Title I Funding
Poor Children Benefit Though Funding Per Poor Child Differs Gao ID: GAO-02-242 January 31, 2002The Title I program spends $8 billion each year on elementary and secondary education. Although state and local funds account for more than 90 percent of national education expenditures, Title I has been an important source of funding for many poor school districts and schools since 1965. In the 1999-2000 school year, Title I funds were targeted on the basis of numbers and percentages of poor children, but the complex allocation process resulted in differences in actual funding per poor child. When the numbers of children from low-income families shift among states, Title I allocations adjust, but not completely, and a state whose share of the nation's poor children changed from year to year would not necessarily see a corresponding change in its Title I allocation amount. The following two factors account for this: lack of current poverty data and various hold-harmless provisions. GAO found no monetary, statutory, or regulatory incentives for states to target their own funds to children from low-income families. Several policy options could increase Title I funds allocated to states and school districts with high numbers and percentages of poor children. These options include changing the appropriations hold-harmless provisions, funding the targeted grant, using an alternative cost factor, and raising the basic grant eligibility threshold.
GAO-02-242, Title I Funding: Poor Children Benefit Though Funding Per Poor Child Differs
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United States General Accounting Office:
GAO:
Report to Congressional Addressees:
January 2002:
Title I Funding:
Poor Children Benefit Though Funding Per Poor Child Differs:
GAO-02-242:
Contents:
Letter:
Results in Brief:
Background:
Allocations Based on Poverty, but Complex Allocation Process Results in
Different Allocations Per Poor Child Among States, Districts, and
Schools:
Allocations Do Not Fully Adjust to Geographic Shifts in the Number of
Children From Low-Income Families:
Allocations Do Not Encourage States To Target Their Own Funds To
Children From Low-Income Families:
Using Less Restrictive Hold-Harmless Provisions, Revising Grant
Formulas, or Raising Eligibility Threshold Could Shift Funds Toward
Poorer Districts and/or Reduce Funding Variations Among Districts:
Concluding Observations:
Agency Comments:
Appendix I: Objectives, Scope, and Methodology:
Appendix II: Supporting Data:
Variation in Funding Per Child Under Alternative Hold-Harmless Rules by
Poverty Groups:
Replacing State Per-Pupil Expenditure Factor With a Cost of Education
Factor:
Appendix III: Selected Provisions of the ’No Child Left Behind Act of
2001“ and Related Appropriations Appendix IV Comments From the
Department of Education:
Appendix V: Comments From the U.S. Department of Agriculture:
Appendix VI: GAO Contacts and Staff Acknowledgments:
GAO Contacts:
Staff Acknowledgments:
Tables:
Table 1: Distribution of Title I Basic Dollars to States, 1999-2000
School Year:
Table 2: Distribution of Basic and Concentration Grant Allocations
Among Urban and Rural School Districts, 1999-2000 School Year:
Table 3: Distribution of Title I Schools, Title I Funds, and Children
in Title I Schools by School‘s Percentage of Poor Children, 1999-2000
School Year:
Table 4: Use of Poverty Updates in Title I Formula Calculations:
Table 5: Percentage Differences in Average Funding Variation Under
Alternative Hold-Harmless Rules Compared With a 100-Percent Rule:
Table 6: Funding Per Poor Child Under Current Law and Under a Policy
Option That Funds Targeted Grants Instead of Concentration Grants:
Table 7: Funding Per Poor Child Under Current Law and Formula Options
That Replace State Per-Pupil Expenditure Factor With a Teacher Cost
Factor:
Table 8: Number of Eligible School Districts, Children, and Funding Per
Child Under Alternative Eligibility Thresholds:
Table 9: Number of Ineligible Districts, Poor Children, and Title I
Funding They Would Receive Under Alternative Eligibility Thresholds:
Table 10: Distribution of Districts, Poor Children, and Title I Dollars
by Extent of Difference Between District Allocations and Formula
Calculations:
Table 11: Percentage of Poor Children and Percentage of Dollars
Allocated to Districts Whose Allocations Differed From Formula
Calculations by More Than 1.5 Percent:
Table 12: Percentage of Poor Children and Percentage of Dollars
Allocated to Districts Whose Allocations Differed From Formula
Calculations by More Than 10 Percent:
Table 13: Differences Between Actual Allocations and Formula Calculated
Amounts, 1999-2000 School Year:
Table 14: Number of Students, Districts, Districts Sampled, and
Response Rates by Survey Strata:
Table 15: Sampling Errors:
Table 16: District Funding Per Child by Poverty Group:
Table 17: Variation in Funding Per Child Within Poverty Groups:
Table 18: Percentage Change in Funding With No Hold-Harmless, Analysis
by Changes in State Poverty 2001-2002 (States Ranked by Percentage
Growth in the Number of Poor Children):
Table 19: Funding Per Child by Poverty Group Under Formula Options That
Replace State Per-Pupil Spending With a Cost of Education Factor:
Table 20: Variation in Funding Per Child Within Poverty Groups Under
Formula Options That Replace State Per-Pupil Spending With a Cost of
Education Factor:
Table 21: Change in Title I Appropriations Between Fiscal Years 2001
and 2002:
Figures:
Figure 1: Distribution of School Districts by Size and Percentage of
Children in Poverty:
Figure 2: Basic Grant Dollars Per Poor Child in Districts With 100 to
250 Children Eligible for Free or Reduced-Price Lunch, 1999-2000:
Figure 3: Concentration Grant Dollars Per Poor Child in Districts with
100-250 Children Eligible for Free or Reduced-Price Lunch, 1999-2000:
Figure 4: Title I Allocation Priorities of School Districts by
Location:
Figure 5: Variation in Funding Per Child Under Alternative Hold-
Harmless Rules (Districts Grouped by Percentage of Poor Children):
Figure 6: Percentage Change in Funding With No Hold-Harmless Rule
(States Ranked by Percentage Growth in the Number of Poor Children):
Figure 7: Comparison of the Variation in Funding Per Child Across
School Districts Under Formula Options That Replace State Per-Pupil
Spending With a Cost of Education Factor (Fiscal Year 2001):
Abbreviations:
GAO: General Accounting Office:
NSLP: National School Lunch Program:
TANF: Temporary Assistance for Needy Families:
[End of section]
United States General Accounting Office:
Washington, DC 20548:
January 31, 2002:
Congressional Addressees:
Title I is the largest federal program supporting elementary and
secondary education and with annual expenditures of about $8 billion,
accounts for about 3 percent of total education expenditures
nationally.[Footnote 1] While state and local funds account for over 90
percent of national education expenditures, Title I is an important
source of funding for many high-poverty districts and schools. Created
in 1965 as part of the War on Poverty, Title I is designed to help
educate disadvantaged children”those with low academic achievement
attending schools serving high-poverty areas.
The amount of funds schools receive is the result of a multi-step
process that combines formula calculations and state and district
decisions. States receive funding for their districts from the U.S.
Department of Education (Education), which calculates how much states‘
school districts are entitled to based on their numbers of children
from low-income families (poor children) as measured by Census Bureau
data and their state‘s per-pupil education expenditures (a proxy
intended to reflect cost differences among states in providing
education). When states receive Title I funds, they make adjustments to
the calculated district-level amounts in order to set aside funds for
state administration and account for differences between their actual
school districts, including charter schools, and the districts
appearing in Education‘s database.[Footnote 2] Once districts receive
funds from their states, they have some flexibility in how they
allocate funds to individual schools, but generally must target schools
with higher percentages of poor children. Not all school districts
receive Title I funds because they might not have a minimum number
and/or percentage of poor children to meet eligibility thresholds.
In the past several years, the Congress has been concerned about the
achievement gap between disadvantaged students and their more
advantaged peers and how to improve the performance of children from
low-income families. Some studies have indicated that schools with
higher numbers and percentages of poor children may have higher costs
associated with raising student performance. The Congress has had a
dilemma of wanting to improve the performance of poor children through
increased targeting of poor children while simultaneously protecting
districts whose share of these children has declined from losing a
significant amount of funds. To increase targeting, in 1994 the
Congress added a new formula to the Title I program, which would have
provided more funds to districts with higher numbers and percentages of
children from low-income families, but until fiscal year 2003, no funds
were appropriated for this formula. To protect districts from a
significant loss of funds when their numbers of poor children decline,
the Congress has implemented several ’hold-harmless“ provisions. The
issues of targeting and hold-harmless provisions were much debated in
Congress‘ recent efforts to reauthorize the Title I program.
In light of these issues, the Congress mandated GAO to study Title I
allocations, specifically (1) the extent to which Title I funds are
allocated to states, school districts, and schools with the greatest
numbers and percentages of school-age poor children; (2) the extent to
which allocations of such funds adjust to shifts in the numbers of poor
children; (3) the extent to which the allocation of Title I funds
encourages the targeting of state funds to school-age poor children;
and (4) what options might improve targeting of funds, especially to
states and school districts with higher numbers and percentages of poor
children, to more effectively serve those children.[Footnote 3]
In doing our work, we performed extensive analysis of data collected
from a number of federal, state, and local sources. We obtained data on
Title I formula allocations for school years 1999-2000, 2000-01, and
2001-02 from Education and obtained the actual allocations received by
school districts in the 1999-2000 school year from state officials. We
interviewed every state Title I director, surveyed a nationally
representative sample of school district administrators, and
interviewed representatives of relevant federal agencies and national
organizations. We conducted our work from December 2000 through
December 2001 in accordance with generally accepted government auditing
standards. Appendix I provides a more detailed discussion of our
methodology.
Results in Brief:
In the 1999-2000 school year, Title I funds were generally targeted
based on numbers and percentages of poor children, but the complex
allocation process resulted in differences in actual funding per poor
child among states, school districts, and schools. States with similar
numbers and percentages of poor children did not always receive similar
Title I allocations. The same was true of school districts. State and
district funding levels differed because factors other than numbers of
poor children are included in Education‘s formula calculation, for
example, the amount a state spends on education. At the school level,
more dollars were targeted to schools with higher percentages of poor
children. However, funding per poor child still varied at the school
level, reflecting the flexibility districts have in setting priorities
and allocating funds to individual schools, such as to target funds to
elementary schools rather than to middle or high schools.
When the numbers of children from low-income families shift among
states, Title I allocations adjust, but not completely. In other words,
a state whose share of the nation‘s poor children changed from one year
to another would not necessarily see a corresponding change in its
Title I allocation amount. Principally, two factors account for this
lack of responsiveness ” a lack of current poverty data and various
hold-harmless provisions. Education uses Census Bureau estimates of
poor children, which are available only on a lagged basis, to calculate
allocations. Over the past decade, the Census Bureau has been required
to increase the frequency with which it updates poverty data, allowing
the Department of Education to use more current Census data to make
Title I formula calculations more responsive to shifts in poverty. The
hold-harmless provisions limit the extent to which Title I funds can
shift at all, even when shifts in poverty occur. In the absence of
these provisions, some disparities between Title I formula calculations
and poverty would remain because the Census data always lags behind the
years in which it is used for the formula.
The allocation of Title I funds does not encourage states to target
their own funds to children from low-income families. Our review of the
Title I statute and regulations found no monetary, statutory, or
regulatory incentive for them to do so. For example, states do not
receive extra Title I funding in return for targeting state funds to
poor children. According to recent interviews with state Title I
directors and our previous studies, Title I allocations are rarely used
by states as a model for targeting their own funds.
A number of policy choices could increase the extent to which Title I
funds are allocated to states and school districts with high numbers
and percentages of poor children, if desired. The policy choices for
doing so include changing the appropriations hold-harmless provisions,
funding the targeted grant, using an alternative cost factor, and
raising the basic grant eligibility threshold. Using less restrictive
hold-harmless provisions would reduce the differences in funding among
school districts with similar numbers and similar percentages of poor
children and allocate more to states with more rapidly growing numbers
of poor children. Funding targeted grants and raising the eligibility
threshold would shift funding toward districts with higher percentages
of children in poverty and away from districts with lower percentages.
Using an alternative cost factor instead of per-pupil expenditures
would also have the effect of shifting funds to districts with higher
percentages of children in poverty and to a lesser extent to districts
with large numbers of children in poverty. The extent to which formula
changes are desired would depend on the desired balance between, among
other things, making formula allocations reflective of numbers and
percentages of poor children and making formula allocations relatively
stable. The full effect of each change would depend on whether other
changes were made at the same time and on the extent to which states
later altered the resulting formula amounts before distributing the
funds to their school districts.
In written comments on our draft report, the Department of Education
generally agreed with the reported findings. The U.S. Department of
Agriculture, in commenting on the draft report, highlighted its
concerns about the quality of school lunch data, which we used as one
of our measures of poverty. Although we acknowledge that these data
have limitations, we believe that our use of school lunch data, in
combination with Census poverty estimates, was appropriate.
Background:
Title I grants are intended to help elementary and secondary schools
establish and maintain programs that will improve the educational
opportunities of low-income and disadvantaged children. Title I funds
are intended to provide instruction and instructional support for these
disadvantaged children so that they can master challenging curricula
and meet state standards in core academic subjects. The law does not
stipulate exactly how Title I funds are to be spent. Instead, Title I
is an example of flexible funding that local and state educational
agencies may use as they deem best.
Title I funds are directed toward states and school districts with
greater numbers and percentages of poor children regardless of the
level of funding they receive from state and local sources. Although
the amounts that states and localities spend on education vary due to
differing resource bases and funding priorities, Title I funds are not
intended to compensate for this variation.
Federal Allocation Process:
The U.S. Department of Education each year determines the distribution
of Title I funds according to the mandates of the law. The authorizing
legislation in effect through the 2001-02 school year provided for four
different kinds of Title I grants:
Basic Grants are the primary vehicle for Title I funding and are the
easiest grants for which school districts can qualify. Districts are
eligible for basic grants if they have at least 10 poor children and
the number of poor children is more than 2 percent of the district‘s
school-age children.[Footnote 4] Nationally, about 92 percent of school
districts (containing over 99 percent of poor children) receive basic
grants, which accounted for about 85 percent of the Title I funds
distributed in fiscal year 1999.
Concentration Grants are somewhat more directed to poor districts than
basic grants because district eligibility criteria for concentration
grants are stricter than those for basic grants. Districts are eligible
for concentration grants if they have more than 6,500 poor children or
the number of poor children is more than 15 percent of the district‘s
school-age children. Nationally, about 60 percent of school districts
(containing about 85 percent of poor children) receive concentration
grants, which accounted for about 15 percent of the Title I funds
distributed in fiscal year 1999.[Footnote 5]
Targeted Grants were not funded until fiscal year 2003.[Footnote 6]
Targeted grants would be directed more to high-poverty states and
districts; as the number and percentage of poor children in the
district increase, the targeted grant amount would increase both in
absolute dollars and proportionally to other districts. A district
would be eligible for targeted grants if it had at least 10 poor
children and these children accounted for at least 5 percent of its
school-age children. In the 2001-02 school year, about 86 percent of
school districts, containing 99 percent of poor children would have
been eligible to receive targeted grants had they been funded.
