Chicago Tribune “Letter To The Editor”: Reassess school funding

Larry Joseph, director, Fiscal Policy Center at Voices for Illinois Children writes:

The Tribune’s recent article on “poverty grants” to local school districts raises some important issues about education funding in Illinois (“Illinois’ method for measuring student poverty raises count statewide,” News, April 24).

The Fiscal Policy Center at Voices for Illinois Children agrees that state resources should be targeted more effectively to school districts with the greatest need — those with low levels of property tax wealth and those with large concentrations of low-income students.

Regular General State Aid is designed to provide more funding to school districts with fewer local resources. Grants for supplemental GSA are commonly known as poverty grants, but this term is misleading. Under various statutes over many years, the state has allocated these funds on the basis of a school district’s concentration of low-income students. “Low-income” is generally defined as income below 200 percent of poverty level.  Under current federal guidelines, the low-income cutoff for a family of three would be about $39,000.

Before 2003, the state had used data from the most recent U.S. Census to estimate a school district’s low-income enrollment.  But since the Census was conducted only every 10 years, the numbers quickly became outdated. The state adopted an alternative low-income measure — a count from the Department of Human Services of participation in Medicaid, the Children’s Health Insurance Program and other programs.

This reasonable policy decision has had unanticipated consequences. Since 2003, the DHS count has increased substantially, mainly because of the steady growth of children’s enrollment in Medicaid and CHIP — something that policymakers could not foresee 10 years ago. Accordingly, the amount of supplemental GSA has greatly increased.

This trend doesn’t necessarily mean that the state is spending too much on low-income grants. Policymakers should reassess the current set of formulas for both regular GSA and supplemental GSA.  Both components of General State Aid to school districts are woefully underfunded.