New ESSA Provision Aims to Boost School Funding Transparency

New ESSA Provision Aims to Boost School Funding Transparency

Where do the billions of dollars allocated for K-12 education in the United States each year actually end up?

A new mandate borne of the federal Every Student Succeeds Act (ESSA) aims to answer this question by requiring the addition of state-by-state data points to each state’s annual report card. With this improved insight, parents, teachers, policymakers, and other interested parties will theoretically be able to more accurately "follow the money." 

Education Week reporter Daarel Burnette II recently explored this topic as part of a walkthrough of the ESSA school spending provision. To be clear, the mandate itself is not new—it came into being with the ESSA legislation back in 2015—but summer 2020 is the deadline for all states to report how their portion of the federal government’s annual $700 billion budget gets spent. As Burnette noted, 17 states have already complied with the ESSA mandate, leaving the rest with less than a year to pull together their school finance data. 

At a time when two-thirds of our nation's states are racing against the clock to incorporate increased data insight, let's take a closer look at the ins and outs of the ESSA school finance requirement.

Will the mandate actually improve equity?

In his article, Burnette explained that by requiring states to divulge precisely where their federal education dollars get spent on a school-by-school basis—not just per pupil, as previously necessitated—the mandate adds another layer of transparency to the often-murky world of school finance. But although the new requirements will shine a spotlight on local spending decisions, more than two-thirds of principals and district administrators do not believe this will lead to “more equitable spending.” According to Burnette, one of their main concerns is that the reams of newly available information may ultimately amount to little more than a “data dump” that stakeholders (whom he defined as “state officials, school board members, principals, teachers, [and] parents”) will be left to interpret—or misinterpret—on their own.

And it's not just school administrators who have reservations. Writing for Education Week, Andrew Ujifusa described how Jim Blew, Assistant Secretary for Planning, Evaluation and Policy Development for the U.S. Department of Education, was somewhat cynical about the school finance reporting provision at an October policy event. According to Ujifusa, Blew criticized the states that have already complied with the mandate by accusing them of “hiding” the required information in the recesses of obscure websites and the like. 

How will stakeholders use the information?

Armed with additional budget information, parents could ostensibly make school choice decisions based on funding reports or, as Burnette phrased it, “end up grilling administrators and school board members on whether the amount being invested in their child’s school is enough.” 

And let's not forget that the federal government is obligated to help fund a “free and fair education” for all students, including those with a range of special education needs. Thus, families with students in special education programs could theoretically track where money is going and how it translates into programming options.

At the event recounted by Ujifusa, Blew tied these expected phenomena to school choice (a priority under Secretary of Education Betsy DeVos) and savings for taxpayers who may want more “bang for their buck” when it comes to public education. His point was taken up by fellow panelist Marguerite Roza of Georgetown University—who, according to a report by Erika Ross of, went on to lead the audience in a game of “Would You Rather?” to spark conversation around how people think limited education dollars should be spent.

A cautionary note

Although attaining greater transparency in school funding is certainly an admirable goal, it is important to remember that any numbers shared may not be accompanied by contextual information. As a result, Burnette warned readers of his Education Week piece to “be cautious in drawing conclusions from the bottom line alone.” 

After all, an array of extenuating circumstances from hidden transportation fees to infrastructure costs could make it difficult to grasp exactly how money is being spent, and higher spending may not necessarily equate to better services for students. Moreover, many state and local school budgets are already stretched thin, so finding staffers who can devote time to compiling and sharing budget details may be quite difficult.

Regardless, all states will need to comply with the ESSA school finance provision by summer 2020. Although stakeholders may initially run into the data access and interpretation issues cited by Blew, further details about how federal education dollars are being spent locally could end up providing parents, elected officials, and other community members with valuable insight into whether money is going to where it is most needed.

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