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Study Finds State School Finance Reforms Narrowed Income Gaps but Increased Racial Funding Inequities

Authors urge federal action to target disparities that persist beyond state-level fixes.

Overview

  • The peer-reviewed analysis by Emily Rauscher of Brown University and Jeremy E. Fiel of Rice University covers 1990 to 2022 using U.S. Census and NCES data.
  • Reforms reduced spending gaps between the highest- and lowest-income districts by more than $1,300 per pupil on average.
  • Districts with lower shares of Black and Hispanic students gained additional per-pupil spending advantages of about $900 and $1,000, respectively.
  • Outcomes differed by segregation, with improvements in less segregated states and regressive or ineffective results where racial and economic segregation is high.
  • The authors report that much of the racial funding inequality lies between states with differing wealth, leading them to call for federally targeted investments.