Because of the pandemic, many states will likely need to determine how they can best address shrinking revenues with the least harm to students, even as the needs of students have increased and the crisis has exposed gaping disparities. As such, states can consider the following principles so that any K-12 funding cuts are equitable for vulnerable students in high-need schools and districts, student-centered and strategic, while encouraging districts to act similarly. This diagnostic tool includes details on the importance of each principle, with guided questions each state can use to assess how well it is implementing each principle.

For State Leaders: Overview of the Principles

As your state determines how it can best address shrinking revenues with the least harm to students, it can do everything possible to avoid making cuts to education budgets at all or, at the very least, make cuts that are not disproportionate to other parts of the budget. If education cuts must be made, your state can consider the following principles to ensure that any K-12 funding cuts are equitable, student-centered and strategic, while encouraging districts to act similarly.

General

1. Avoid any cuts to K-12 funding; if cuts are unavoidable, make them temporary and less severe than for other parts of the budget.
2. Be transparent and involve all potentially impacted stakeholders to the fullest extent possible; require similar transparency and stakeholder engagement by districts.



Equity

3. Avoid across-the-board cuts and other approaches that disproportionately harm high-need districts, cutting first any funding that works at odds with equity in the funding formula and protecting targeted funding that supports vulnerable students.
4. Require districts to track and publicly report in a timely manner whether budget and staffing cuts are disproportionately impacting high-need schools; prohibit districts from cutting budgets in a way that creates a systemic and disproportionate impact on high-need schools as compared to other schools in the same district; when reducing staffing or enacting hiring freezes, require districts to consider impact on high-need schools and vulnerable students, teacher diversity and teacher effectiveness.



Student-Centered

5. Simplify the state funding system into one student-based formula with a base amount for each student plus additional amounts or weights for vulnerable students; ensure that vulnerable students are not unfairly hurt because of COVID-19, while promoting high-quality online and hybrid instruction.
6. Ensure funds are flexible, temporarily removing unnecessary restrictions on state and federal funding, paired with increased accountability and requirements that resources dedicated for vulnerable students actually reach those students; minimize widespread and permanent staffing cuts by giving districts the flexibility to use temporary salary reductions and furloughs and modifications to traditional staffing responsibilities and structures.
7. Do not disproportionately impact students because they attend a traditional public school or public charter school.



Strategic

8. Provide districts with specific information about the magnitude and timing of potential funding cuts as soon as possible; encourage districts to plan ahead with conservative budgets and temporary delays in expenses to avoid more harmful cuts in the future.
9. Prioritize funding for state programs that are a critical part of a coherent, evidence-based state improvement strategy or address urgent health, safety and social emotional needs; support districts in placing the impact on students at the forefront of budget cutting decisions.
10. To offset state K-12 funding cuts, maximize availability of federal revenues and direct other state agencies to prioritize support for schools and students.

Principles and Guided Questions

For each of the principles, explanations and guided questions are provided to help state policymakers and partners determine which of the principles merit further exploration given the unique circumstances of each state. A score sheet on the last page assigns points for answers to the questions so that you can tally your results for each principle and assess whether further actions are needed.

General

K-12 education is one of a state’s most critical functions, and as such, it should be protected even in fiscally tight times. If cuts for K-12 are necessary, states can mitigate harm to students through a transparent budget process that involves key stakeholders.

1. Avoid any cuts to K-12 funding; if cuts are unavoidable, make them temporary and less severe than for other parts of the budget.

States can demonstrate their commitment to K-12 education by avoiding budget cuts unless they are necessary. If unavoidable, the cuts can be temporary and less severe than for other parts of the budget.

2. Be transparent and involve all potentially impacted stakeholders to the fullest extent possible; require similar transparency and stakeholder engagement by districts.

States can make the best decisions about where to cut K-12 funding by having a transparent process that involves key stakeholders to the fullest extent possible, and they can require districts to act similarly.

Equity

Vulnerable students are already suffering the most from COVID-19, with deeper learning loss and more trauma. These students are often in districts that are have the least resources and depend the most on state funding. If your state wants to address the needs of vulnerable students, the state can ensure that these students are not disproportionately harmed by state funding cuts.