Incentive Grants were not funded until fiscal year 2003.[Footnote 7]
Incentive grants would not be distributed on the basis of poverty, but
would provide additional funds to states that demonstrate high state
spending relative to their tax base and states that have less disparity
in funding among their districts. Under this formula, states would
distribute funds to districts in proportion to the remainder of their
Title I allocations.
Title I funds are distributed from the federal government to the
states, based on data that are measured at the school district and
state levels. Since school year 1999-2000, for each school district
meeting eligibility requirements based on numbers and/or percentages of
poor children, Education has based its formula calculations on the
number of poor children in the district. (Prior to that time, formula
calculations were based on counties rather than school districts. The
change occurred, in part, due to concern that poor school districts in
otherwise wealthy counties were not receiving the Title I funds they
needed.) The funding formula for basic and concentration grants
principally involves multiplying the number of poor children in a
school district area, as measured by Census and other data sources, by
the state‘s average per-pupil expenditure, although these amounts are
subject to hold-harmless provisions and a ’small state minimum“
provision. These key elements of the funding formula for basic and
concentration grants are described below:
* Poverty: the number of poor children in the school district area, as
estimated by decennial Census data and updated by the Census using
statistical modeling techniques. (The poverty threshold for the 2000-01
school year for a family of four was an annual income of $17,050.)
* Expenditures: forty percent of the state‘s average per-pupil
expenditure, limited to a minimum of 80 percent and a maximum of 120
percent of the national average expenditure.[Footnote 8] This measure
is included as a proxy for education costs.
* Small state minimum: Each state is guaranteed a minimum level of
funding, which is the smaller of either one-quarter of 1 percent of the
overall appropriation, or the average of one-quarter of 1 percent of
the overall appropriation and the state‘s number of eligible students
multiplied by 150 percent of the national average per-pupil payment.
[Footnote 9]
* Hold-harmless provisions: guarantee each state and district a minimum
level of funding based on past allocations. That is, the allotment
cannot be less than a specified percentage of the preceding year‘s
allotment. Such provisions are intended to moderate the effects of any
large year-to-year shifts in program funding, numbers of eligible
children, or state education spending.[Footnote 10] The hold-harmless
provisions protect states with declining numbers of poor children from
reductions in their allocations, but in the absence of increased
overall funding, this leaves fewer funds available for states and
districts with growing numbers of poor children. Specific hold-harmless
rules have changed over time. In the authorizing statute, the hold-
harmless level for the basic and targeted grants is set at 85, 90, or
95 percent of the prior year‘s allocation, depending on the percentage
of children in the district who are eligible under the formula (formula
children). (The concentration grant does not have a hold-harmless
provision in the authorizing statute.) However, for the 1998-99, 1999-
2000, and 2000-01 school years, provisions in the appropriations
legislation set the hold-harmless level at 100 percent of the past
year‘s allocation.[Footnote 11] This 100-percent rule was modified for
school year 2001-02. Under this new rule, rather than being guaranteed
100 percent of their prior year‘s funding amount, districts were
guaranteed the larger of either their previous year‘s allotment or the
amount they would have received had the authorizing statute‘s hold-
harmless rules been in effect.[Footnote 12]
The Title I program was reauthorized in January 2002, with some
significant changes. See appendix III for details.
State Role in the Allocation Process:
A state‘s allocation is the sum of the district allocations determined
by Education. These allocations, however, are not the final amounts
that a district will receive. The state must adjust the allocations
determined by Education to:
* reserve funds for state administration (up to 1 percent of the amount
allocated to the state) and for school improvement activities (no more
than 0.5 percent of the amount allocated to the state but no less than
$200,000) and;
* account for changes in district boundaries, district consolidations,
and the creation or existence of special districts, such as charter
schools or regional vocational/technical schools, that are eligible for
Title I funds but may not be reflected in Education‘s allocations.
In the case of special districts that meet the basic and concentration
grant eligibility criteria, the state must ensure that those districts
receive the Title I funds to which they are entitled. This may involve
reducing the allocations of districts from which these special
districts draw children.
In addition, the statute gives states the flexibility to use
alternative poverty data, which Education must approve, to redistribute
Education-determined basic and concentration grant allocations and re-
determine eligibility for ’small“ districts serving areas with fewer
than 20,000 total residents. This provision arose out of concerns about
the quality of Census poverty estimates for small districts. Roughly 79
percent of all school districts nationally have a total resident
population of less than 20,000. Currently, nine states use alternative
data to redistribute allocations determined by Education among their
small districts. Most of these states use free and/or reduced-price
lunch data either exclusively or in combination with Census poverty
data.
Within District Allocation Process:
Once funds have been allocated to the district level, districts can in
turn allocate funds to the schools. Districts have considerable
discretion” more so than states”in how they allocate Title I funds.
Districts may use Title I funds for district-level activities”including
professional development, preschool programs, school improvement
initiatives, program administration, and parental involvement efforts.
Districts then generally allocate the remaining Title I dollars to the
schools. In distributing these dollars, districts are subject to
several key restrictions. For example, a district must serve eligible
schools or attendance areas in rank order according to their poverty
percentage.[Footnote 13] A district must serve those areas or schools
above 75 percent poverty, including any middle or high schools, before
it serves any with a poverty percentage below 75 percent. Once all of
the schools and areas with a percentage above 75 percent have been
served, the district may serve lower-poverty areas and schools either
by continuing with the districtwide ranking or by ranking its schools
below 75 percent poverty according to grade-span groupings (i.e., K-6,
7-9, 10-12). If a district ranks by grade-span, it can compare the
school‘s poverty percentage to either the districtwide poverty average
or the poverty average for the respective grade-span grouping.[Footnote
14]
Districts are not required to allocate the same per-pupil amount to
each school, but if they choose not to, they must allocate higher per-
pupil amounts to poorer schools than they allocate to schools with
lower concentrations of poverty. In addition, districts may apply for
and receive waivers of any of these allocation rules. The Title I
statute also requires that school districts provide eligible private
school children with Title I educational services or other benefits
that are ’equitable“ to those provided to eligible public school
children. The school district provides these services directly to the
private school children rather than giving funds to the private school
itself.[Footnote 15] Within the rules, districts may allocate funds to
schools as they like.
Distribution of School Districts by Size and Percentage of Poor
Children:
School districts differ in the size of their enrollment and their
percentages of poor children, as shown in figure 1. For example, there
are about 7,000 school districts with no more than 1,000 children
enrolled and about 300 districts with more than 20,000 children
enrolled. Among districts with less than 1,000 children, about half of
those districts have more than 35 percent of their children eligible
for free or reduced-price lunch, while the other half have fewer
children eligible for free or reduced-price lunch.
Figure 1: Distribution of School Districts by Size and Percentage of
Children in Poverty:
[Refer to PDF for image]
This figure is a stacked vertical bar graph depicting the following
data:
Small (the 7174 districts with fewer than 1000 children enrolled):
0-34% Poverty: 44%;
35-49% Poverty: 27%;
50-75% Poverty: 20%;
75-100% Poverty: 9%;
Total: 100%.
Medium (the 7121 districts districts with between 1000 and 20,000
children enrolled):
0-34% Poverty: 60%;
35-49% Poverty: 20%;
50-75% Poverty: 16%;
75-100% Poverty: 4%;
Total: 100%.
Large: (the 315 districts with at least 20,000 children enrolled):
0-34% Poverty: 38%;
35-49% Poverty: 24%;
50-75% Poverty: 29%;
75-100% Poverty: 9%;
Total: 100%.
Source: GAO Analysis.
[End of figure]
Allocations Based on Poverty, but Complex Allocation Process Results in
Different Allocations Per Poor Child Among States, Districts, and
Schools:
On the whole, total Title I grants were allocated to states and school
districts on the basis of their numbers of children from low-income
families in the 1999-2000 school year, but individual states and school
districts received different grant amounts for each poor child.
Generally, a state‘s share of poor children was roughly proportional to
its share of funds; however, even small differences between the two
resulted in substantial differences in funding per poor child. School
districts, like states, as a whole received Title I allocations that
were in accordance with the numbers of poor children they had enrolled,
but actual funding per poor child varied among individual school
districts with similar numbers of poor children. The pattern of Title I
grant distributions in terms of numbers of poor children among urban
and rural school districts is to some extent dependent upon the measure
of poverty that is used. When school districts allocated funds to
individual schools, they used the flexibility of the Title I program to
distribute funds where they believed the need was greatest. Even with
this flexibility, most school districts allocated the majority of funds
to schools in which at least half of the children were classified as
poor.
Title I Allocations Per Poor Child Differ Across States:
Generally, states with higher numbers of poor children received higher
amounts of Title I basic grant funds, and states with lower numbers of
poor children received lower amounts of Title I basic grant funds.
[Footnote 16] However, even small differences between a state‘s share
of poor children and its share of funds resulted in substantial
differences in funding per poor child. For example, in the 1999-2000
school year, Texas had about 10 percent of the nation‘s Census poor
children and received about 9 percent of the Title I basic grant
dollars while Minnesota had about 1 percent of the poor children and
1.2 percent of the dollars. However, Texas‘s share of the basic grants
was about 14 percent less than its share of the poor children while
Minnesota‘s share of the basic grants was about 16 percent more than
its share of the children. As a result, Texas‘s basic grants amounted
to $581 per poor child while Minnesota‘s basic grants amounted to $793
per poor child.[Footnote 17] Table 1 displays for each state and the
District of Columbia its share of Census poor children, share of basic
grant dollars, the percentage difference between these shares, and the
resulting basic grant amount per poor child.
Table 1: Distribution of Title I Basic Dollars to States, 1999-2000
School Year:
Percentage difference between share of poor children and share of basic
grant funds[B]:
State: Alabama;
Share of Census poor children: 2.02;
Share of basic grant funds[A]: 1.72;
Percentage difference between share of poor children and share of basic
grant funds[B]: -16.0;
Basic grant dollars per poor child: %571.
State: Alaska;
Share of Census poor children: 0.16;
Share of basic grant funds[A]: 0.25;
Percentage difference between share of poor children and share of basic
grant funds[B]: 43.9;
Basic grant dollars per poor child: $1,033.
State: Arizona;
Share of Census poor children: 2.02;
Share of basic grant funds[A]: 1.61;
Percentage difference between share of poor children and share of basic
grant funds[B]: -22.6;
Basic grant dollars per poor child: $561.
State: Arkansas;
Share of Census poor children: 1.28;
Share of basic grant funds[A]: 1.07;
Percentage difference between share of poor children and share of basic
grant funds[B]: -17.9;
Basic grant dollars per poor child: $534.
State: California;
Share of Census poor children: 14.69;
Share of basic grant funds[A]: 12.73;
Percentage difference between share of poor children and share of basic
grant funds[B]: 0-14.3;
Basic grant dollars per poor child: $581.
State: Colorado;
Share of Census poor children: 0.94;
Share of basic grant funds[A]: 0.97;
Percentage difference between share of poor children and share of basic
grant funds[B]: 3.1;
Basic grant dollars per poor child: $686.
State: Connecticut;
Share of Census poor children: 0.8;
Share of basic grant funds[A]: 0.94;
Percentage difference between share of poor children and share of basic
grant funds[B]: 16.1;
Basic grant dollars per poor child: $792.
State: Delaware;
Share of Census poor children: 0.18;
Share of basic grant funds[A]: 0.26;
Percentage difference between share of poor children and share of basic
grant funds[B]: 36.4;
Basic grant dollars per poor child: $972.
State: District of Columbia;
Share of Census poor children: 0.28;
Share of basic grant funds[A]: 0.34;
Percentage difference between share of poor children and share of basic
grant funds[B]: 19.4;
Basic grant dollars per poor child: $826.
State: Florida;
Share of Census poor children: 5.63;
Share of basic grant funds[A]: 4.87;
Percentage difference between share of poor children and share of basic
grant funds[B]: -14.5;
Basic grant dollars per poor child: $580.
State: Georgia;
Share of Census poor children: 3.28;
Share of basic grant funds[A]: 2.82;
Percentage difference between share of poor children and share of basic
grant funds[B]: -15.1;
Basic grant dollars per poor child: $577.
State: Hawaii;
Share of Census poor children: 0.28;
Share of basic grant funds[A]: 0.28;
Percentage difference between share of poor children and share of basic
grant funds[B]: 0;
Basic grant dollars per poor child: $662.
State: Idaho;
Share of Census poor children: 0.36;
Share of basic grant funds[A]: 0.31;
Percentage difference between share of poor children and share of basic
grant funds[B]: -14.9;
Basic grant dollars per poor child: $582.
State: Illinois;
Share of Census poor children: 3.9;
Share of basic grant funds[A]: 4.46;
Percentage difference between share of poor children and share of basic
grant funds[B]: 13.4;
Basic grant dollars per poor child: $767.
State: Indiana;
Share of Census poor children: 1.51;
Share of basic grant funds[A]: 1.61;
Percentage difference between share of poor children and share of basic
grant funds[B]: 6.4;
Basic grant dollars per poor child: $717.
State: Iowa;
Share of Census poor children: 0.67;
Share of basic grant funds[A]: 0.74;
Percentage difference between share of poor children and share of basic
grant funds[B]: 9.9;
Basic grant dollars per poor child: $746.
State: Kansas;
Share of Census poor children: 0.7;
Share of basic grant funds[A]: 0.75;
Percentage difference between share of poor children and share of basic
grant funds[B]: 6.9;
Basic grant dollars per poor child: $722.
State: Kentucky;
Share of Census poor children: 1.79;
Share of basic grant funds[A]: 1.72;
Percentage difference between share of poor children and share of basic
grant funds[B]: -4.0;
Basic grant dollars per poor child: $644.
State: Louisiana;
Share of Census poor children: 2.76;
Share of basic grant funds[A]: 2.57;
Percentage difference between share of poor children and share of basic
grant funds[B]: -7.1;
Basic grant dollars per poor child: $623.
State: Maine;
Share of Census poor children: 0.33;
Share of basic grant funds[A]: 0.42;
Percentage difference between share of poor children and share of basic
grant funds[B]: 24.0;
Basic grant dollars per poor child: $835.
State: Maryland;
Share of Census poor children: 1.16;
Share of basic grant funds[A]: 1.4;
Percentage difference between share of poor children and share of basic
grant funds[B]: 18.8;
Basic grant dollars per poor child: $806.
State: Massachusetts;
Share of basic grant funds[A]: 2.01;
Percentage difference between share of poor children and share of basic
grant funds[B]: 27.8;
Basic grant dollars per poor child: $885.
State: Michigan;
Share of Census poor children: 3.54;
Share of basic grant funds[A]: 4.42;
Percentage difference between share of poor children and share of basic
grant funds[B]: 22.1;
Basic grant dollars per poor child: $838.
State: Minnesota;
Share of Census poor children: 1.02;
Share of basic grant funds[A]: 1.2;
Percentage difference between share of poor children and share of basic
grant funds[B]: 16.2;
Basic grant dollars per poor child: $793.
