School funding--what's enough? determining exactly what is needed to do a good job teaching our children continues to be elusive. But there are some ideas that may help.

• Author: Smith, Steve

It's the newest wrinkle in a decades-old debate. Schools, in order to educate kids, need an idea of what a good education is and enough money to pay for it. The process of getting there can be "a nightmare," says Ohio Senate President Richard Finan, whose state has been involved in an 11-year lawsuit. Just when you think you know the rules, they change.

Welcome to the world of education finance.

As a nation, we spend about $350 billion on K-12 education every year, making it the largest budget item in most states. But revenue structures, distribution systems and other methods used to fund education are often complex and hard to understand. The movement toward "adequacy" has only added to the confusion.

In plain terms, an adequate level of funding provides students with the opportunity to achieve education goals, such as completing high school, being prepared to compete in the global economy and participating in a democratic society.

Over the past 15 years, states have identified numerous education standards, but most have not linked them to their education finance systems. "In the standards-based reform movement, the states' role is to define performance goals, measure whether students are meeting them, and hold school districts, schools and students accountable for results. One major assumption within this framework is that sufficient or 'adequate' resources will be provided so that schools and students can succeed," says John Augenblick, an education consultant based in Denver, who has helped several states link education standards and finance. Ways of determining adequate levels of funding are relatively new, but there is a growing interest in coordinating education standards with education finance.

COURTS SHAPE EDUCATION FINANCE

Over the past three decades, state courts have played a significant role in shaping education finance policy. Legal challenges to finance formulas have been brought in 44 of the 50 states since 1971.

Many of the early cases centered on issues related to "equity." Equity refers to funding all students in a state in a somewhat equal manner. Building on the Brown vs. Board of Education case in 1954 and the civil rights acts of the 1960s, plaintiffs successfully argued that the amount of money spent on a child's education should not be determined by how wealthy their parents are or where the child lives.

In response, many states changed the way they funded education and created more equitable systems. "Over the past 30 years there is no question that education funding has become more equitable. The question now is whether we have 'equity of poverty.' Just because everyone is receiving the same amount of money does not necessarily mean that the level is appropriate," says Craig Wood of the University of Florida, who has defended numerous states in school finance litigation cases.

Early adequacy cases were based on education clauses, found in all state constitutions, requiring the state to provide an education system for its children. In the early 1970s, plaintiffs in New Jersey and Washington said the states were not providing enough money for an adequate education and, therefore, were not meeting their constitutional responsibilities. The West Virginia Supreme Court took adequacy a step further in 1979 and identified a set of broad goals for the education system.

In these cases, although the state may have established goals beyond constitutional language, there was no way to know if they were being met. In the 1970s and most of the 1980s, it was very difficult to determine if states were providing an adequate...