performance and school resource needs is one of the elements of the current school funding system that APA is evaluating as part of the State’s review of education funding adequacy required by the Bridge to Excellence in Public Schools Act of 2002.

The report, A Review of the Literature on the Effects of Concentrations of Poverty on School Performance and School Resource Needs, reviews the relevant literature related to the effects of poverty on both individual student performance and school-wide student performance. It then discusses whether there is evidence to support providing additional funding to schools with a high concentration of poverty. Regarding funding, the conversation focused around the idea of linear funding, meaning that a school would receive additional funding per-low income student, or non-linear funding, meaning that a school would receive additional funding per-low income student, and then if it has a particularly high percentage of students in poverty, additional funding to accommodate the issues associated with a high concentration of students in poverty.

Maryland’s Current Funding for Low-Income Students

Under current law, Maryland provides additional funding to schools based on the number of students in poverty, using a linear funding structure. The current formula states that for every child who qualifies as low-income, a school will receive an additional 1.1 times the funding it receives for other students. As described by the Department of Legislative Services,

Since fiscal 2004, the formula has used the number of students eligible for free and reduced-price meals instead of the number of Title I-eligible students, resulting in a higher student count. In addition, the formula uses a per pupil cost to be shared by State and local governments that is 0.97 times the per pupil funding level established in the foundation program. This funding level, when coupled with federal Title I funding and other State aid programs targeting struggling or disadvantaged students, brings the total aid per student who is eligible for free and reduced-price meals to approximately 1.1 times the per pupil foundation amount, which is the full amount of weight recommended by the adequacy study conducted for the Commission on Education Finance, Equity, and Excellence.

Study Finds that Evidence Does Not Support a Non-Linear Funding Approach

Ultimately, while the study finds a correlation between lower student achievement and student poverty, it does not find that there is evidence to support a higher rate of funding for schools with a high concentration of students in poverty. As described in the study,

The research clearly establishes that lower student achievement and other school challenges are associated with student poverty. It also provides evidence to support increased funding for low-income students. However, the research is not conclusive on whether the mechanism for this increased funding should be linear or non-linear — whether the additional per student funding for low-income students should increase as school district concentrations or low-income students increase.

Next Steps

In discussion of the report, the Stakeholder group discussed non-linear approaches to funding that would direct more funding to areas with a high concentration of students in poverty that current funding formulas. The group did not come to any general consensus on the topic in its most recent meeting. Ultimately, a change in the school funding formulas would be accomplished through legislation in Maryland’s General Assembly.

For more information, read the complete report, A Review of the Literature on the Effects of Concentrations of Poverty on School Performance and School Resource Needs.

For more information about the work of the Stakeholder Group, see our previous posts, Is Maryland Counting Its Low-Income Students Correctly?, Study Recommends School Formula Changes For Enrollment Gains, Drops, and Maryland Publishes School Size Report with Enrollment Recommendations.