State: Mississippi;
Share of Census poor children: 1.67;
Share of basic grant funds[A]: 1.7;
Percentage difference between share of poor children and share of basic
grant funds[B]: 1.8;
Basic grant dollars per poor child: $683.
State: Missouri;
Share of Census poor children: 1.93;
Share of basic grant funds[A]: 1.8;
Percentage difference between share of poor children and share of basic
grant funds[B]: -7.0;
Basic grant dollars per poor child: $625.
State: Montana;
Share of Census poor children: 0.36;
Share of basic grant funds[A]: 0.35;
Percentage difference between share of poor children and share of basic
grant funds[B]: -2.8;
Basic grant dollars per poor child: $662.
State: Nebraska;
Share of Census poor children: 0.36;
Share of basic grant funds[A]: 0.45;
Percentage difference between share of poor children and share of basic
grant funds[B]: 22.2;
Basic grant dollars per poor child: $849.
State: Nevada;
Share of Census poor children: 0.39;
Share of basic grant funds[A]: 0.32;
Percentage difference between share of poor children and share of basic
grant funds[B]: -19.7;
Basic grant dollars per poor child: $556.
State: New Hampshire;
Share of Census poor children: 0.16;
Share of basic grant funds[A]: 0.25;
Percentage difference between share of poor children and share of basic
grant funds[B]: 43.9;
Basic grant dollars per poor child: $556.
State: New Jersey;
Share of Census poor children: 1.92;
Share of basic grant funds[A]: 2.34;
Percentage difference between share of poor children and share of basic
grant funds[B]: 19.7;
Basic grant dollars per poor child: $816.
State: New Mexico;
Share of Census poor children: 1.15;
Share of basic grant funds[A]: 0.89;
Percentage difference between share of poor children and share of basic
grant funds[B]: -25.5;
Basic grant dollars per poor child: $520.
State: New York;
Share of Census poor children: 8.23;
Share of basic grant funds[A]: 9.8;
Percentage difference between share of poor children and share of basic
grant funds[B]: 17.4;
Basic grant dollars per poor child: $798.
State: North Carolina;
Share of Census poor children: 2.45;
Share of basic grant funds[A]: 1.99;
Percentage difference between share of poor children and share of basic
grant funds[B]: -20.7;
Basic grant dollars per poor child: $546.
State: North Dakota;
Share of Census poor children: 0.19;
Share of basic grant funds[A]: 0.26;
Percentage difference between share of poor children and share of basic
grant funds[B]: 31.1;
Basic grant dollars per poor child: $897.
State: Ohio;
Share of Census poor children: 3.5;
Share of basic grant funds[A]: 4.11;
Percentage difference between share of poor children and share of basic
grant funds[B]: 16.0;
Basic grant dollars per poor child: $786.
State: Oklahoma;
Share of Census poor children: 1.62;
Share of basic grant funds[A]: 1.3;
Percentage difference between share of poor children and share of basic
grant funds[B]: -21.9;
Basic grant dollars per poor child: $539.
State: Oregon;
Share of Census poor children: 0.81;
Share of basic grant funds[A]: 0.94;
Percentage difference between share of poor children and share of basic
grant funds[B]: 14.9;
Basic grant dollars per poor child: $777.
State: Pennsylvania;
Share of Census poor children: 33.59;
Share of basic grant funds[A]: 4.48;
Percentage difference between share of poor children and share of basic
grant funds[B]: 22.1;
Basic grant dollars per poor child: $837.
State: Rhode Island;
Share of Census poor children: 0.29;
Share of basic grant funds[A]: 0.34;
Percentage difference between share of poor children and share of basic
grant funds[B]: 15.9;
Basic grant dollars per poor child: $799.
State: South Carolina;
Share of Census poor children: 1.68;
Share of basic grant funds[A]: 1.35;
Percentage difference between share of poor children and share of basic
grant funds[B]: -21.8;
Basic grant dollars per poor child: $540.
State: South Dakota;
Share of Census poor children: 0.29;
Share of basic grant funds[A]: 0.26;
Percentage difference between share of poor children and share of basic
grant funds[B]: -10.9;
Basic grant dollars per poor child: $612.
State: Tennessee;
Share of Census poor children: 1.9;
Share of basic grant funds[A]: 1.74;
Percentage difference between share of poor children and share of basic
grant funds[B]: -8.8;
Basic grant dollars per poor child: $613.
State: Texas;
Share of Census poor children: 10.41;
Share of basic grant funds[A]: 9.01;
Percentage difference between share of poor children and share of basic
grant funds[B]: -14.4;
Basic grant dollars per poor child: $581.
State: Utah;
Share of Census poor children: 0.41;
Share of basic grant funds[A]: 0.47;
Percentage difference between share of poor children and share of basic
grant funds[B]: 13.6;
Basic grant dollars per poor child: $775.
State: Vermont;
Share of Census poor children: 0.14;
Share of basic grant funds[A]: 0.24;
Percentage difference between share of poor children and share of basic
grant funds[B]: 52.6;
Basic grant dollars per poor child: $1,150.
State: Virginia;
Share of Census poor children: 1.87;
Share of basic grant funds[A]: 1.58;
Percentage difference between share of poor children and share of basic
grant funds[B]: -16.8;
Basic grant dollars per poor child: $568.
State: Washington;
Share of Census poor children: 1.44;
Share of basic grant funds[A]: 1.49;
Percentage difference between share of poor children and share of basic
grant funds[B]: 3.4;
Basic grant dollars per poor child: $695.
State: West Virginia;
Share of Census poor children: 0.9;
Share of basic grant funds[A]: 0.99;
Percentage difference between share of poor children and share of basic
grant funds[B]: 9.5;
Basic grant dollars per poor child: $741.
State: Wisconsin;
Share of Census poor children: 1.36;
Share of basic grant funds[A]: 1.81;
Percentage difference between share of poor children and share of basic
grant funds[B]: 28.4;
Basic grant dollars per poor child: $891.
State: Wyoming;
Share of Census poor children: 0.14;
Share of basic grant funds[A]: 0.23;
Percentage difference between share of poor children and share of basic
grant funds[B]: 48.7;
Basic grant dollars per poor child: $1,131.
U.S. total or average:
Share of Census poor children: 100;
Share of basic grant funds[A]: 100;
Percentage difference between share of poor children and share of basic
grant funds[B]: 6.7;
Basic grant dollars per poor child: $671.
[A] Basic grant amounts are the sum of those the state reported
allocating to their districts and do not include amounts states
reserved for administration or school improvements.
[B] Percentage differences calculated as follows: 100* [(poverty
share - dollar share)/((poverty share + dollar share)/2)].
Source: GAO Analysis.
[End of table]
The shares of basic grant dollars that states received differed from
their shares of poor children due to the factors in addition to the
number of poor children that are included in the federal funding
formula: state per-pupil expenditures, the small state minimum
provision and the hold-harmless provision. For example, Vermont,
Wyoming, New Hampshire, and Alaska, which each received much larger
basic grants per poor child than the rest of the states, are each also
among the small-population states that benefited from the small state
minimum provision in the 1999-2000 school year. Another of the formula
factors ” the state per-pupil expenditures factor ” also had an
important impact on the distribution of Title I dollars to states.
States with higher percentages of poor children would be expected, all
else being equal, to have lower tax bases and tend to have lower state
education expenditures. As a result, states with higher percentages of
poor children tended to receive smaller basic grant amounts per poor
child because Title I allocations are based, in part, on the amount a
state spends on education. We found that of the 17 states with more
than 20 percent of their children living in poverty in 1997, all but 4
had basic grant dollars per poor child below the national average in
the 1999-2000 school year.
Title I Allocations Were Made in Accordance With Numbers of Poor
Children, But Amounts Per Poor Child Differed Across School Districts:
An examination of the allocations that states reported making to their
school districts in the 1999-2000 school year shows that school
districts, like states, as a whole received Title I allocations that
were in accordance with the numbers of poor children they had enrolled,
but that actual funding per poor child varied considerably among
individual school districts with similar numbers of poor children.
[Footnote 18] For example, among districts with between 101 and 250
children eligible for free or reduced-price lunch, the median basic
grant funding per poor child was $370, but ranged from $0 to $2,573.
Concentration grants among school districts with similar numbers of
poor children also varied. For example, among districts receiving
concentration grants with between 101 and 250 children eligible for
free or reduced-price lunch, the median concentration grant funding per
poor child was $63, but ranged from $1 to $3,547. Figures 2 and 3
illustrate these findings. The variation illustrated for the national
level in figures 2 and 3 is similar to the type of variation that
occurs within states as well. In other words, within states, individual
districts with similar numbers of children received different
allocation amounts.
Figure 2: Basic Grant Dollars Per Poor Child in Districts With 100 to
250 Children Eligible for Free or Reduced-Price Lunch, 1999-2000:
[Refer to PDF for image]
This figure is a vertical bar graph depicting basic grant dollars per
poor child in districts with 100 to 250 children eligible for free or
reduced-price lunch, 1999-2000. The vertical axis of the graph
represents number of school districts. The horizontal axis of the graph
represents dollars per poor child.
Standard deviation = 229.57;
Median = $370;
Total number of school districts: 3061.
Source: GAO Analysis.
[End of figure]
Figure 3: Concentration Grant Dollars Per Poor Child in Districts with
100-250 Children Eligible for Free or Reduced-Price Lunch, 1999-2000:
[Refer to PDF for image]
This figure is a vertical bar graph depicting concentration grant
dollars per poor child in districts with 100-250 children eligible for
free or reduced-price lunch, 1999-2000. The vertical axis of the graph
represents number of school districts. The horizontal axis of the graph
represents dollars per poor child.
Standard deviation = 52.37;
Median = $63;
Total number of school districts: 1354.
Source: GAO Analysis.
[End of figure]
Not only did districts with similar numbers of poor children receive
different allocations per poor child, but also in some cases, school
districts with larger numbers of poor children received less funding
per poor child than districts with smaller numbers of poor children.
For example, in California, one school district with 961 poor children
received a basic grant of $363 per poor child, while a school district
with 13 poor children received $1,656 per poor child.[Footnote 19]
Concentration grants for these two districts varied similarly and
similar examples of variation occurred in most states. Differences in
Title I funding per poor child among school districts is due, in part,
to hold-harmless provisions.
Allocations Among Urban and Rural School Districts Vary Slightly From
Their Numbers of Census Poor Children:
The pattern of Title I grant distributions in terms of numbers of poor
children among urban and rural school districts in the 1999-2000 school
year is to some extent dependent upon the measure of poverty that is
used, as shown in table 2.[Footnote 20] When Census data are used as
the measure of poverty, both urban and rural school districts as a
whole received shares of both basic and concentration grants roughly
proportional to their share of poor children, with some small
differences.[Footnote 21] However, when eligibility for free or reduced-
price lunch is used as the measure of poverty, urban districts received
shares of both basic and concentration grants that were greater than
their share of poor children.
Table 2: Distribution of Basic and Concentration Grant Allocations
Among Urban and Rural School Districts, 1999-2000 School Year:
Basic grants: Urban districts;
Percentage share of basic grants allocated: 48%;
Percentage share of Census poor children: 48%;
Percentage share of children eligible for free or reduced-price lunch:
44%.
Basic grants: Rural districts;
Percentage share of basic grants allocated: 16%;
Percentage share of Census poor children: 15%;
Percentage share of children eligible for free or reduced-price lunch:
16%.
Basic grants: Other districts;
Percentage share of basic grants allocated: 36%;
Percentage share of Census poor children: 37%;
Percentage share of children eligible for free or reduced-price lunch:
40%.
Basic grants: Total:
Percentage share of basic grants allocated: 100%;
Percentage share of Census poor children: 100%;
Percentage share of children eligible for free or reduced-price lunch:
100%.
Concentration grants: Urban districts;
Percentage share of basic grants allocated: 58%;
Percentage share of Census poor children: 56%;
Percentage share of children eligible for free or reduced-price lunch:
53%.
Concentration grants: Rural districts;
Percentage share of basic grants allocated: 13%;
Percentage share of Census poor children: 14%;
Percentage share of children eligible for free or reduced-price lunch:
14%.
Concentration grants: Other districts;
Percentage share of basic grants allocated: 29%;
Percentage share of Census poor children: 30%;
Percentage share of children eligible for free or reduced-price lunch:
33%.
Concentration grants: Total;
Percentage share of basic grants allocated: 100%;
Percentage share of Census poor children: 100%;
Percentage share of children eligible for free or reduced-price lunch:
100%.
Note: Analysis considered only those districts for which both free and
reduced-price lunch and Census poverty data were available. Four
states, Florida, Hawaii, Maryland, and West Virginia, with state or
county-based school districts, were excluded from the analysis because
of the imprecision of their location codes.
[A] Concentration grant analysis includes only those districts that are
eligible for concentration grants and the children in those districts.
Source: GAO Analysis.
[End of table]
Even small differences between shares of grants and shares of poor
children resulted in per child dollar differences between urban and
rural districts. For example, when Census data are used as the measure
of poverty, rural districts overall had a higher median basic grant
amount per poor child ($705) than did urban districts ($610). This
resulted, in part, because the share of basic grants that rural
districts received was 1 percentage point greater than their share of
poor children while the share of basic grants that urban districts
received was equivalent to their share of children. Because the pattern
of Title I grant distributions among urban and rural school districts
is dependent on the measure of poverty used, it is worth noting that
currently all states base their allocations on Census data for areas
with populations greater than 20,000 residents, and the overwhelming
majority of states (41) base their allocations on Census data rather
than subsidized lunch for areas with populations smaller than 20,000
residents.
Funding Per Poor Child for Charter Schools Is Less Than That for Other
Districts Comparable in Size:
Title I allocations to charter schools that are independent school
districts are lower than per-pupil allocations to other similarly sized
school districts.[Footnote 22] Charter schools are not included in
Education‘s Title I formula calculations, but are guaranteed funding on
an equal basis with other school districts. Consequently, those states
with independent charter schools must reallocate resources from other
school districts to these schools. In the 1999-2000 school year, 14
states and the District of Columbia had operating charter schools that
were considered independent school districts; 533 of these 734 charter
schools received basic grants.[Footnote 23] In these states combined,
charter school districts that received Title I grants had almost 6
percent of the children receiving free or reduced-price lunch and
received less than 5 percent of the basic grant funding that was
distributed to districts with fewer than 2,500 students. Average basic
grant funding per poor child in the charter school districts was $365
and was $481 in the other school districts.
