Promoting higher achievement for all students in a cost-efficient way poses fundamental challenges for the education system and will require significant changes in education finance. Among the finance options to be explored in this chapter are placing greater emphasis on the concept of educational adequacy; investing in the capacity of the system, particularly through improved professional development of teachers; changing incentives for teachers and other key participants to focus more on student achievement through new salary structures and accountability systems; and significant restructuring to give more authority over spending to schools and to parents. No single strategy or policy option is a panacea, all involve trade-offs of various types, and some of the strategies or individual options are likely to be most effective if combined with other strategies or policy options. Instead of laying out a blueprint for specific change, our aim in this chapter is to provide policy makers with information that will allow them to weigh the benefits and costs of each policy option.
As applied in school finance court cases for the past 30 years, equity concerns typically apply to the distribution of funding across districts. Equity defined in this way—but extended to the patterns of funding across schools and across states—continues to be an important concern that we address further in connection with goal 3, raising revenues fairly and efficiently. However, a con-