October 14, 2016 Print

Michigan recently spent nearly $400,000 to determine how effective its education spending is and whether more taxpayer funds should be spent in order to improve student achievement. Such school funding “adequacy” studies, however, paint an incorrect picture. The Mackinac Center for Public Policy, based in Midland, Mich., released “School Spending and Student Achievement in Michigan: What’s the Relationship?” a study that more rigorously examines the relationship between school funding levels and student outcomes. Mackinac found that there is no significant connection between education spending and the vast majority of academic indicators.

“The results of our rigorous, building-level study weren’t surprising in the context of most relevant credible academic research,” explain Ben DeGrow, director of education policy at the Mackinac Center. “Simply adding funds into the current system produces virtually no impact on student learning. Michigan currently is in the top third of states in education spending and in the bottom 10 for academic achievement.”

The Colorado-based firm Augenblick, Palaich and Associates (APA) won the contract for the state’s adequacy study and published its findings this summer to little fanfare. In examining the history of state education adequacy studies within the Mackinac’s survey, however, Degrow and Edward C. Hoang note that “school funding adequacy studies are not new: There were 39 such studies performed in 24 different states between 2003 and 2014. Of these, 38 concluded that additional tax dollars were needed to meet the designated standard of adequacy. APA conducted 13 of these 39 studies, recommending a funding increase every time.”

The study explains that one of the methods APA uses to reach its estimates for school funding increases is called the “professional judgment” method, which is based on nothing more than asking school district officials to name the amount of resources they think they will need to attain successful academic achievement.

“In 2005 APA used the professional judgment method to assess Connecticut’s school finance system, which at the time ranked fourth nationally in per-pupil revenue,” DeGrow and Hoang continue. “Its recommendation called for a 35 percent increase to make the Nutmeg State’s K-12 funding ‘adequate.’ Public schools in the District of Columbia receive more money on average per pupil than any other jurisdiction in the nation (over $29,000 per student), and APA also recommended that its funding be increased by 22 percent.”

One of the primary insights from the School Spending and Student Achievement in Michigan study is that there exists little correlation between spending inputs and learning outcomes in Michigan.

“Averaged across the general student population, there was no statistically significant correlation between a school’s spending levels and its students’ academic performance in 27 of the 28 academic indicators used in the model,” DeGrow and Hoang write. “In the only category that did show a statistically significant correlation — seventh-grade math — the impact of spending more was very small. The model shows that a school would need to spend 10 percent more to improve its average seventh-grade math scale score by just .0574 points.”

A recent DeGrow commentary about the effects of the state’s adequacy study reports that the results of the APA study “deflated hopes that more money would overcome Michigan’s flagging educational performance. APA found that every additional $1,000 spent per pupil would lead to a 1 percent gain in proficiency on state tests. At that rate, doubling state funding to K-12 education would not be enough to ensure even one-third of the state’s 11th-graders met the mark in math.”

Better outcomes for underperforming schools will instead need to come from systemic reform to use existing resources more efficiently and establish repercussions for poor performance, a process that can be hastened by the competitive pressures of robust school choice programs. Funding increases alone simply don’t have the desired effect.

“Our study’s key finding shaped how the state’s official education finance study was later received,” DeGrow concludes. “Other states that face pending adequacy studies can produce and disseminate similar research to help avoid costly tax hike proposals or the long, tortured path of education funding litigation.”