School Districts Use the Flexibility of the Title I Program When
Allocating Funds to Eligible Schools, and the Majority of Title I Funds
go to High-Poverty Schools:
When school districts allocate funds to individual schools, they use
the flexibility of the Title I program to distribute funds where they
believe the need is greatest and in ways that they believe best
provides needed activities efficiently and consistently. Unlike school
district allocations, which are based on numbers of poor children,
allocations to individual schools are required by law to be based on
the percentages of poor children within grade span or within the
district as a whole.[Footnote 24] From our national survey of school
districts, we estimate that a majority of school districts (63 percent)
prioritized Title I funding to eligible primary or elementary grades
before funding other grade spans, while an estimated 23 percent of
school districts prioritized funds to schools with higher percentages
of poor children, regardless of grade span. (See fig. 4.) A similar
pattern was found among rural districts, of which an estimated 67
percent targeted funds to needy primary schools. In contrast, equal
percentages of urban school districts targeted funds to primary schools
(an estimated 42 percent) and to schools with higher percentages of
poor children (an estimated 42 percent).[Footnote 25]
Figure 4: Title I Allocation Priorities of School Districts by
Location:
[Refer to PDF for image]
This figure is a stacked vertical bar graph depicting the following
data:
All school districts:
Primary grades: 63%;
Poverty ranking: 23%;
Other priorities: 15%.
Urban school districts:
Primary grades: 42%;
Poverty ranking: 42%;
Other priorities: 17%.
Rural school districts:
Primary grades: 67%;
Poverty ranking: 17%;
Other priorities: 16%.
Note: School district officials self-identified their districts as
urban, rural, suburban, or mixed. As a result, the urban and rural
designations in figure 4 are not comparable to those in table 2.
Source: GAO Analysis.
[End of figure]
In addition to distributing funds to individual schools, we estimate
that over half the districts (58 percent) reserve at least some of
their Title I grant, typically no more than 10 percent, for
administration or other district activities. An estimated 61 percent of
districts that reserve funds for such purposes do so because they
believe it is more efficient or promotes consistency across schools in
the district. Districts use the reserved funds for such activities as
professional development for teachers, parental involvement programs,
preschool and summer school programs, and before and after school
enrichment activities.[Footnote 26]
In addition to the flexibility districts are allowed under the Title I
regulations, a district may apply for a waiver from the regulations if
a district finds that it cannot use Title I funds to best serve the
needs of its schools within the existing regulations.[Footnote 27]
Waivers are used most commonly to allow districts to (1) serve schools
of the same grade span without regard for their rank order in terms of
poverty or (2) allow lower-poverty schools to use Title I funds in
schoolwide programs rather than for specific students, a practice
otherwise allowed only in schools with greater than 50 percent of their
children living in poverty.
Because districts have flexibility in making Title I allocations to
schools, and not all schools with poor children receive funds from
their districts, the amount of Title I funds that individual schools
receive per poor child differs among schools. Only three states,
California, Mississippi, and Georgia, were able to provide us with
electronic information on enrollment, free and reduced-price lunch
eligibility, and Title I dollar amounts allocated to individual
schools. Analyses of these three states‘ data show that in the 1999-
2000 school year, among the schools receiving Title I funds, schools
with higher percentages of poor children received a larger percentage
of the funds than schools with lower percentages of poor children, as
shown in table 3. Although these findings are based on one year of data
from only three states, they are consistent with Education‘s findings
that in the 1997-98 school year, nationally 66 percent of schools
receiving Title I funds had more than 50 percent of their children
eligible for free or reduced-price lunch, and 35 percent of schools
receiving Title I funds had at least 75 percent of their children
eligible for free or reduced-price lunch.
Table 3: Distribution of Title I Schools, Title I Funds, and Children
in Title I Schools by School‘s Percentage of Poor Children, 1999-2000
School Year:
School poverty level: California;
0-34% poverty:
Percentage of Title I schools: 15%;
Percentage of Title I funds allocated to schools: 6%;
Percentage of poor children in Title I schools[A]: 4%.
35-49% poverty:
Percentage of Title I schools: 15%;
Percentage of Title I funds allocated to schools: 9%;
Percentage of poor children in Title I schools[A]: 9%.
50-74% poverty:
Percentage of Title I schools: 31%;
Percentage of Title I funds allocated to schools: 29%;
Percentage of poor children in Title I schools[A]: 30%.
75-100% poverty:
Percentage of Title I schools: 39%;
Percentage of Title I funds allocated to schools: 56%;
Percentage of poor children in Title I schools[A]: 57%.
Total:
Percentage of Title I schools: 100%;
Percentage of Title I funds allocated to schools: 100%;
Percentage of poor children in Title I schools[A]: 100%.
School poverty level: Georgia;
0-34% poverty:
Percentage of Title I schools: 6%;
Percentage of Title I funds allocated to schools: 2%;
Percentage of poor children in Title I schools[A]: 3%.
35-49% poverty:
Percentage of Title I schools: 18%;
Percentage of Title I funds allocated to schools: 13%;
Percentage of poor children in Title I schools[A]: 14%.
50-74% poverty:
Percentage of Title I schools: 44%;
Percentage of Title I funds allocated to schools: 43%;
Percentage of poor children in Title I schools[A]: 44%.
75-100% poverty:
Percentage of Title I schools: 33%;
Percentage of Title I funds allocated to schools: 42%;
Percentage of poor children in Title I schools[A]: 39%.
Total 100 100
Percentage of Title I schools: 100%;
Percentage of Title I funds allocated to schools: 100%;
Percentage of poor children in Title I schools[A]: 100%.
School poverty level: Mississippi;
0-34% poverty:
Percentage of Title I schools: 0.4%;
Percentage of Title I funds allocated to schools: 0.3%;
Percentage of poor children in Title I schools[A]: 0.2%.
35-49% poverty:
Percentage of Title I schools: 9%;
Percentage of Title I funds allocated to schools: 6%;
Percentage of poor children in Title I schools[A]: 7%.
50-74% poverty:
Percentage of Title I schools: 38%;
Percentage of Title I funds allocated to schools: 31%;
Percentage of poor children in Title I schools[A]: 33%.
75-100% poverty:
Percentage of Title I schools: 52%;
Percentage of Title I funds allocated to schools: 63%;
Percentage of poor children in Title I schools[A]: 59%.
Total:
Percentage of Title I schools: 100%;
Percentage of Title I funds allocated to schools: 100%;
Percentage of poor children in Title I schools[A]: 100%.
Note: Amounts may not sum to 100 percent due to rounding.
[A] Poor children are defined as children eligible for free or reduced-
price lunch.
Source: GAO analysis.
[End of table]
Allocations Do Not Fully Adjust to Geographic Shifts in the Number of
Children From Low-Income Families:
When the number of poor children from low-income families shifts
between states, Title I allocations do not fully adjust in response.
[Footnote 28] More frequent updates of Census poverty data over the
past decade have provided Education the data it needs to adjust Title I
formula calculations to shifts in poverty more quickly than it could in
the past. However, recent appropriations hold-harmless provisions and
the small state minimum provision in the formula have limited the
extent to which Title I allocations can shift at all, even when
Education has data indicating that shifts in poverty have occurred.
Even if these rules were changed, allowing formula calculations to be
based more completely on poverty, the remaining lags in Census poverty
data would continue to prevent Title I formula calculations from fully
adjusting to shifts in poverty.
When Poverty Has Shifted Among States, Allocations Have Not Fully
Adjusted:
To the extent that the number of poor children among the states has
shifted, Title I funding has not completely adjusted in response. For
example, in 1980, California had 9 percent of the nation‘s poor
children and received 10 percent of all Title I dollars. By 1997,
California had 16 percent of the nation‘s poor children, but received
just 12 percent of all Title I dollars. This type of disparity has
occurred in a number of states. In 1997, 33 states received Title I
allocations that differed from their shares of poor children by more
than 10 percent.
Census Is Updating Poverty Data More Frequently:
A lack of updated poverty data contributed to the mismatch between
poverty and funding over the last two decades. Education relied on 1980
decennial Census data to make allocations from 1984 to 1993, at which
point Education began using 1990 decennial Census data to adjust
allocations. As shown in table 4, since 1990, the lag in poverty data
has decreased. This decrease occurred, in part, because in 1994, the
Congress authorized the Census Bureau to update the data more
frequently.
Table 4: Use of Poverty Updates in Title I Formula Calculations:
Year of decennial poverty data or update: 1979;
School year(s) in which updated data were used in formula calculations:
1984-85 through 1992-93.
Year of decennial poverty data or update: 1989;
School year(s) in which updated data were used in formula calculations:
1993-94 through 1996-97.
Year of decennial poverty data or update: 1993;
School year(s) in which updated data were used in formula calculations:
1997-98 through 1998-99.
Year of decennial poverty data or update: 1995;
School year(s) in which updated data were used in formula calculations:
1999-2000 through 2000-01.
Year of decennial poverty data or update: 1997;
School year(s) in which updated data were used in formula calculations:
2001-02.
Source: GAO Analysis.
[End of table]
Hold-Harmless and Small State Minimum Provisions Limit Shifts in Title
I Allocations Despite Updated Data:
Although the Census updates provided Education with more timely poverty
estimates, the hold-harmless and small state minimum provisions limited
the extent to which Title I formula allocations could change in
response. These provisions limit the extent to which Title I grants are
reduced for districts and small-population states with declining
numbers of poor children. As a result, funds are not sufficient to
provide ’full“ formula amounts to districts and states with increasing
numbers of poor children.[Footnote 29] Because of the effects of the
hold-harmless and small state minimum provisions, between school years
2000-01 and 2001-02, holding other things constant,[Footnote 30] most
states with increased numbers of poor children would have received a
decreased Title I allocation per poor child, while most states with
decreased numbers of poor children would have received an increased
Title I allocation per poor child.[Footnote 31] States with increased
numbers of poor children would have lost an average of $25 per poor
child under the basic grant and $10 per poor child under the
concentration grant.[Footnote 32] States with decreasing numbers of
poor children between these 2 years would have gained $23 per poor
child under the basic grant and $4 per child under the concentration
grant.[Footnote 33]
While the hold-harmless and, to a lesser extent, small state minimum
provisions create imbalances between poverty and funding, in the
absence of these provisions, unavoidable lags in poverty data would
prevent Education from fully adjusting Title I allocations to shifts in
poverty.
Allocations Do Not Encourage States To Target Their Own Funds To
Children From Low-Income Families:
Title I allocations do not encourage states to target their own funds
to children from low-income families. Our review of the Title I statute
and regulations found no formal monetary, statutory, or regulatory
incentives for states to target their funds in this way. In our
interviews with Title I directors in each of the 50 states, only four
reported that they have programs for disadvantaged children that model
their eligibility criteria on the Title I program. Furthermore, our
study[Footnote 34] based on 1991-92 school year data found large
differences in the extent to which state funding was targeted to school
districts on the basis of poverty criteria, indicating that states were
not systematically following the allocation model of the Title I
program.
The incentive grant, if funded, could provide an incentive for states
to spend more of their own dollars. However, the grant would not
encourage states to target their own funds to children from low-income
families. In addition, the amount of money that could be provided
through an incentive grant is not likely to be sufficient to create
changes in states‘ behaviors.
Using Less Restrictive Hold-Harmless Provisions, Revising Grant
Formulas, or Raising Eligibility Threshold Could Shift Funds Toward
Poorer Districts and/or Reduce Funding Variations Among Districts:
A number of policy options could affect the extent to which Title I
funds are allocated to states and school districts with greater numbers
and percentages of children from low-income families. First, using a
less restrictive hold-harmless provision would reduce the variation in
funding among school districts with similar numbers and similar
percentages of poor children and allocate more funding to states with
more rapidly growing numbers of poor children. Second, funding targeted
grants and raising the basic grant eligibility thresholds would each
shift funding toward districts with higher percentages of poor children
and away from districts with lower percentages of poor children. Third,
replacing the measure of state per-pupil expenditures with an
alternative cost indicator would also have the effect of shifting
funding to districts with higher percentages of poor children and
reducing the variation in funding among districts with similar
percentages of poor children. The effect of such changes would depend
on the appropriations provisions. The effect of the changes would also
depend on adjustments to the formula-calculated amounts made by state
officials. Each policy option involves trade-offs between the competing
goals of providing similar funding amounts to districts with similar
numbers and percentages of poor children and providing stable funding
to districts with rapidly declining numbers and percentages of poor
children. Without increases in total funding, each change also would
increase funds for some districts while decreasing funds for others.
Using Less Restrictive Hold-Harmless Rules Would Decrease the Variation
in Funding Among Districts With Similar Numbers and Percentages of Poor
Children:
Different hold-harmless rules affect the extent to which Title I
funding is allocated on the basis of numbers of poor children. The less
restrictive the hold-harmless rules are, all else equal, the more Title
I funding would be allocated on the basis of numbers of poor children.
We considered four possible hold-harmless rules. In order from most to
least restrictive, they were:
* a 100-percent hold-harmless rule (districts receive 100 percent of
their previous year‘s allocation);
* the school year 2001-02 hold-harmless rule (districts guaranteed the
larger of either their previous year‘s allocation or the amount they
would have received had the authorizing statute‘s hold-harmless rule
been in effect);
* the authorizing statute‘s hold-harmless rule (districts receive 85,
90, or 95 percent of the previous year‘s allocation, depending on the
percentage of children in the district who are eligible under the Title
I formula); and:
* no hold-harmless rule (districts receive allocations based on current
application of the Title I formula with no regard to the previous
year‘s allocation).
Using a less restrictive hold-harmless rule would not noticeably
redistribute funding between school districts with large and small
numbers of poor (formula) children. However, less restrictive hold-
harmless rules would substantially reduce the funding variation among
the smallest districts with similar numbers of poor children.
Disparities in funding are greatest under the 100-percent hold-harmless
rule, less under the 2001-02 rule, further reduced under the
authorizing statute and would be the least if there were no hold-
harmless, as shown in table 5 for both small and large districts, in
terms of their numbers of formula children.[Footnote 35]
Table 5: Percentage Differences in Average Funding Variation Under
Alternative Hold-Harmless Rules Compared With a 100-Percent Rule:
Dollars per poor child:
Hold-harmless rule: 100-Percent rule: Average funding;
Smallest districts (the 10,929 districts with up to 643 formula
children each): $841;
Largest districts (the 29 districts with more than 26,976 formula
children each): $814.
Hold-harmless rule: 100-Percent rule: Average variation;
Smallest districts (the 10,929 districts with up to 643 formula
children each): $277;
Largest districts (the 29 districts with more than 26,976 formula
children each): $213.
Hold-harmless rule: 2001-02 rule: Average variation;
Smallest districts (the 10,929 districts with up to 643 formula
children each): $270;
Largest districts (the 29 districts with more than 26,976 formula
children each): $209.
Hold-harmless rule: 2001-02 rule: Percentage difference;
Smallest districts (the 10,929 districts with up to 643 formula
children each): -2%;
Largest districts (the 29 districts with more than 26,976 formula
children each): -2%.
Hold-harmless rule: Authorizing statute: Average variation;
Smallest districts (the 10,929 districts with up to 643 formula
children each): $172;
Largest districts (the 29 districts with more than 26,976 formula
children each): $205.
Hold-harmless rule: Authorizing statute: Percentage difference;
Smallest districts (the 10,929 districts with up to 643 formula
children each): -38%;
Largest districts (the 29 districts with more than 26,976 formula
children each): -4%.
Hold-harmless rule: No hold-harmless: Average variation;
Smallest districts (the 10,929 districts with up to 643 formula
children each): $130;
Largest districts (the 29 districts with more than 26,976 formula
children each): $202.
