Collaboration in Civic Spheres

State report: K-12 spending hikes would yield modest gains

by October 17th, 2012

In its McCleary ruling last January, the Washington Supreme Court said the state has failed to meet its constitutional responsibility “to make ample provision for the education of all children.” As a result, by 2018, state K-12 spending could grow by one-fifth, legislative fiscal staff told researchers at the state’s in-house think tank, the Washington State Institute for Public Policy. But in keeping with its mission to get to the bottom of what constitutes effective policy, the Institute wanted to know more. So in a new report titled “K-12 Education Spending and Student Outcomes: A Review of the Evidence,” Institute researchers Steve Aos and Annie Pennington, ask and try to begin to answer the question, “If K-12 spending is increased, is there reason to believe that student outcomes will improve and, if so, by how much?…That is, does money matter?” Their survey of the best academic literature shows a modest, some might say quite modest, positive relationship between increased general K-12 education spending and student outcomes.

However, a broader follow-up report due next July from the Institute and funded by the MacArthur Foundation, could reveal more about what specific strategies and programs are most likely to move the needle on graduation rates.

From K-12 Education Spending and Student Outcomes/Washington State Institute of Public Policy, Oct. 2012

In the current report, released this month by the Institute, Aos and Pennington carefully selected 40 studies (mostly from around the U.S.) with the strongest research designs, and where K-12 per-pupil expenditures were able to be directly correlated with student outcomes – either in terms of changes in scores on standardized tests, or changes in graduation or drop-out rates. They found that on average, for each 10 percent increase in per-pupil spending, there was an annual positive change in student outcomes of less than three-quarters of one percent in early grades, and that the benefit in percentage terms – across the various indicators – declined to an average annual gain of zero percent or nearly zero percent moving toward the end of high school.

However, small annual gains can add up, at least to a degree. The report stressed that over the course of the 13 years between kindergarten and high school graduation, a sustained level of spending ten percent higher in the aggregate than a flat level would, for example, boost the on-time graduation rate from the current 76.6 percent in Washington state to 79.5 percent. Divided by the baseline figure, that 2.9 percent bump actually would represent a 3.7 percent improvement over the 13 years, the researchers underscore. Based on that “elasticity” – or correlation between a percentage change in one increment with a percentage change in another – a 20 percent increase in K-12 per-pupil spending could lead to an approximate doubling of the benefit, to 6 or 7 percent.

Using an approved cost-benefit model and focusing on the outcome of on-time graduation rates, the follow-up report due in July will project the relative bang-for-buck from more particular policy strategies such as targeting improved teacher effectiveness, and from combinations of specific strategies – rather than just looking at gains from an incremental hike in general per-pupil spending, as the current report does. Other strategies to be examined for ability to improve performance outcomes will include smaller class sizes, all-day kindergarten, longer school days and longer school years, enhanced early childhood education, ramped up programs to recruit, hire and retain especially talented teachers, and more and better after-school programs, said Pennington, the Associate Director of the Institute.

Of the interim results in the current report she said, “given that the impacts are stronger in the early grades, one option may be to concentrate more resources there.”

Where state monies would come from to boost K-12 spending is still unclear. One approach, Initiative 1098 in 2010 for a state income tax on high earners to fund education and other programs, was roundly rejected by voters. A Joint Task Force on Education Funding is to report its suggestions to the legisalture by year’s end.


McCleary V. Washington ruling

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