Does Title I Make the Rich Richer?

Does Title I Make the Rich Richer? Bruce D. Baker Rutgers University

Summarizing the Critique(critique of the critique) • Title I funding varies widely and irrationally across states. • Small states get too much, despite relatively low poverty, because of minimums • (yes, a problematic political payoff. But redistributing T1 aid to Vermont and Wyoming doesn’t get you very far) • Rich states get too much, because of the state spending factor • (But the state spending factor is largely offset by regional cost variation) • In general, richer states and wealthier suburban and urban centers gain at the expense of poorer (higher poverty) states and rural districts. • (Equating rural and urban poverty and the effects on educational outcomes is problematic. So too is equating a given poverty rate in NY state and in TX). • On top of all of this, states and local districts fail to distribute resources equitably to schools. • (Yes, this needs to be fixed, but it is only one piece of the larger puzzle, and many districts are unable to reshuffle their own resources given their relative position in the state system. Fixing state systems comes first!)

Poverty Distribution across the US Mixed Poverty, Urbanized Northeast & Great Lakes High Poverty, Hispanic Immigrant, Rural & Urban Southwest High Poverty, Rural Black-Belt South

Competitive Wage Variation across the US Consistently High Competitive Wage/Cost of Living Rural/Urban Variation in Competitive Wage/Cost of Living

A Second Look at Cameron and Ponderosa And the Tragic Flaw Alexandria, VA = 1.5539 14040/1.5539 = 9035 Original ratio = 2.073 CWI Adj. ratio = 1.522 Fayetteville, NC = 1.1408 6773/1.1408 = 5937

Within State Poverty Distribution High Poverty Rural Areas High Poverty Urban Core

Within State Competitive Wage Distribution Low Cost (Wage/COL) Rural Areas High Cost (Wage/COL) Urban Core

The Goal of Poverty Based Funding is to Offset Poverty Effects on Outcomes State poverty “effect” on NAEP

The relationship between poverty and outcomes varies by setting! At the same poverty rate, outcomes are lower in large cities than in many other settings! Analysis includes elementary school campus level data 2003-2007 grade 3 through 5 proficiency rates with subsidized lunch estimates conditional on year, limited English proficient concentration and special education rate

How Tragic is the Current Distribution?

Title I per Pupil and Census Poverty Title I funding per pupil positively associated with state poverty rate, but not as systematic as one might expect

Title I per Poverty Pupil and Census Poverty Small State Effect Relatively Wide Range, Negative Association with Poverty

Title I per Poverty Pupil and Census Poverty Corrected for CWI Small State Effect Narrower Range, No Association with Poverty

*p<.05 Really hideous regression model of district level T1 Aid

Regression Based Estimates of T1 per Pov. Pupil in Smaller Districts (rel to larger) Title I resources per poverty pupil are actually much higher in small districts

Regression Based Estimates of T1 per Pov. Pupil by Locale

Regression Based Estimates of Winners/Losers (Model Residuals) States with High Marginal Title I Funding Differences (excesses) States with Low Marginal Title I Funding Differences (Deficits)

To some extent, the rich are getting richer (r-squared = .17)

Which states are more deserving? And How bad are the current EFIG Equity Indicators?

Regression Based Estimates of State & Local Revenue Distributions High Spending, Progressive State High Spending, Regressive States Low Spending States

Relating Effort and Relative Adequacy State Effort & High Poverty Spending Are Associated (r = .527) Low effort, low spending states

Supplementing in NJ – Supplanting in PA Supplement effect of Title 1 aid in progressive state (NJ) Supplant effect in severely regressive state (PA)

Supplanting in Arizona Supplant effect in regressive state (AZ) Supplement effects in low spending, progressive (inconsistent) states

EFIG • 2) EFFORT FACTOR- • (A) IN GENERAL- Except as provided in subparagraph (B), the effort factor for a State shall be determined in accordance with the succeeding sentence, except that such factor shall not be less than 0.95 nor greater than 1.05. The effort factor determined under this sentence shall be a fraction the numerator of which is the product of the 3-year average per-pupil expenditure in the State multiplied by the 3-year average per capita income in the United States and the denominator of which is the product of the 3-year average per capita income in such State multiplied by the 3-year average per-pupil expenditure in the United States.

EFIG • (I) IN GENERAL- For each State, the Secretary shall compute a weighted coefficient of variation for the per-pupil expenditures of local educational agencies in accordance with subclauses (II), (III), and (IV). • (II) VARIATION- In computing coefficients of variation, the Secretary shall weigh the variation between per-pupil expenditures in each local educational agency and the average per-pupil expenditures in the State according to the number of pupils served by the local educational agency. • (III) NUMBER OF PUPILS- In determining the number of pupils under this paragraph served by each local educational agency and in each State, the Secretary shall multiply the number of children counted under section 1124(c) by a factor of 1.4. • (IV) ENROLLMENT REQUIREMENT- In computing coefficients of variation, the Secretary shall include only those local educational agencies with an enrollment of more than 200 students.

Current Federal Equity Indicators Unrelated to “Progressiveness” Inequitable Equitable Progressive Regressive

Current Federal Equity Indicators Unrelated to Relative Adequacy Inequitable Equitable Low Revenue High Revenue

Is there a better way?

Baseline Model Estimates Should Receive T1 Decrease Should Receive T1 Increase

Baseline Model Estimates with Effort Adjustment Should Receive T1 Decrease Effort Bonus for NJ Effort Penalty for LA Should Receive T1 Increase

Baseline Model Estimates with NAEP Deficit Adjustment Should Receive T1 Decrease Should Receive T1 Increase

Conclusions/Implications • Regression based estimates, controlling for (a) scale, (b) locale, (c) wage variation and (d) poverty may be useful for driving Title I aid. • Additional “effort” and “performance” factors produce subtle shifts. • Need to find better way to evaluate relative poverty and poverty effect on outcomes • Double edged sword - ideally, progressive states can offset poverty effect on outcomes • On average, Title I really isn’t making the rich richer • How to pressure low effort and/or regressive states to start doing the right thing, without further penalizing their kids. • Current EFIG Federal Equity Indicators relatively useless. • Quite simply, Louisiana would appear to care less. 17% of LA children attend private school (2nd to Delaware, which also cares less). • Arizona has no interest in aiding children in poverty or LEP children and ranks 46th in adjusted spending.

Does Title I Make the Rich Richer?