Hold-harmless rule: No hold-harmless: Percentage difference;
Smallest districts (the 10,929 districts with up to 643 formula
children each): -53%;
Largest districts (the 29 districts with more than 26,976 formula
children each): -5%.
Source: GAO Analysis.
Using a less restrictive hold-harmless rule would also have the effect
of reducing variation among districts with similar percentages of poor
children. (See fig. 5.)
Figure 5: Variation in Funding Per Child Under Alternative Hold-
Harmless Rules (Districts Grouped by Percentage of Poor Children):
[Refer to PDF for image]
This figure is a multiple line graph. The vertical axis of the graph
represents percent variation. The horizontal axis of the graph
represents children grouped by percentage of poor children in their
school districts, from lowest to highest. The following alternatives
are depicted:
FY 2001 hold-harmless;
100-Percent hold-harmless;
Authorizing hold-harmless;
No hold-harmless.
Source: GAO Analysis.
[End of figure]
Using a less restrictive hold-harmless provision distributes more funds
to high-growth school districts and accordingly to high-growth states.
The effect of using a less restrictive hold-harmless rule would be to
increase the responsiveness of Title I funding to the growth in numbers
of poor children in states. In figure 6, states are rank-ordered based
on the growth in the number of formula-eligible children between school
years 2000-01 and 2001-02.[Footnote 36] Figure 6 shows the percent
change in funding that would have resulted had no hold-harmless rule
been in effect. Under the no hold-harmless scenario, 12 of the 15
states with the highest growth in low-income children would have
received more funding and 13 of the 15 slowest growth states would have
received less.[Footnote 37] Appendix II shows the data on which figure
6 is based.
Figure 6: Percentage Change in Funding With No Hold-Harmless Rule
(States Ranked by Percentage Growth in the Number of Poor Children):
[Refer to PDF for image]
This figure is a horizontal bar graph. The vertical axis of the graph
represents percent changes in state poverty from -19.9 to +39.6. The
horizontal axis of the graph represents percent change in funding from -
30.0 to +15.0.
Source: GAO analysis.
[End of figure]
Distributing Funds Through the Targeted Grants Would Increase the
Extent to Which Title I Funds Are Allocated to Areas With High Numbers
and Percentages of Poor Children:
Funding targeted grants instead of concentration grants would provide
noticeably more Title I funds to districts with both higher numbers and
percentages of poor children and reduce funding for districts with
lower numbers and percentages of poor children. Districts are eligible
for concentration grants if they have more than 6,500 poor children or
the number of poor children is more than 15 percent of the district‘s
school-age children. Concentration grants are allocated to eligible
districts based on their numbers of poor children. In contrast,
districts would be eligible for targeted grants if they had at least 10
poor children and these children accounted for at least 5 percent of
their school-age children. As the number and percentage of poor
children in the district increase, the targeted grant amount would
increase both in absolute dollars and proportionally to other
districts.
In the 2001-02 school year, districts with the highest percentages of
poor children received $864 per poor child compared with $758 per poor
child in districts with the lowest percentages of poor children. If
targeted grants had been funded instead of concentration grants, the
funding for districts with the highest percentages of poor children
would have increased by 5.5 percent, to $912 per poor child, while the
funding for districts with the lowest percentages of poor children
would have decreased by 5.7 percent, to $714, as shown in table 6.
Table 6 also shows that funding targeted grants would have a similar
effect on districts with larger and smaller numbers of poor children.
Table 6: Funding Per Poor Child Under Current Law and Under a Policy
Option That Funds Targeted Grants Instead of Concentration Grants:
Poverty group by percentage of children:
Formula option: 2001 formula-calculated amount: Dollars per poor child;
Lowest (no more than 15% poverty): $758;
Low (15-21% poverty): $821;
Medium (21-29% poverty): $826;
High (29-40% poverty): $865;
Highest (40-100% poverty): $864;
Ratio (highest to lowest): 114%.
Formula option: Formula-calculated amount with targeted grant: Dollars
per poor child;
Lowest (no more than 15% poverty): $714;
Low (15-21% poverty): $808;
Medium (21-29% poverty): $820;
High (29-40% poverty): $877;
Highest (40-100% poverty): $912;
Ratio (highest to lowest): 128%.
Formula option: Formula-calculated amount with targeted grant:
Percentage difference;
Lowest (no more than 15% poverty): -5.7%;
Low (15-21% poverty): -1.6%;
Medium (21-29% poverty): -0.7%;
High (29-40% poverty): +1.4%;
Highest (40-100% poverty): +5.5%.
Poverty group by numbers of children in poverty:
Formula option: 2001 formula-calculated amount: Dollars per poor child;
Lowest (1 to 643 formula children): $842;
Low (643-2,020 formula children): $797;
Medium (2.021 to 6,698 formula children): $784;
High (6,709 to 26,844 formula children): $821;
Highest (26,976 to 303,122 formula children): $814;
Ratio to lowest): 97%.
Formula option: Formula-calculated amount with targeted grant: Dollars
per poor child;
Lowest (1 to 643 formula children): $815;
Low (643-2,020 formula children): $785;
Medium (2.021 to 6,698 formula children): $771;
High (6,709 to 26,844 formula children): $812;
Highest (26,976 to 303,122 formula children): $946;
Ratio to lowest): 116%.
Formula option: Formula-calculated amount with targeted grant:
Percentage difference;
Lowest (1 to 643 formula children): -3.1%;
Low (643-2,020 formula children): -1.6%;
Medium (2.021 to 6,698 formula children): -1.6%;
High (6,709 to 26,844 formula children): -1.1%;
Highest (26,976 to 303,122 formula children): +16.3%.
Source: GAO Analysis.
[End of table]
Alternative Cost Indicator Would Direct More Funding to Districts With
Higher Percentages of Poor Children and Reduce Funding Disparities
Among These Districts:
The per-pupil expenditure factor was originally included in the Title I
formulas to take into account cross-state differences in the cost of
providing education services. While per-pupil expenditures reflect the
cost of providing education services to some extent, expenditures are
also explained by other factors not related to costs. For example,
states with high-income taxpayers may spend more on education than
those whose taxpayers have lower incomes.[Footnote 38] In addition,
spending differences may result from differences in the ’willingness“
of a state‘s taxpayers to fund public education.[Footnote 39]
One alternative cost measure is a geographical cost-of-education index
developed for the Department of Education‘s Office of Educational
Research and Improvement.[Footnote 40] The purpose of this experimental
cost index is to make cost comparisons based on the cost of teachers,
non-teaching school personnel, and other factors that may affect costs,
but which are beyond the ability of local officials to control.
[Footnote 41] The index includes cost factors for both states and
school districts, unlike earlier experimental measures that had only
cross-state cost factors. We use these cost factors for illustrative
purposes only and do not necessarily endorse any particular measure.
The intent of replacing state per-pupil expenditures with either a
state or district-level cost-of-education factor is to more accurately
reflect educational costs; however, as a by-product, doing so would
shift funding somewhat toward districts with higher percentages of poor
children. If the state per-pupil expenditure factor had been replaced
with a cost factor in the 2001-02 school year, districts with the
highest percentages of poor children would have seen an increase in
funding of approximately 3 percent, while districts with the lowest
percentages of poor children would have seen a decrease in funding of 2
to 3 percent (see table 7). If in addition, the authorizing statute‘s
hold-harmless rules had been adopted, funding to districts with the
highest percentages of poor children would have increased by about 5
percent while funding in districts with the lowest percentages of poor
children would have decreased by about 5 percent.[Footnote 42]
Table 7: Funding Per Poor Child Under Current Law and Formula Options
That Replace State Per-Pupil Expenditure Factor With a Teacher Cost
Factor:
Poverty group by percentage of children in poverty:
2001 formula allocation: Dollars per child;
Lowest (no more than 15% poverty): $758;
Low (15-21% poverty): $821;
Medium (21-29% poverty): $826;
High (29-40% poverty): $865;
Highest (40-100% poverty): $864;
Ratio (highest to lowest): 114%.
State cost factor: Dollars per child;
Lowest (no more than 15% poverty): $737;
Low (15-21% poverty): $815;
Medium (21-29% poverty): $825;
High (29-40% poverty): $866;
Highest (40-100% poverty): $892;
Ratio (highest to lowest): 121%.
State cost factor: Percentage difference;
Lowest (no more than 15% poverty): -2.7%;
Low (15-21% poverty): -0.8%;
Medium (21-29% poverty): 0.0;
High (29-40% poverty): 0.1%;
Highest (40-100% poverty): 3.3%.
District cost factor: Dollars per child;
Lowest (no more than 15% poverty): $746;
Low (15-21% poverty): $815;
Medium (21-29% poverty): $821;
High (29-40% poverty): $866;
Highest (40-100% poverty): $887;
Ratio (highest to lowest): 119%.
District cost factor: Percentage difference;
Lowest (no more than 15% poverty): -1.6%;
Low (15-21% poverty): -0.8%;
Medium (21-29% poverty): -0.5%;
High (29-40% poverty): 0.1%;
Highest (40-100% poverty): 2.7%.
District cost factor & authorizing hold-harmless: Dollars per child;
Lowest (no more than 15% poverty): $716;
Low (15-21% poverty): $818;
Medium (21-29% poverty): $818;
High (29-40% poverty): $873;
Highest (40-100% poverty): $905;
Ratio (highest to lowest): 126%.
District cost factor & authorizing hold-harmless: Percentage
difference;
Lowest (no more than 15% poverty): -5.4%;
Low (15-21% poverty): -0.5%;
Medium (21-29% poverty): -1.0%;
High (29-40% poverty): 0.9%;
Highest (40-100% poverty): 4.7%.
Source: GAO Analysis.
The more substantial effect of replacing the state per-pupil
expenditure factor, however, would be to reduce the variation in
funding among districts with higher percentages of poor children (see
figure 7). With the educational cost factor, the variation in funding
among districts with higher percentages of poor children would be
reduced from 19 percent to 13 percent, a reduction of 30 percent. In
contrast, the variation in funding among districts with low percentages
of poor children would be largely unaffected. However, if the current
hold-harmless rules were also replaced with the authorizing statutes
rules, very substantial reductions in funding disparities would result
among all school districts. Funding variations would be cut by more
than half between the highest and lowest poverty districts.
Figure 7: Comparison of the Variation in Funding Per Child Across
School Districts Under Formula Options That Replace State Per-Pupil
Spending With a Cost of Education Factor (Fiscal Year 2001):
[Refer to PDF for image]
This figure is a multiple line graph. The vertical axis of the graph
represents percent coefficient of variation. The horizontal axis of the
graph represents children grouped by percentage of poor children in
their school districts, from lowest to highest. The following funding
factors are depicted:
2001 Formula allocation;
State cost factor;
District cost factor;
District cost factor/authorizing hold-harmless.
Source: GAO Analysis.
[End of figure]
Raising the Poverty Threshold for Eligibility to Qualify for Basic
Grants Would Potentially Affect Large Numbers of Districts With Low
Percentages of Poor Children:
Title I grants have sometimes been criticized because the poverty
threshold for basic grant eligibility is so low and that nearly all
districts can participate in the program.[Footnote 43] It is often
noted that by funding nearly all districts, less funding is available
for high-poverty districts. One policy option is to raise the basic
grant eligibility threshold, making fewer districts eligible. With
fewer districts eligible, the remaining districts would receive more
funds per poor child, if total funding were to remain constant. Table 8
shows how increasing the current 2 percent poverty threshold to poverty
thresholds of 5 and 10 percent, respectively, would have this effect.
For example, a 10 percent threshold would result in 26 percent of all
districts, which contain 7.7 percent of all formula children, becoming
ineligible. This would allow funding per child in the remaining
districts to increase by 8.3 percent or $57. The effects of these
thresholds are shown on a state-by-state basis in table 9.
Table 8: Number of Eligible School Districts, Children, and Funding Per
Child Under Alternative Eligibility Thresholds:
Alternative Basic-Grant Eligibility Threshold:
Number of ineligible school districts (below eligibility threshold):
Current basic grant 2% eligibility threshold: 168;
5% Eligibility threshold: 1,148;
10% Eligibility threshold: 3,527.
Percentage of all school districts:
Current basic grant 2% eligibility threshold: 1.3%;
5% Eligibility threshold: 8.6%;
10% Eligibility threshold: 26.3%.
Number of children in ineligible districts (district doesn‘t meet
eligibility threshold):
Current basic grant 2% eligibility threshold: 7,141;
5% Eligibility threshold: 130,144;
10% Eligibility threshold: 779,684.
Percentage of all formula children:
Current basic grant 2% eligibility threshold: 0.07%;
5% Eligibility threshold: 1.3%;
10% Eligibility threshold: 7.7%.
Eligible district‘s average school year 2001 basic allotment per
eligible formula child:
Current basic grant 2% eligibility threshold: $684;
5% Eligibility threshold: $693;
10% Eligibility threshold: $741.
Percentage increase in funding to remaining eligible districts resulting
from increase in eligibility threshold:
Current basic grant 2% eligibility threshold: NA;
5% Eligibility threshold: 1.3%;
10% Eligibility threshold: 8.3%.
Note: Numbers and percentages exclude districts that would be
ineligible because they have fewer than 10 formula children.
Source: GAO Analysis.
[End of table]
Table 9: Number of Ineligible Districts, Poor Children, and Title I
Funding They Would Receive Under Alternative Eligibility Thresholds:
State: Alabama;
5% Eligibility threshold: Number of districts made ineligible: 6;
5% Eligibility threshold: Children in ineligible districts: 490;
5% Eligibility threshold: Total FY 2001 basic grant dollars reallocated
from ineligible districts: $368,973
10% Eligibility threshold: Number of districts made ineligible: 8;
10% Eligibility threshold: Children in ineligible districts: 4,458
10% Eligibility threshold: Total FY 2001 basic grant dollars
reallocated from ineligible districts: $3,729,223.
State: Alaska;
5% Eligibility threshold: Number of districts made ineligible: 0;
5% Eligibility threshold: Children in ineligible districts: 0;
5% Eligibility threshold: Total FY 2001 basic grant dollars reallocated
from ineligible districts: 0;
10% Eligibility threshold: Number of districts made ineligible: 7;
10% Eligibility threshold: Children in ineligible districts: 940;
10% Eligibility threshold: Total FY 2001 basic grant dollars
reallocated from ineligible districts: $776,674.
State: Arizona;
5% Eligibility threshold: Number of districts made ineligible: 7;
5% Eligibility threshold: Children in ineligible districts: 443;
5% Eligibility threshold: Total FY 2001 basic grant dollars reallocated
from ineligible districts: $324,165;
10% Eligibility threshold: Number of districts made ineligible: 20;
10% Eligibility threshold: Children in ineligible districts: 14,348;
10% Eligibility threshold: Total FY 2001 basic grant dollars
reallocated from ineligible districts: $7,851,414.
