Everyone knows it’s important to invest in education. Education is the surefire way to also invest in our prosperity, productivity, health, and security – the whole shebang. That is why, across the country, education represents one of the largest percentages of every state’s budget – because from policymakers to parents, it is understood that providing education opportunities to children in this country is imperative for our success.
One tiny problem: In most states, the state sends money out to the districts to fund education, and then…. then we’re not sure what happens. We know, obviously, that the money gets spent on educating students – great! But we don’t really know how that money is spent, or on which students. Nor do we know if the money we’re spending is aligned with the state’s education priorities. If we want all third graders reading at grade level by the end of each school year, are we spending dollars on the resources that are proven to make that happen? Who knows.
This is because to date, data on how dollars are allocated and spent on education have been unclear and are not linked to the outputs we care about. By collecting and linking accurate, clear financial data to education input and outcome data, states could better understand and react to the costs of education – including personnel, programs, and instructional resources – and their value to state education priorities.
Without accurate financial data linked to other education data, states and districts will not be able to distinguish between what education expenditures cost versus their value. Consequently, when state budget shortfalls fell hard on states a few years back, cuts were made on areas that were expensive for schools, including, for example, teachers. Teachers’ salaries are usually the greatest individual expense in education budgets. However, teachers also create the most value relative to their expense, as they provide human capital and instruction time. Without clear data linking teachers—and other education resources—to their outcomes, states and districts may cut valuable, cost effective resources, which could be detrimental to meeting desired student achievement outcomes.
One state, Oregon, has taken a first step in calculating the “return on investment” for each of its school districts, as well as using that information to help develop new strategies to better target funds toward improving learning outcomes of the state’s students. This is an important goal, but it is not going to be easy work. If states want to pursue similar goals, they will need to evaluate how federal, state, and district policies impact how financial data are collected and used.
Though the work will be challenging, it is time for states to shift away from viewing education spending through the mindset that asks, “how much do we spend?” to one that asks, “why do we spend our money this way?” To steal a great line from my colleague, it is time to stop “hiding the money under the mattress,” and instead, collect and link financial data in a way that empowers policymakers to make investment decisions to support student achievement.