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Making Money Matter: Financing America's Schools
or how well they use it, will be able to overcome serious disadvantages that affect the capacity of many children to gain full benefit from what education has to offer.
Taking full account of conflicting values, wide variation in educational contexts, and strengths and limitations of existing knowledge, the Committee on Education Finance concludes that money can and should be used more effectively than it traditionally has been to make a difference in U.S. schools. To promote the achievement of a fair and productive educational system, finance decisions should be explicitly aligned with broad educational goals. In the past, finance policy focused primarily on availability of revenues or disparities in spending, and decisions were made independently of efforts to improve the educational system's performance. Although school finance policy must not ignore the continuing facts of revenue needs and spending disparities, it also should be a key component of education strategies designed to foster higher levels of learning for all students and to reduce the nexus between student achievement and family background.
To this end, the emerging concept of funding adequacy, which moves beyond the more traditional concepts of finance equity to focus attention on the sufficiency of funding for desired educational outcomes, is an important step. The concept of adequacy is useful because it shifts the focus of finance policy from revenue inputs to spending and educational outcomes and forces discussion of how much money is needed to achieve what ends. It also could drive the education system to become more productive by focusing attention on the relationship between resources and outcomes.
Applying an adequacy standard to school finance is at present an art, not a science. Misuse of the concept can be minimized if adequacy-based policies are implemented with appropriate recognition of the need for policy judgments and of the incomplete knowledge about the costs of an adequate education. Efforts to define and measure adequate funding are in their infancy. A number of technical challenges remain, including the determination of how much more it costs to educate children from disadvantaged backgrounds than those from more privileged circumstances. Beyond these, some fundamental questions about educational adequacy (such as how broad and how high the standards should be) are ultimately value judgments and are not strictly technical or mechanical issues. A key danger is that political pressures may result in specifying adequacy at so low a level as to trivialize the concept as a meaningful criterion in setting finance policy, or at so high a level that it encourages unnecessary spending. Another is that policy makers will fail to account for the higher costs of educating disadvantaged students.