Designing School Aid Formulas to Achieve High-Quality and Equitable Education

This paper describes the school funding formulas necessary to achieve five broad funding goals that have driven school finance policies over the past 50 years. After briefly summarizing the type of formulas state governments use, it highlights two states, one with a successful funding system and one that is less successful in achieving its funding goals. The paper concludes with recommendations for policies aimed at improving the ability of state school aid formulas to achieve high-quality and equitable education.

A companion Lincoln Institute working paper, What Makes a Fair School Finance System?, explores the complexities involved in defining school funding equity and fairness.