State: Arkansas;
5% Eligibility threshold: Number of districts made ineligible: 0;
5% Eligibility threshold: Children in ineligible districts: 0;
5% Eligibility threshold: Total FY 2001 basic grant dollars reallocated
from ineligible districts: 0;
10% Eligibility threshold: Number of districts made ineligible: 5;
10% Eligibility threshold: Children in ineligible districts: 984;
10% Eligibility threshold: Total FY 2001 basic grant dollars
reallocated from ineligible districts: $675,864.
State: California;
5% Eligibility threshold: Number of districts made ineligible: 46;
5% Eligibility threshold: Children in ineligible districts: 6,687
5% Eligibility threshold: Total FY 2001 basic grant dollars reallocated
from ineligible districts: $4,000,328
10% Eligibility threshold: Number of districts made ineligible: 166;
10% Eligibility threshold: Children in ineligible districts: 55,800
10% Eligibility threshold: Total FY 2001 basic grant dollars
reallocated from ineligible districts: $34,926,296.
State: Colorado;
5% Eligibility threshold: Number of districts made ineligible: 5;
5% Eligibility threshold: Children in ineligible districts: 1,610;
5% Eligibility threshold: Total FY 2001 basic grant dollars reallocated
from ineligible districts: $967,747;
10% Eligibility threshold: Number of districts made ineligible: 33;
10% Eligibility threshold: Children in ineligible districts: 23,044;
10% Eligibility threshold: Total FY 2001 basic grant dollars
reallocated from ineligible districts: $13,893,702.
State: Connecticut;
5% Eligibility threshold: Number of districts made ineligible: 59;
5% Eligibility threshold: Children in ineligible districts: 4,871;
5% Eligibility threshold: Total FY 2001 basic grant dollars reallocated
from ineligible districts: $3,924,895;
10% Eligibility threshold: Number of districts made ineligible: 116;
10% Eligibility threshold: Children in ineligible districts: 16,412;
10% Eligibility threshold: Total FY 2001 basic grant dollars
reallocated from ineligible districts: $13,273,760.
State: Delaware;
5% Eligibility threshold: Number of districts made ineligible: 0;
5% Eligibility threshold: Children in ineligible districts: 0;
5% Eligibility threshold: Total FY 2001 basic grant dollars reallocated
from ineligible districts: 0;
10% Eligibility threshold: Number of districts made ineligible: 1;
10% Eligibility threshold: Children in ineligible districts: 224;
10% Eligibility threshold: Total FY 2001 basic grant dollars
reallocated from ineligible districts: $203,485.
State: District of Columbia;
5% Eligibility threshold: Number of districts made ineligible: 0;
5% Eligibility threshold: Children in ineligible districts: 0;
5% Eligibility threshold: Total FY 2001 basic grant dollars reallocated
from ineligible districts: 0;
10% Eligibility threshold: Number of districts made ineligible: 0;
10% Eligibility threshold: Children in ineligible districts: 0;
10% Eligibility threshold: Total FY 2001 basic grant dollars
reallocated from ineligible districts: 0.
State: Florida;
5% Eligibility threshold: Number of districts made ineligible: 0;
5% Eligibility threshold: Children in ineligible districts: 0;
5% Eligibility threshold: Total FY 2001 basic grant dollars reallocated
from ineligible districts: 0;
10% Eligibility threshold: Number of districts made ineligible: 0;
10% Eligibility threshold: Children in ineligible districts: 0;
10% Eligibility threshold: Total FY 2001 basic grant dollars
reallocated from ineligible districts: 0.
State: Georgia;
5% Eligibility threshold: Number of districts made ineligible: 1;
5% Eligibility threshold: Children in ineligible districts: 23;
5% Eligibility threshold: Total FY 2001 basic grant dollars reallocated
from ineligible districts: $14,542;
10% Eligibility threshold: Number of districts made ineligible: 6;
10% Eligibility threshold: Children in ineligible districts: 20,004;
10% Eligibility threshold: Total FY 2001 basic grant dollars
reallocated from ineligible districts: $12,648,100.
State: Hawaii;
5% Eligibility threshold: Number of districts made ineligible: 0;
5% Eligibility threshold: Children in ineligible districts: 0;
5% Eligibility threshold: Total FY 2001 basic grant dollars reallocated
from ineligible districts: 0;
10% Eligibility threshold: Number of districts made ineligible: 0;
10% Eligibility threshold: Children in ineligible districts: 0;
10% Eligibility threshold: Total FY 2001 basic grant dollars
reallocated from ineligible districts: 0.
State: Idaho;
5% Eligibility threshold: Number of districts made ineligible: 2;
5% Eligibility threshold: Children in ineligible districts: 64;
5% Eligibility threshold: Total FY 2001 basic grant dollars reallocated
from ineligible districts: $57,553;
10% Eligibility threshold: Number of districts made ineligible: 10;
10% Eligibility threshold: Children in ineligible districts: 2,300;
10% Eligibility threshold: Total FY 2001 basic grant dollars
reallocated from ineligible districts: $1,494,645.
State: Illinois;
5% Eligibility threshold: Number of districts made ineligible: 171;
5% Eligibility threshold: Children in ineligible districts: 12,908;
5% Eligibility threshold: Total FY 2001 basic grant dollars reallocated
from ineligible districts: $9,831,050;
10% Eligibility threshold: Number of districts made ineligible: 386;
10% Eligibility threshold: Children in ineligible districts: 44,267;
10% Eligibility threshold: Total FY 2001 basic grant dollars
reallocated from ineligible districts: $33,665,002.
State: Indiana;
5% Eligibility threshold: Number of districts made ineligible: 28;
5% Eligibility threshold: Children in ineligible districts: 3,260;
5% Eligibility threshold: Total FY 2001 basic grant dollars reallocated
from ineligible districts: $2,400,094;
10% Eligibility threshold: Number of districts made ineligible: 128;
10% Eligibility threshold: Children in ineligible districts: 25,197;
10% Eligibility threshold: Total FY 2001 basic grant dollars
reallocated from ineligible districts: $17,963,907.
State: Iowa;
5% Eligibility threshold: Number of districts made ineligible: 20;
5% Eligibility threshold: Children in ineligible districts: 1,148;
5% Eligibility threshold: Total FY 2001 basic grant dollars reallocated
from ineligible districts: $1,020,095;
10% Eligibility threshold: Number of districts made ineligible: 128;
10% Eligibility threshold: Children in ineligible districts: 10,395;
10% Eligibility threshold: Total FY 2001 basic grant dollars
reallocated from ineligible districts: $8,267,730.
State: Kansas;
5% Eligibility threshold: Number of districts made ineligible: 9;
5% Eligibility threshold: Children in ineligible districts: 760;
5% Eligibility threshold: Total FY 2001 basic grant dollars reallocated
from ineligible districts: $552,810;
10% Eligibility threshold: Number of districts made ineligible: 63;
10% Eligibility threshold: Children in ineligible districts: 9,411;
10% Eligibility threshold: Total FY 2001 basic grant dollars
reallocated from ineligible districts: $6,437,589.
State: Kentucky;
5% Eligibility threshold: Number of districts made ineligible: 2;
5% Eligibility threshold: Children in ineligible districts: 285;
5% Eligibility threshold: Total FY 2001 basic grant dollars reallocated
from ineligible districts: $174,466;
10% Eligibility threshold: Number of districts made ineligible: 8;
10% Eligibility threshold: Children in ineligible districts: 3,431;
10% Eligibility threshold: Total FY 2001 basic grant dollars
reallocated from ineligible districts: $2,145,994.
State: Louisiana;
5% Eligibility threshold: Number of districts made ineligible: 0;
5% Eligibility threshold: Children in ineligible districts: 0;
5% Eligibility threshold: Total FY 2001 basic grant dollars reallocated
from ineligible districts: 0;
10% Eligibility threshold: Number of districts made ineligible: 0;
10% Eligibility threshold: Children in ineligible districts: 0;
10% Eligibility threshold: Total FY 2001 basic grant dollars
reallocated from ineligible districts: 0.
State: Maine;
5% Eligibility threshold: Number of districts made ineligible: 12;
5% Eligibility threshold: Children in ineligible districts: 467;
5% Eligibility threshold: Total FY 2001 basic grant dollars reallocated
from ineligible districts: $620,171;
10% Eligibility threshold: Number of districts made ineligible: 51;
10% Eligibility threshold: Children in ineligible districts: 3,643;
10% Eligibility threshold: Total FY 2001 basic grant dollars
reallocated from ineligible districts: $3,936,535.
State: Maryland;
5% Eligibility threshold: Number of districts made ineligible: 0;
5% Eligibility threshold: Children in ineligible districts: 0;
5% Eligibility threshold: Total FY 2001 basic grant dollars reallocated
from ineligible districts: 0;
10% Eligibility threshold: Number of districts made ineligible: 7;
10% Eligibility threshold: Children in ineligible districts: 33,679;
10% Eligibility threshold: Total FY 2001 basic grant dollars
reallocated from ineligible districts: $25,483,146.
State: Massachusetts;
5% Eligibility threshold: Number of districts made ineligible: 77;
5% Eligibility threshold: Children in ineligible districts: 6,068
5% Eligibility threshold: Total FY 2001 basic grant dollars reallocated
from ineligible districts: $5,385,737;
10% Eligibility threshold: Number of districts made ineligible: 177;
10% Eligibility threshold: Children in ineligible districts: 24,133;
10% Eligibility threshold: Total FY 2001 basic grant dollars
reallocated from ineligible districts: $20,302,292.
State: Michigan;
5% Eligibility threshold: Number of districts made ineligible: 52;
5% Eligibility threshold: Children in ineligible districts: 10,299;
5% Eligibility threshold: Total FY 2001 basic grant dollars reallocated
from ineligible districts: $9,577,340;
10% Eligibility threshold: Number of districts made ineligible: 161;
10% Eligibility threshold: Children in ineligible districts: 40,335;
10% Eligibility threshold: Total FY 2001 basic grant dollars
reallocated from ineligible districts: $36,122,572.
State: Minnesota;
5% Eligibility threshold: Number of districts made ineligible: 20;
5% Eligibility threshold: Children in ineligible districts: 6,257;
5% Eligibility threshold: Total FY 2001 basic grant dollars reallocated
from ineligible districts: $4,299,630;
10% Eligibility threshold: Number of districts made ineligible: 103;
10% Eligibility threshold: Children in ineligible districts: 31,867;
10% Eligibility threshold: Total FY 2001 basic grant dollars
reallocated from ineligible districts: $22,062,822.
State: Mississippi;
5% Eligibility threshold: Number of districts made ineligible: 0;
5% Eligibility threshold: Children in ineligible districts: 0;
5% Eligibility threshold: Total FY 2001 basic grant dollars reallocated
from ineligible districts: 0;
10% Eligibility threshold: Number of districts made ineligible: 0;
10% Eligibility threshold: Children in ineligible districts: 0;
10% Eligibility threshold: Total FY 2001 basic grant dollars
reallocated from ineligible districts: 0.
State: Missouri;
5% Eligibility threshold: Number of districts made ineligible: 16;
5% Eligibility threshold: Children in ineligible districts: 4,840;
5% Eligibility threshold: Total FY 2001 basic grant dollars reallocated
from ineligible districts: $3,295,938;
10% Eligibility threshold: Number of districts made ineligible: 75;
10% Eligibility threshold: Children in ineligible districts: 20,267;
10% Eligibility threshold: Total FY 2001 basic grant dollars
reallocated from ineligible districts: $14,583,945.
State: Montana;
5% Eligibility threshold: Number of districts made ineligible: 1;
5% Eligibility threshold: Children in ineligible districts: 23;
5% Eligibility threshold: Total FY 2001 basic grant dollars reallocated
from ineligible districts: $14,289;
10% Eligibility threshold: Number of districts made ineligible: 29;
10% Eligibility threshold: Children in ineligible districts: 661;
10% Eligibility threshold: Total FY 2001 basic grant dollars
reallocated from ineligible districts: $522,560.
State: Nebraska;
5% Eligibility threshold: Number of districts made ineligible: 14;
5% Eligibility threshold: Children in ineligible districts: 1,884;
5% Eligibility threshold: Total FY 2001 basic grant dollars reallocated
from ineligible districts: $1,397,013;
10% Eligibility threshold: Number of districts made ineligible: 100;
10% Eligibility threshold: Children in ineligible districts: 6,788;
10% Eligibility threshold: Total FY 2001 basic grant dollars
reallocated from ineligible districts: $5,642,142.
State: Nevada;
5% Eligibility threshold: Number of districts made ineligible: 0;
5% Eligibility threshold: Children in ineligible districts: 0;
5% Eligibility threshold: Total FY 2001 basic grant dollars reallocated
from ineligible districts: 0;
10% Eligibility threshold: Number of districts made ineligible: 2;
10% Eligibility threshold: Children in ineligible districts: 1,074;
10% Eligibility threshold: Total FY 2001 basic grant dollars
reallocated from ineligible districts: $608,365.
State: New Hampshire;
5% Eligibility threshold: Number of districts made ineligible: 27;
5% Eligibility threshold: Children in ineligible districts: 1,618;
5% Eligibility threshold: Total FY 2001 basic grant dollars reallocated
from ineligible districts: $1,459,650;
10% Eligibility threshold: Number of districts made ineligible: 84;
10% Eligibility threshold: Children in ineligible districts: 8,265;
10% Eligibility threshold: Total FY 2001 basic grant dollars
reallocated from ineligible districts: $7,315,072.
State: New Jersey;
5% Eligibility threshold: Number of districts made ineligible: 169;
5% Eligibility threshold: Children in ineligible districts: 12,890;
5% Eligibility threshold: Total FY 2001 basic grant dollars reallocated
from ineligible districts: $11,265,346;
10% Eligibility threshold: Number of districts made ineligible: 346;
10% Eligibility threshold: Children in ineligible districts: 41,109;
10% Eligibility threshold: Total FY 2001 basic grant dollars
reallocated from ineligible districts: $35,640,073.
State: New Mexico;
5% Eligibility threshold: Number of districts made ineligible: 2;
5% Eligibility threshold: Children in ineligible districts: 494;
5% Eligibility threshold: Total FY 2001 basic grant dollars reallocated
from ineligible districts: $316,533;
10% Eligibility threshold: Number of districts made ineligible: 3;
10% Eligibility threshold: Children in ineligible districts: 541;
10% Eligibility threshold: Total FY 2001 basic grant dollars
reallocated from ineligible districts: $341,780.
State: New York;
5% Eligibility threshold: Number of districts made ineligible: 77;
5% Eligibility threshold: Children in ineligible districts: 9,068;
5% Eligibility threshold: Total FY 2001 basic grant dollars reallocated
from ineligible districts: $7,796,900;
10% Eligibility threshold: Number of districts made ineligible: 223;
10% Eligibility threshold: Children in ineligible districts: 48,460;
10% Eligibility threshold: Total FY 2001 basic grant dollars
reallocated from ineligible districts: $39,926,375.
