The Outsized Role of Parent Contributions in Elementary School Finance

Blog Post
May 2, 2017

Our nation’s neediest students – those facing the greatest risk for academic failure and with the greatest need for supports – are disproportionately attending schools that serve large numbers of students from low-income families. Their schools are often inadequately funded, which means the students often lack access to many of the academic and enrichment supports that their peers in more affluent schools or districts receive. A contributing factor to this inequity is complicated school funding formulas and local property tax provisions that inadvertently direct less money to the schools serving lower-income students.

Of course, those contributors to inequity are well-known. A new report from the Center for American Progress (CAP), however, highlights an oft-overlooked additional source of revenue for some of the most affluent schools and districts in the nation – private donations from parents of students through parent-teacher associations (PTAs). These donations further exacerbate inequity.

The report shows that the “50 richest PTAs raised nearly $43 million, an average of $867 for each student enrolled in those schools.” This is significant when you consider that researchers from the National Bureau of Economic Research have found that for every additional $1000 in per-student spending, there is a significant increase in test scores – greater than the effects of many other initiatives aimed at increasing student achievement. In fact, NBER claims that no other large scale reforms have had such a significant impact. In short, money in fact does matter.

The CAP report holds up Horace Mann Elementary School in Northwest Washington, DC – one of the most affluent schools in the city – as an example of the impact parent donations can have. Horace Mann spent an additional $1600 per student in the 2013-14 school year, which paid for additional staffing including new art, music, and physical education teachers and classroom aides. Other common investments made by PTAs include after-school programs, clubs, drama programs, field trips, supplies and materials for teachers, equipment, and other enrichment programs.

Interestingly, 35 of the 50 richest PTAs are elementary schools. Since we know that the knowledge and learning experiences gained in the early grades sets the foundation upon which future learning is built, all students in elementary schools in particular – especially the most disadvantaged– need every opportunity to access supports that will help them succeed. Yet, many of these supports are beyond the financial means of a low-income school’s budget.

The authors argue that district leaders have a responsibility to “promote greater transparency of private contributions and create systems to allocate all resources equitably.” They make a number of recommendations for how district leaders should address this issue, including conducting an annual needs assessment for every school and supporting partnerships between schools. They also present a number of approaches to directly tackle inequities in parent donations, including redistributing donations, restricting the use of funds, incorporating predicted donations into school budgets, and encouraging donations to districts.

The report offers Montgomery County in Maryland as an example of a district that restricts the usage of funds by prohibiting the use of parent donations for school staffing. This policy can help maintain equity because teacher quality is shown to be the greatest in-school factor on student achievement.

Also included in the report are two districts that require PTAs turn over a portion of funds raised for redistribution across all schools in the district.  Portland Public Schools in Oregon, for example, collects one-third of the PTA’s donations. Similarly, the Santa Monica-Malibu School District in California requires that funds raised for “specific schools intended to replace personnel, programs or services cut by the Board in the process of budget reduction, unless sufficient funds are received to restore” be placed in an equity fund and distributed across all the district schools.

States can also take action. In an interview, Mike Griffith from the Education Commission of the States explained that New Mexico accounts for PTA contributions in the state’s funding formula so that schools receiving large amounts of private donations receive less state funding. With the passage of the Every Student Succeeds Act (ESSA) in 2015, states are now required to report expenses at the school level, in addition to the district level, which will go a long way in increasing the transparency of private donations and their use. 

Tackling this issue, however, requires great care as district leaders must balance the desire to create greater equity across schools without deterring parents from making contributions to public schools. A parent’s incentive to contribute additional monies to schools is often directly related to a desire to provide their child with additional educational opportunities and redistributing their funds to other students can serve as a disincentive to donate. In fact, largely as a result of the 2011 policy put in place in the Santa Monica-Malibu School District, some parents are pushing for a separation of the district whereby the more affluent Malibu schools will create their own district, as reported by Dana Goldstein with the New York Times. A question of whether redistribution policies will serve as an impetus for re-segregation can’t be ignored.

On the other hand, based on CAP’s analyses comparing districts with equitable distribution policies in place to demographically similar districts without, the authors found that having those policies in place did not significantly influence contributions in the districts analyzed. The study was limited, however, since they were unable to compare contributions before and after the policies were put in place.

CAP’s report highlights an important factor in school funding that is often overlooked, but perhaps even more significant is that the report joins an abundance of evidence that proves there are flagrant funding inequities across public schools that continue to perpetuate the large achievement gap that exists.