3. Avoid across-the-board cuts and other approaches that disproportionately harm high-need districts, cutting first any funding that works at odds with equity in the funding formula and protecting targeted funding that supports vulnerable students.

When faced with significant revenue drops, states historically have used across-the-board cuts or other approaches that disproportionately impact high-need districts. As a result of the pandemic, students in these districts have already suffered the most harm from COVID-19, including substantial learning loss and trauma, and these districts have the least local resources to make up for state funding cuts. As such, states that want to mitigate harm to vulnerable students can consider approaches that look at the funding cut per student and make sure they are lowest in high-need districts.

Many states have specific funding program to address the needs of vulnerable students. If forced to make K-12 funding cuts, states that want to mitigate harm to vulnerable students can protect these targeted programs and instead look first at programs that disproportionately benefit the least needy schools and districts, including providing more funding to wealthier districts because they can afford to pay their teachers higher salaries.

4. Require districts to track and publicly report in a timely manner whether budget and staffing cuts are disproportionately impacting high-need schools; prohibit districts from cutting budgets in a way that creates a systemic and disproportionate impact on high-need schools as compared to other schools in the same district; when reducing staffing or enacting hiring freezes, require districts to consider impact on high-need schools and vulnerable students, teacher diversity and teacher effectiveness.

As districts make cuts in response to state funding decreases, it is important to understand the impact on high-need schools, both in terms of how much money these schools are losing and whether these schools are disproportionately losing effective teachers. When faced with state funding cuts, districts will have to make tough budget decisions, and vulnerable students may suffer disproportionately, as they and their families lack the political power of other interests.

Districts often cut staffing using seniority or last-in first-out (LIFO). More difficult-to-staff schools often serve vulnerable students and have less experienced teachers. Even if the districts shift more experienced teachers into the difficult-to-staff schools, the churn alone can impact learning outcomes for students. Also, many teachers of color were recently recruited into the field, and a LIFO approach will likely result in the loss of teachers of color, who are particularly beneficial for students of color. An additional challenge is that many bargaining unit contracts require LIFO.

To protect vulnerable students, states can require that district cuts in resources, including funding and staffing, are lower in high-need schools than other schools in the same district and to consider factors beyond seniority when making staffing cuts over the next year or two.

Student-Centered

If your state is going to provide less funding for K-12 education, it can help districts make the most use of existing resources by increasing their flexibility by collapsing the multitude of funding programs into a core formula that is student-centered, where each district is provided a base amount for each student it serves and substantial additional funding for vulnerable students. Your state can then hold districts more accountable for student learning.

5. Simplify the state funding system into one student-based formula with a base amount for each student plus additional amounts or weights for vulnerable students; ensure that vulnerable students are not unfairly hurt because of COVID-19, while promoting high-quality online and hybrid instruction.

If states have to cut K-12 funding, they can mitigate harm to students by maximizing district flexibility in using the reduced resources they have. States can do this by collapsing their multitude of different funding programs into a student-based formula with a base amount for each student plus additional amounts or weights for vulnerable students. Student-centered funding is more equitable; it empowers districts, and it maximizes the ability of parents to choose the school best for their children.

A central feature of student-centered funding is that districts receive funding based on the number of students they serve. Funding follows the student so that districts have the resources to serve more students when needed. This contrasts with funding that uses older enrollment data or does not adjust for enrollment at all.

Under COVID-19, many districts have seen decreases in student enrollment. States are often holding districts harmless, using enrollment from previous years. This avoids penalizing districts that have vulnerable students facing difficulty accessing online instruction. However, this provides no incentive for districts to engage their students or provide high-quality online or hybrid instruction.

6. Ensure funds are flexible, temporarily removing unnecessary restrictions on state and federal funding, paired with increased accountability and requirements that resources dedicated for vulnerable students actually reach those students; minimize widespread and permanent staffing cuts by giving districts the flexibility to use temporary salary reductions and furloughs and modifications to traditional staffing responsibilities and structures.

When faced with state funding cuts, districts can mitigate harm to students if states temporarily provide more flexibility on using the limited resources available while still ensuring that vulnerable students get the additional resources the state is providing to districts for these students.

