disparities are acceptable provided that all districts or schools have access to at least an adequate level of funding (appropriately adjusted for the differential burdens associated with costs of educational inputs or with the mix of students served). To holders of this view, fairness relates only to the bottom end of the distribution of spending. Once the state has ensured that no district or school falls below the floor needed to provide an adequate education, it would not be deemed unfair for some schools or districts to spend more than the minimum. Indeed, enabling school districts to raise revenues in excess of those deemed to be adequate offers some potential benefits. Such behavior may induce greater local engagement with schools, and greater attention by local taxpayers to their performance, than would otherwise occur if the education system came to be viewed as a remote bureaucracy outside the sphere of influence by common citizens. It may also generate resources for education at levels that are more in line with consumer preferences, which vary across districts.

Others, however, may well take issue with the idea that funding levels could ever be adequate for all students if some districts or schools spend significantly more than other districts or schools. Moreover, a potential trade-off exists between the goal of ensuring fairness in spending levels and the deeply held values of consumer sovereignty and local control. One aspect of local control refers to control over the level of spending and the desire of local communities to make their own decisions about how much to spend on education. Here compromises will need to be made between the values of fairness and local control over spending. Another is control over how a given amount of money is spent within the school district. The magnitude of the trade-off between fairness and this second concept of local control depends in part on the extent to which any efforts by the state to ensure funding adequacy include controls over how local governments spend the money.

Further progress toward funding adequacy in spending and fairness in revenue raising will almost surely require an expanded role for states and the federal government. Only a larger state role in revenue raising can ensure that all schools and districts have sufficient funds to provide an adequate level of education, as defined through the state's political process, given the low fiscal capacity relative to educational needs of some school districts. In addition, a larger state role can reduce the potential regressivity arising from property taxation (although a shift to heavy reliance on a regressive state sales tax could offset some or all of such benefit). With respect to sources of local revenue, the property tax fares reasonably well in terms of standard criteria for evaluating taxes, although states have a clear role to play in ensuring that the local property tax is fairly administered.

There are several grounds on which a larger federal role might be justified: on the grounds of overcoming interstate disparities in spending that result from differences in state fiscal capacity; on the grounds of ensuring that all states can provide adequate funding should some national standard of adequacy be defined; or on the grounds that the federal government should take responsibility for



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