State: North Carolina;
5% Eligibility threshold: Number of districts made ineligible: 0;
5% Eligibility threshold: Children in ineligible districts: 0;
5% Eligibility threshold: Total FY 2001 basic grant dollars reallocated
from ineligible districts: 0;
10% Eligibility threshold: Number of districts made ineligible: 1;
10% Eligibility threshold: Children in ineligible districts: 1,788;
10% Eligibility threshold: Total FY 2001 basic grant dollars
reallocated from ineligible districts: $1,047,215.
State: North Dakota;
5% Eligibility threshold: Number of districts made ineligible: 2;
5% Eligibility threshold: Children in ineligible districts: 17;
5% Eligibility threshold: Total FY 2001 basic grant dollars reallocated
from ineligible districts: $14,578;
10% Eligibility threshold: Number of districts made ineligible: 21;
10% Eligibility threshold: Children in ineligible districts: 1,099;
10% Eligibility threshold: Total FY 2001 basic grant dollars
reallocated from ineligible districts: $1,018,412.
State: Ohio;
5% Eligibility threshold: Number of districts made ineligible: 107;
5% Eligibility threshold: Children in ineligible districts: 12,624;
5% Eligibility threshold: Total FY 2001 basic grant dollars reallocated
from ineligible districts: $10,803,019;
10% Eligibility threshold: Number of districts made ineligible: 294;
10% Eligibility threshold: Children in ineligible districts: 49,332;
10% Eligibility threshold: Total FY 2001 basic grant dollars
reallocated from ineligible districts: $40,399,218.
State: Oklahoma;
5% Eligibility threshold: Number of districts made ineligible: 5;
5% Eligibility threshold: Children in ineligible districts: 366;
5% Eligibility threshold: Total FY 2001 basic grant dollars reallocated
from ineligible districts: $295,932;
10% Eligibility threshold: Number of districts made ineligible: 39;
10% Eligibility threshold: Children in ineligible districts: 6,841;
10% Eligibility threshold: Total FY 2001 basic grant dollars
reallocated from ineligible districts: $4,554,951.
State: Oregon;
5% Eligibility threshold: Number of districts made ineligible: 4;
5% Eligibility threshold: Children in ineligible districts: 580;
5% Eligibility threshold: Total FY 2001 basic grant dollars reallocated
from ineligible districts: $449,338;
10% Eligibility threshold: Number of districts made ineligible: 26;
10% Eligibility threshold: Children in ineligible districts: 10,429;
10% Eligibility threshold: Total FY 2001 basic grant dollars
reallocated from ineligible districts: $7,873,530.
State: Pennsylvania;
5% Eligibility threshold: Number of districts made ineligible: 61;
5% Eligibility threshold: Children in ineligible districts: 9,522
5% Eligibility threshold: Total FY 2001 basic grant dollars reallocated
from ineligible districts: $7,774,477;
10% Eligibility threshold: Number of districts made ineligible: 176;
10% Eligibility threshold: Children in ineligible districts: 46,438;
10% Eligibility threshold: Total FY 2001 basic grant dollars
reallocated from ineligible districts: $37,347,170.
State: Puerto Rico;
5% Eligibility threshold: Number of districts made ineligible: 0;
5% Eligibility threshold: Children in ineligible districts: 0;
5% Eligibility threshold: Total FY 2001 basic grant dollars reallocated
from ineligible districts: 0;
10% Eligibility threshold: Number of districts made ineligible: 0;
10% Eligibility threshold: Children in ineligible districts: 0;
10% Eligibility threshold: Total FY 2001 basic grant dollars
reallocated from ineligible districts: 0.
State: Rhode Island;
5% Eligibility threshold: Number of districts made ineligible: 6;
5% Eligibility threshold: Children in ineligible districts: 582;
5% Eligibility threshold: Total FY 2001 basic grant dollars reallocated
from ineligible districts: $468,957;
10% Eligibility threshold: Number of districts made ineligible: 23;
10% Eligibility threshold: Children in ineligible districts: 6,187;
10% Eligibility threshold: Total FY 2001 basic grant dollars
reallocated from ineligible districts: $4,985,285.
State: South Carolina;
5% Eligibility threshold: Number of districts made ineligible: 0;
5% Eligibility threshold: Children in ineligible districts: 0;;
5% Eligibility threshold: Total FY 2001 basic grant dollars reallocated
from ineligible districts: 0;
10% Eligibility threshold: Number of districts made ineligible: 3;
10% Eligibility threshold: Children in ineligible districts: 1,380;
10% Eligibility threshold: Total FY 2001 basic grant dollars
reallocated from ineligible districts: $776,247.
State: South Dakota;
5% Eligibility threshold: Number of districts made ineligible: 3;
5% Eligibility threshold: Children in ineligible districts: 111;
5% Eligibility threshold: Total FY 2001 basic grant dollars reallocated
from ineligible districts: $100,455;
10% Eligibility threshold: Number of districts made ineligible: 20;
10% Eligibility threshold: Children in ineligible districts: 926;
10% Eligibility threshold: Total FY 2001 basic grant dollars
reallocated from ineligible districts: $775,148.
State: Tennessee;
5% Eligibility threshold: Number of districts made ineligible: 2;
5% Eligibility threshold: Children in ineligible districts: 1,023;
5% Eligibility threshold: Total FY 2001 basic grant dollars reallocated
from ineligible districts: $644,205;
10% Eligibility threshold: Number of districts made ineligible: 7;
10% Eligibility threshold: Children in ineligible districts: 6,622;
10% Eligibility threshold: Total FY 2001 basic grant dollars
reallocated from ineligible districts: $4,713,538.
State: Texas;
5% Eligibility threshold: Number of districts made ineligible: 31;
5% Eligibility threshold: Children in ineligible districts: 11,355;
5% Eligibility threshold: Total FY 2001 basic grant dollars reallocated
from ineligible districts: $7,457,363;
10% Eligibility threshold: Number of districts made ineligible: 110;
10% Eligibility threshold: Children in ineligible districts: 51,933;
10% Eligibility threshold: Total FY 2001 basic grant dollars
reallocated from ineligible districts: $32,388,180.
State: Utah;
5% Eligibility threshold: Number of districts made ineligible: 1;
5% Eligibility threshold: Children in ineligible districts: 111;
5% Eligibility threshold: Total FY 2001 basic grant dollars reallocated
from ineligible districts: $67,570;
10% Eligibility threshold: Number of districts made ineligible: 10;
10% Eligibility threshold: Children in ineligible districts: 17,050;
10% Eligibility threshold: Total FY 2001 basic grant dollars
reallocated from ineligible districts: $9,601,315.
State: Vermont;
5% Eligibility threshold: Number of districts made ineligible: 20;
5% Eligibility threshold: Children in ineligible districts: 701;
5% Eligibility threshold: Total FY 2001 basic grant dollars reallocated
from ineligible districts: $886,384;
10% Eligibility threshold: Number of districts made ineligible: 72;
10% Eligibility threshold: Children in ineligible districts:
10% Eligibility threshold: Total FY 2001 basic grant dollars
reallocated from ineligible districts: $3,597,152.
State: Virginia;
5% Eligibility threshold: Number of districts made ineligible: 0;
5% Eligibility threshold: Children in ineligible districts: 0;
5% Eligibility threshold: Total FY 2001 basic grant dollars reallocated
from ineligible districts: 0;
10% Eligibility threshold: Number of districts made ineligible: 17;
10% Eligibility threshold: Children in ineligible districts: 29,989;
10% Eligibility threshold: Total FY 2001 basic grant dollars
reallocated from ineligible districts: $17,618,948.
State: Washington;
5% Eligibility threshold: Number of districts made ineligible: 8;
5% Eligibility threshold: Children in ineligible districts: 1,641;
5% Eligibility threshold: Total FY 2001 basic grant dollars reallocated
from ineligible districts: $1,052,712;
10% Eligibility threshold: Number of districts made ineligible: 52;
10% Eligibility threshold: Children in ineligible districts: 26,901;
10% Eligibility threshold: Total FY 2001 basic grant dollars
reallocated from ineligible districts: $16,951,548.
State: West Virginia;
5% Eligibility threshold: Number of districts made ineligible: 0;
5% Eligibility threshold: Children in ineligible districts: 0;
5% Eligibility threshold: Total FY 2001 basic grant dollars reallocated
from ineligible districts: 0;
10% Eligibility threshold: Number of districts made ineligible: 0;
10% Eligibility threshold: Children in ineligible districts: 0;
10% Eligibility threshold: Total FY 2001 basic grant dollars
reallocated from ineligible districts: 0.
State: Wisconsin;
5% Eligibility threshold: Number of districts made ineligible: 74;
5% Eligibility threshold: Children in ineligible districts: 5,018;
5% Eligibility threshold: Total FY 2001 basic grant dollars reallocated
from ineligible districts: $4,224,246;
10% Eligibility threshold: Number of districts made ineligible: 202;
10% Eligibility threshold: Children in ineligible districts: 26,036;
10% Eligibility threshold: Total FY 2001 basic grant dollars
reallocated from ineligible districts: $21,483,181.
State: Wyoming;
5% Eligibility threshold: Number of districts made ineligible: 1;
5% Eligibility threshold: Children in ineligible districts: 36;
5% Eligibility threshold: Total FY 2001 basic grant dollars reallocated
from ineligible districts: $111,155;
10% Eligibility threshold: Number of districts made ineligible: 8;
10% Eligibility threshold: Children in ineligible districts: 1,921;
10% Eligibility threshold: Total FY 2001 basic grant dollars
reallocated from ineligible districts: $2,221,161.
Total:
5% Eligibility threshold: Number of districts made ineligible: 1,148;
5% Eligibility threshold: Children in ineligible districts: 130,144;
5% Eligibility threshold: Total FY 2001 basic grant dollars reallocated
from ineligible districts: $103,415,654;
10% Eligibility threshold: Number of districts made ineligible: 3,527;
10% Eligibility threshold: Children in ineligible districts: 779,684;
10% Eligibility threshold: Total FY 2001 basic grant dollars
reallocated from ineligible districts: $577,793,262.
Source: GAO Analysis.
Most States Alter Formula-Calculated Amounts When Allocating Funds to
Their School Districts:
Changes to the Title I allocation formulas will change the amount of
funds states receive and also would be expected to result in changes in
the amounts districts receive; however, there are limits on how
precisely changes in the formula can be expected to affect school
districts because states alter the formula-calculated amounts. In the
aggregate, relatively few poor children and Title I funds were
associated with districts whose allocations differed widely from their
formula-calculated amounts in the 1999-2000 school year. As a result,
state adjustments did not appear to alter the overall extent to which
available funding was allocated on the basis of the number of poor
children. However, for some individual states and school districts,
state adjustments were substantial.
When allocating the funds they receive from the federal government,
states adjust for changes in school district boundaries and the
creation of charter schools. In our work, we found that among the
school districts operating in the 1999-2000 school year, there were
more than 900 school districts, containing about 126,000 children
eligible for free or reduced-price lunch and receiving about $79
million in Title I funds, that were not included in Education‘s formula
calculations. In addition, states alter the formula-calculated amounts
to adjust for the poverty measure used for school districts in small
areas, as well as to fund statewide activities and program
administration. States are allowed to withhold up to 1.5 percent of
their Title I funds for statewide activities and program
administration, so this much variation from the formula-calculated
allocations is expected.
Considering only the districts that were included in Education‘s
calculations, we found that during the 1999-2000 school year 49 percent
of the districts received total Title I grants that differed by more
than 1.5 percent from the formula-calculated allocation; 16 percent of
districts‘ allocations differed by more than 10 percent. Among the
districts included in Education‘s calculations, over half of the Title
I funds were allocated to districts whose allocation amounts differed
from their formula calculations by no more than 1.5 percent. These
districts also contained just over half of the poor children. Only
about 5 percent of the funds were allocated to districts whose actual
allocations differed from their formula calculations by more than 10
percent. These districts also contained about 5 percent of the poor
children. (See table 10.)
Table 10: Distribution of Districts, Poor Children, and Title I Dollars
by Extent of Difference Between District Allocations and Formula
Calculations:
Number of school districts:
Districts with allocations differing from formula calculation by no
more than 1.5%: 7,009;
Districts with allocations differing from formula calculation by
between 1.5% and 10%: 4,554;
Districts with allocations differing from formula calculation by more
than 10%: 2,206;
Total: 13,769.
Percentage of school districts:
Districts with allocations differing from formula calculation by no
more than 1.5%: 51%;
Districts with allocations differing from formula calculation by
between 1.5% and 10%: 33%;
Districts with allocations differing from formula calculation by more
than 10%: 16%;
Total: 100%.
Number of Census poor children:
Districts with allocations differing from formula calculation by no
more than 1.5%: 5,065,175;
Districts with allocations differing from formula calculation by
between 1.5% and 10%: 3,644,038;
Districts with allocations differing from formula calculation by more
than 10%: 505,162;
Total: 9,214,375.
Percentage of Census poor children:
Districts with allocations differing from formula calculation by no
more than 1.5%: 55%;
Districts with allocations differing from formula calculation by
between 1.5% and 10%: 40%;
Districts with allocations differing from formula calculation by more
than 10%: 5%;
Total: 100%.
Number of children eligible for free or reduced-price lunch:
Districts with allocations differing from formula calculation by no
more than 1.5%: 9,485,789;
Districts with allocations differing from formula calculation by
between 1.5% and 10%: 7,187,813;
Districts with allocations differing from formula calculation by more
than 10%: 910,791;
Total: 17,584,393.
Percentage of children eligible for free or reduced-price lunch:
Districts with allocations differing from formula calculation by no
more than 1.5%: 54%;
Districts with allocations differing from formula calculation by
between 1.5% and 10%: 41%;
Districts with allocations differing from formula calculation by more
than 10%: 5%;
Total: 100%.
Formula-calculated dollar amounts:
Districts with allocations differing from formula calculation by no
more than 1.5%: $4,150,777,359;
Districts with allocations differing from formula calculation by
between 1.5% and 10%: $2,702,779,708;
Districts with allocations differing from formula calculation by more
than 10%: $401,904,928;
Total: $7,255,461,995.
Percentage of formula-calculated dollars:
Districts with allocations differing from formula calculation by no
more than 1.5%: 57%;
Districts with allocations differing from formula calculation by
between 1.5% and 10%: 37%;
Districts with allocations differing from formula calculation by more
than 10%: 6%;
Total: 100%.
Actual allocation dollar amounts:
Districts with allocations differing from formula calculation by no
more than 1.5%: $4,129,794,331;
Districts with allocations differing from formula calculation by
between 1.5% and 10%: $2,630,272,381;
Districts with allocations differing from formula calculation by more
than 10%: $348,916,755;
Total: $7,108,983,467.
Percentage of actual allocations:
Districts with allocations differing from formula calculation by no
more than 1.5%: 58%;
Districts with allocations differing from formula calculation by
between 1.5% and 10%: 37%;
Districts with allocations differing from formula calculation by more
than 10%: 5%;
Total: 100%.
Source: GAO Analysis.
[End of table]
The variation between actual allocations and the formula calculations
is greater in some states than in others. There are some states, for
example, Georgia, Louisiana, and South Dakota, where actual allocations
to school districts are very close to the formula calculations. (See
table 11.)
