Who Pays the Tab for K-12 Education?
“Who Pays the Tab for K-12 Education?
Source: Education Commission of the States
Public education in the United States was originally established, run, and financed by local communities. While these local districts initially used several different methods to fund education—including student fees, contributions by community members, and various forms of local taxation—they eventually moved to funding education almost exclusively through local property taxes. This came to fruition because local property taxes are a predictable funding source and relatively easy to collect. In addition, property taxes are based on the value of the taxpayer’s property, which can be used as a proxy, albeit an imperfect one, for an individual’s wealth. The use of property taxes as the primary source of education funding has resulted in a system where students living in property-wealthy communities have received a significantly higher level of educational resources than students living in property-poor areas.
Not only can this situation be unfair to students, it can be and has proven to be unfair to taxpayers in many circumstances. Property owners who live in a property-poor community often face higher tax rates than those living in property-wealthy communities. This is due to the fact that property-poor districts require a higher tax rate to raise the same amount of funding as property-wealthy communities. For example, if the per capita property wealth in District A is $100,000, and in District B it is $300,000, District A would require a tax rate three times higher than District B to raise the same amount of funding.
Since the 1920s, states have become more and more involved in public education funding to address the issue of unequal funding from district to district. State involvement in education funding accelerated in the 1970s due to court decisions, the involvement of activists, and reform-oriented governors and state legislators, along with a relatively healthy economy. This sparked a series of reforms that resulted in major structural changes in the school finance systems of more than 30 states.”