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Abstract
Journal of Official Statistics, Vol.18, No.3, 2002. pp. 465480

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Federal Formula Allocation For Schools: Historical Perspective and Lessons from New York State

Abstract:
This article offers a practitioner’s perspective on education funding through school aid formulas. State school aid formulas in New York State have tended to evolve through a process of incremental change characterized by slow growth, punctuated by occasional reforms. Many of the current formulas are designed to drive aid to districts according to their levels of student need and fiscal capacity. Such targeting efforts depend, however, on the State’s ability to gather and analyze complex data. Abstract concepts such as student need and district wealth need to become measurable variables in order to drive funding. Debates about acceptable proxy measures for these important concepts mean that, even when we agree on policy goals, the means of achieving those goals remains an issue.

Other debates result from conflicting policy goals. Targeting aid to student need conflicts at times with the goal of providing stability and predictability in year-to-year funding levels. With competing goals and inherent uncertainties in the operationalization of variables that drive billions of dollars in school aid, it is hardly surprising that education finance is complex and often contentious. Finally, school aid funding has raised questions about intergovernmental relations and the appropriate roles of federal, state, and local governments in providing resources for K-12 education. This article will examine the evolution of education funding in New York State by offering a brief history of New York State’s school aid formulas. The article concludes by drawing implications for federal funding formulas from this state perspective.

Before beginning, a brief description of the governance of education in New York State will help to distinguish this from other states. Budget authority for educational aid in New York rests with the legislature and the executive branch, as it does in other states. The New York State Board of Regents is the policymaking body for all educational institutions in the State and the State Education Department. Members of the Board are appointed by a joint session of the Legislature. The Regents can take positions on the impact of aid distributions and make aid proposals independent of the executive and legislative branches. Although the regents have been influential in aid deliberations their relationship is advisory in nature.

Keywords:
School finance; school reform; federal funding for schools; education policy; state aid to school districts; NYS education.

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