To Set Up All Children for Success, Maryland Must Reform Education Funding

Maryland’s public school system is failing too many of its students because our investments in education have not kept up with what schools need to provide all students a great education. Fortunately, we now have a once-in-a-generation opportunity to make effective reforms that benefit Maryland children and our economy for many years to come.

As the state Commission on Innovation and Excellence in Education prepares to make recommendations on how to improve Maryland’s education funding system, a new report from the Maryland Center on Economic Policy examines the state’s compensatory education system—targeted grants to help school districts effectively serve low-income students—and recommends policy solutions to make it more effective.

When children grow up in families that struggle to afford the basics, they often face an array of challenges in daily life that make it harder for them to succeed in school. Compensatory education aid is an essential policy tool that helps children overcome these barriers. A large body of research shows that providing additional school funding – and investing it in evidence-based practices like expanded learning time and one-on-one tutoring – can make a big difference in children’s lives.

Unfortunately, Maryland’s current school funding system leaves too many students behind. Twenty of Maryland’s 24 school districts are now underfunded, thanks to a series of gradual cuts to state aid following the Great Recession. School districts with lower property values and incomes were hit hardest, as they are the most dependent on funding from the state.

“Public education is part of the foundation of a thriving state and something we know Marylanders value. It is essential that this review process fix the areas where our current system falls short,” Maryland Center on Economic Policy Executive Director Benjamin Orr said. “Good schools not only benefit our students, they also strengthen our economy by building a skilled workforce and making Maryland an attractive place to live and do business.”

The report recommends three steps to ensure that all schools have the resources they need:

• Modernize the way low-income students are counted. An effective compensatory education system requires accurate data on the number of low-income students in each school district. The state historically counted students as low income if they were eligible for free or reduced-price lunch. This method is less reliable today than in the past because many schools now provide free lunch to every student. A better method is direct certification, which involves matching school records with data from other public agencies that already collect income information.
• Strengthen support for low-income districts. Maryland’s lower-income school districts are less well funded than wealthier districts, which makes it harder for them to balance their budgets, attract well-qualified teachers and ensure that students succeed. To fix this imbalance, Maryland should strengthen compensatory education by increasing the low-income student weight used in the funding formula.
• Target resources toward concentrations of poverty. Currently, school districts get the same amount of compensatory education aid for each low-income student. However, the barriers students face magnify when large numbers of low-income students attend the same school. This makes it harder for all students in the school to succeed. Providing additional resources in communities that face concentrated poverty would enable students in these areas to access the supports they need to thrive.

“Invest in Every Child: The Future of Compensatory Education Aid in Maryland,” as well as MDCEP’s prior analysis of equity in the state’s education funding formula, is available at mdeconomy.org/edfunding.

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About Maryland Center on Economic Policy

The Maryland Center on Economic Policy advances innovative policy ideas to foster broad prosperity and help our state be the standard-bearer for responsible public policy. We engage in research, analysis, strategic communications, public education, and grassroots alliances promoting robust debate and greater public awareness of the policy choices Maryland residents face together.