Many districts may be continuously switching between in-person, hybrid and remote learning environments throughout the school year. The staff that are needed in each of these instructional models differ. Instead of making permanent staffing cuts, your state can enable districts to modify contracts, adjust the responsibilities of staff and better match the staff they critically need in each of the learning environments.

Districts are also seeing an increased need for instruction, tutoring and counseling to make up for learning loss and to support mental health needs, but they may not have the funding to provide the additional support, particularly if your state has to cut K-12 funding. Indeed, since it is unlikely that districts will need to sustain an increased tutoring or counseling load in the long term, many districts will be reluctant to hire permanent staff to provide additional support. Instead, your state can help districts find temporary or short-term support to address current needs in instruction, tutoring and counseling without a long-term obligation to support the increased staffing load once the need decreases. By allowing districts to temporarily employ non-traditional staff or adjust their staffing structures, your state can help districts more cost-effectively address their increasing needs despite reduced resources.

7. Do not disproportionately impact students because they attend a traditional public school or public charter school.

As states consider funding cuts, it is critical to treat all students equitably and not discriminate between traditional public schools and public charter schools. Indeed, many parents are exploring alternatives during periods of online and hybrid instruction. Your state can ensure that these parents can choose the public school that is best for their children by equitably funding all types of public schools.

Strategic

Your state can mitigate the harm of funding cuts by prioritizing the most cost-effective state programs and giving districts the time to make thoughtful decisions about making budget cuts. This is different than across-the-board cuts or cutting the newest programs.

8. Provide districts with specific information about the magnitude and timing of potential funding cuts as soon as possible; encourage districts to plan ahead with conservative budgets and temporary delays in expenses to avoid more harmful cuts in the future.

Last-minute and mid-year district budget cuts are particularly devastating to students, as districts have fewer options on what they can cut. It is far better for districts to have time to plan for cuts for the next school year. States can help by letting districts know about potential cuts as soon as possible.

Many districts are unclear on how long the COVID-19 era financial shortfalls will continue. They may think it is a short-term problem and will put a band-aid on their current budget by digging into Rainy Day funds or using one-time federal funds to continue with the status quo. Indeed, many districts may continue to provide cost-of-living-adjustments (COLAs), increase salaries based on experience and educational degrees (step-and-lane) and enhance employee benefits. This raises the risk of a financial crash the following year. States can help provide districts the cover they need to make painful decisions now that avoid even worse decisions in the future.

9. Prioritize funding for state programs that are a critical part of a coherent, evidence-based state improvement strategy or address urgent health, safety and social emotional needs; support districts in placing the impact on students at the forefront of budget cutting decisions.

As states determine what funding to maintain or to scale back to address budget cuts, there are two critical questions worth asking. First, is a specific funding program part of a coherent, evidence-based improvement strategy? States can protect strategic priorities, including early literacy and addressing urgent health, safety and emotional needs caused by COVID-19. However, a standalone program is much less effective than one that is part of a coherent strategy.

Second, does the program have a high academic return on investment (A-ROI) or reflect well-vetted research? The ultimate purpose of driving funding decisions through A-ROI analyses is to maintain programs that are based on evidence of effectiveness rather than gut feelings. An A-ROI analysis considers program costs, including staff time, and the impact these costs have on students with different educational needs.

If your state does not have the data to conduct an A-ROI analysis, the state can turn to well-vetted research to drive funding priorities. Using research such as the What Works Clearinghouse, your state can invest in the practices that have been proven to work elsewhere. Without prioritizing A-ROI data or best practice research, your state may unnecessarily maintain funding for programs that do not significantly impact students or even make across-the-board cuts that take away from effective programming.

Districts face similar challenges when they are making tough budget cuts. They can mitigate harm to students by identifying the programs that are not part of a coherent, evidence-based improvement strategy or do not have a high A-ROI. Many districts lack this information or the capacity to determine it, and they gravitate to across-the-board funding cuts. Your state can build the capacity of districts to make budget decisions more strategically based on impact on students.

10. To offset state K-12 funding cuts, maximize availability of federal revenues and direct other state agencies to prioritize support for schools and students.

If your state is forced to cut K-12 funding, it can mitigate harm to students by maximizing the availability of federal and other state funds.