Table 11: Percentage of Poor Children and Percentage of Dollars
Allocated to Districts Whose Allocations Differed From Formula
Calculations by More Than 1.5 Percent:
Percentage of districts with allocations differing from formula
calculations by more than 1.5 percent:
South Dakota: 6%;
Georgia: 18%;
Louisiana: 16%.
Percentage of Census poor children in districts with allocations
differing from formula calculations by more than 1.5 percent:
South Dakota: 6%;
Georgia: 29%;
Louisiana: 46%.
Percentage of Title I allocations received in districts with
allocations differing from formula calculations by more than 1.5
percent:
South Dakota: 6%;
Georgia: 28%;
Louisiana: 40%.
Source: GAO Analysis.
[End of table]
However, these states are the exception, as most states, including
Delaware, North Dakota, and Maine, had many districts receiving very
different allocations than the formula calculations. (See table 12.)
Table 12: Percentage of Poor Children and Percentage of Dollars
Allocated to Districts Whose Allocations Differed From Formula
Calculations by More Than 10 Percent:
Percentage of districts with allocations differing from formula
calculations by more than 10 percent:
North Dakota: 62%;
Delaware: 49%;
Maine: 40%.
Percentage of Census poor children in districts with allocations
differing from formula calculations by more than 10 percent:
North Dakota: 51%;
Delaware: 41%;
Maine: 31%.
Percentage of Title I allocations received in districts with
allocations differing from formula calculations by more than 10
percent:
North Dakota: 56%;
Delaware: 41%;
Maine: 29%.
Source: GAO Analysis.
[End of table]
However, states do not appear to alter the overall extent to which
available funding is allocated on the basis of the number of poor
children. Table 13 shows for each state the percentage of its districts
whose total Title I grants differed from their formula calculations by
less than 1.5 percent, between 1.5 and 10 percent, and by more than 10
percent.
Table 13: Differences Between Actual Allocations and Formula Calculated
Amounts, 1999-2000 School Year:
State: Alabama;
Percentage of districts with grants within 1.5% of formula
calculation[A]: 61.1;
Percentage of districts with grants between 1.5% and 10% of formula
calculation: 19.8;
Percentage of districts with grants more than 10% from formula
calculation: 19.1;
Total: 100%.
State: Alaska;
Percentage of districts with grants within 1.5% of formula
calculation[A]: 28.3;
Percentage of districts with grants between 1.5% and 10% of formula
calculation: 34.0;
Percentage of districts with grants more than 10% from formula
calculation: 37.7;
Total: 100%.
State: Arizona;
Percentage of districts with grants within 1.5% of formula
calculation[A]: 11.8;
Percentage of districts with grants between 1.5% and 10% of formula
calculation: 52.9;
Percentage of districts with grants more than 10% from formula
calculation: 35.3;
Total: 100%.
State: Arkansas;
Percentage of districts with grants within 1.5% of formula
calculation[A]: 68.4;
Percentage of districts with grants between 1.5% and 10% of formula
calculation: 31.6;
Percentage of districts with grants more than 10% from formula
calculation: 0.0;
Total: 100%.
State: California;
Percentage of districts with grants within 1.5% of formula
calculation[A]: 33.5;
Percentage of districts with grants between 1.5% and 10% of formula
calculation: 64.1;
Percentage of districts with grants more than 10% from formula
calculation: 2.4;
Total: 100%.
State: Colorado;
Percentage of districts with grants within 1.5% of formula
calculation[A]: 71.6;
Percentage of districts with grants between 1.5% and 10% of formula
calculation: 19.3;
Percentage of districts with grants more than 10% from formula
calculation: 9.1;
Total: 100%.
State: Connecticut;
Percentage of districts with grants within 1.5% of formula
calculation[A]: 41.6;
Percentage of districts with grants between 1.5% and 10% of formula
calculation: 27.7;
Percentage of districts with grants more than 10% from formula
calculation: 30.7;
Total: 100%.
State: Delaware;
Percentage of districts with grants within 1.5% of formula
calculation[A]: 6.3;
Percentage of districts with grants between 1.5% and 10% of formula
calculation: 31.3;
Percentage of districts with grants more than 10% from formula
calculation: 62.4;
Total: 100%.
State: Florida;
Percentage of districts with grants within 1.5% of formula
calculation[A]: 40.3;
Percentage of districts with grants between 1.5% and 10% of formula
calculation: 59.7;
Percentage of districts with grants more than 10% from formula
calculation: 0.0;
Total: 100%.
State: Georgia;
Percentage of districts with grants within 1.5% of formula
calculation[A]: 94.4;
Percentage of districts with grants between 1.5% and 10% of formula
calculation: 5.6;
Percentage of districts with grants more than 10% from formula
calculation: 0.0;
Total: 100%.
State: Idaho;
Percentage of districts with grants within 1.5% of formula
calculation[A]: 71.4;
Percentage of districts with grants between 1.5% and 10% of formula
calculation: 37.7;
Percentage of districts with grants more than 10% from formula
calculation: 0.9;
Total: 100%.
State: Illinois;
Percentage of districts with grants within 1.5% of formula
calculation[A]: 69.5;
Percentage of districts with grants between 1.5% and 10% of formula
calculation: 14.4;
Percentage of districts with grants more than 10% from formula
calculation: 16.1;
Total: 100%.
State: Indiana;
Percentage of districts with grants within 1.5% of formula
calculation[A]: 56.7;
Percentage of districts with grants between 1.5% and 10% of formula
calculation: 31.8;
Percentage of districts with grants more than 10% from formula
calculation: 11.5;
Total: 100%.
State: Iowa;
Percentage of districts with grants within 1.5% of formula
calculation[A]: 39.8;
Percentage of districts with grants between 1.5% and 10% of formula
calculation: 41.5;
Percentage of districts with grants more than 10% from formula
calculation: 18.7;
Total: 100%.
State: Kansas;
Percentage of districts with grants within 1.5% of formula
calculation[A]: 55.3;
Percentage of districts with grants between 1.5% and 10% of formula
calculation: 27.8;
Percentage of districts with grants more than 10% from formula
calculation: 16.9;
Total: 100%.
State: Kentucky;
Percentage of districts with grants within 1.5% of formula
calculation[A]: 0.6;
Percentage of districts with grants between 1.5% and 10% of formula
calculation: 94.9;
Percentage of districts with grants more than 10% from formula
calculation: 4.5;
Total: 100%.
State: Louisiana;
Percentage of districts with grants within 1.5% of formula
calculation[A]: 81.8;
Percentage of districts with grants between 1.5% and 10% of formula
calculation: 13.6;
Percentage of districts with grants more than 10% from formula
calculation: 4.6;
Total: 100%.
State: Maine;
Percentage of districts with grants within 1.5% of formula
calculation[A]: 35.0;
Percentage of districts with grants between 1.5% and 10% of formula
calculation: 25.1;
Percentage of districts with grants more than 10% from formula
calculation: 39.9;
Total: 100%.
State: Maryland;
Percentage of districts with grants within 1.5% of formula
calculation[A]: 29.2;
Percentage of districts with grants between 1.5% and 10% of formula
calculation: 70.8;
Percentage of districts with grants more than 10% from formula
calculation: 0.0;
Total: 100%.
State: Massachusetts;
Percentage of districts with grants within 1.5% of formula
calculation[A]: 43.2;
Percentage of districts with grants between 1.5% and 10% of formula
calculation: 10.0;
Percentage of districts with grants more than 10% from formula
calculation: 46.8;
Total: 100%.
State: Michigan;
Percentage of districts with grants within 1.5% of formula
calculation[A]: 66.0;
Percentage of districts with grants between 1.5% and 10% of formula
calculation: 16.6;
Percentage of districts with grants more than 10% from formula
calculation: 17.4;
Total: 100%.
State: Minnesota;
Percentage of districts with grants within 1.5% of formula
calculation[A]: 71.2;
Percentage of districts with grants between 1.5% and 10% of formula
calculation: 20.2;
Percentage of districts with grants more than 10% from formula
calculation: 8.6;
Total: 100%.
State: Mississippi;
Percentage of districts with grants within 1.5% of formula
calculation[A]: 76.5;
Percentage of districts with grants between 1.5% and 10% of formula
calculation: 12.8;
Percentage of districts with grants more than 10% from formula
calculation: 10.7;
Total: 100%.
State: Missouri;
Percentage of districts with grants within 1.5% of formula
calculation[A]: 30.4;
Percentage of districts with grants between 1.5% and 10% of formula
calculation: 29.2;
Percentage of districts with grants more than 10% from formula
calculation: 40.4;
Total: 100%.
State: Montana;
Percentage of districts with grants within 1.5% of formula
calculation[A]: 70.8;
Percentage of districts with grants between 1.5% and 10% of formula
calculation: 18.3;
Percentage of districts with grants more than 10% from formula
calculation: 10.9;
Total: 100%.
State: Nebraska;
Percentage of districts with grants within 1.5% of formula
calculation[A]: 64.5;
Percentage of districts with grants between 1.5% and 10% of formula
calculation: 13.7;
Percentage of districts with grants more than 10% from formula
calculation: 21.8;
Total: 100%.
State: Nevada;
Percentage of districts with grants within 1.5% of formula
calculation[A]: 58.8;
Percentage of districts with grants between 1.5% and 10% of formula
calculation: 41.2;
Percentage of districts with grants more than 10% from formula
calculation: 0.0;
Total: 100%.
State: New Hampshire;
Percentage of districts with grants within 1.5% of formula
calculation[A]: 19.8;
Percentage of districts with grants between 1.5% and 10% of formula
calculation: 71.6;
Percentage of districts with grants more than 10% from formula
calculation: 8.6;
Total: 100%.
State: New Jersey;
Percentage of districts with grants within 1.5% of formula
calculation[A]: 31.0;
Percentage of districts with grants between 1.5% and 10% of formula
calculation: 22.6;
Percentage of districts with grants more than 10% from formula
calculation: 46.4;
Total: 100%.
State: New Mexico;
Percentage of districts with grants within 1.5% of formula
calculation[A]: 47.2;
Percentage of districts with grants between 1.5% and 10% of formula
calculation: 46.1;
Percentage of districts with grants more than 10% from formula
calculation: 6.7;
Total: 100%.
State: New York;
Percentage of districts with grants within 1.5% of formula
calculation[A]: 28.5;
Percentage of districts with grants between 1.5% and 10% of formula
calculation: 70.6;
Percentage of districts with grants more than 10% from formula
calculation: 0.9;
Total: 100%.
State: North Carolina;
Percentage of districts with grants within 1.5% of formula
calculation[A]: 43.6;
Percentage of districts with grants between 1.5% and 10% of formula
calculation: 54.7;
Percentage of districts with grants more than 10% from formula
calculation: 1.7;
Total: 100%.
State: North Dakota;
Percentage of districts with grants within 1.5% of formula
calculation[A]: 18.0;
Percentage of districts with grants between 1.5% and 10% of formula
calculation: 33.5;
Percentage of districts with grants more than 10% from formula
calculation: 48.5;
Total: 100%.
State: Ohio;
Percentage of districts with grants within 1.5% of formula
calculation[A]: 76.2;
Percentage of districts with grants between 1.5% and 10% of formula
calculation: 13.4;
Percentage of districts with grants more than 10% from formula
calculation: 10.4;
Total: 100%.
State: Oklahoma;
Percentage of districts with grants within 1.5% of formula
calculation[A]: 32.5;
Percentage of districts with grants between 1.5% and 10% of formula
calculation: 23.2;
Percentage of districts with grants more than 10% from formula
calculation: 44.3;
Total: 100%.
State: Oregon;
Percentage of districts with grants within 1.5% of formula
calculation[A]: 61.5;
Percentage of districts with grants between 1.5% and 10% of formula
calculation: 21.0;
Percentage of districts with grants more than 10% from formula
calculation: 17.5;
Total: 100%.
State: Pennsylvania;
Percentage of districts with grants within 1.5% of formula
calculation[A]: 74.3;
Percentage of districts with grants between 1.5% and 10% of formula
calculation: 12.3;
Percentage of districts with grants more than 10% from formula
calculation: 13.4;
Total: 100%.
State: Rhode Island;
Percentage of districts with grants within 1.5% of formula
calculation[A]: 36.1;
Percentage of districts with grants between 1.5% and 10% of formula
calculation: 16.7;
Percentage of districts with grants more than 10% from formula
calculation: 47.2;
Total: 100%.
State: South Carolina;
Percentage of districts with grants within 1.5% of formula
calculation[A]: 44.2;
Percentage of districts with grants between 1.5% and 10% of formula
calculation: 47.7;
Percentage of districts with grants more than 10% from formula
calculation: 8.1;
Total: 100%.
State: South Dakota;
Percentage of districts with grants within 1.5% of formula
calculation[A]: 84.3;
Percentage of districts with grants between 1.5% and 10% of formula
calculation: 8.7;
Percentage of districts with grants more than 10% from formula
calculation: 7.0;
Total: 100%.
State: Tennessee;
Percentage of districts with grants within 1.5% of formula
calculation[A]: 67.2;
Percentage of districts with grants between 1.5% and 10% of formula
calculation: 24.1;
Percentage of districts with grants more than 10% from formula
calculation: 8.7;
Total: 100%.
State: Texas;
Percentage of districts with grants within 1.5% of formula
calculation[A]: 56.0;
Percentage of districts with grants between 1.5% and 10% of formula
calculation: 43.2;
Percentage of districts with grants more than 10% from formula
calculation: 0.8;
Total: 100%.
State: Utah;
Percentage of districts with grants within 1.5% of formula
calculation[A]: 70.0;
Percentage of districts with grants between 1.5% and 10% of formula
calculation: 17.5;
Percentage of districts with grants more than 10% from formula
calculation: 12.5;
Total: 100%.
State: Virginia;
Percentage of districts with grants within 1.5% of formula
calculation[A]: 69.9;
Percentage of districts with grants between 1.5% and 10% of formula
calculation: 29.3;
Percentage of districts with grants more than 10% from formula
calculation: 0.8;
Total: 100%.
State: Washington;
Percentage of districts with grants within 1.5% of formula
calculation[A]: 66.9;
Percentage of districts with grants between 1.5% and 10% of formula
calculation: 20.6;
Percentage of districts with grants more than 10% from formula
calculation: 12.5;
Total: 100%.
State: West Virginia;
Percentage of districts with grants within 1.5% of formula
calculation[A]: 69.1;
Percentage of districts with grants between 1.5% and 10% of formula
calculation: 21.8;
Percentage of districts with grants more than 10% from formula
calculation: 9.1;
Total: 100%.
State: Wisconsin;
Percentage of districts with grants within 1.5% of formula
calculation[A]: 6.4;
Percentage of districts with grants between 1.5% and 10% of formula
calculation: 89.9;;
Percentage of districts with grants more than 10% from formula
calculation: 3.7;
Total: 100%.
State: Wyoming;
Percentage of districts with grants within 1.5% of formula
calculation[A]: 29.2;
Percentage of districts with grants between 1.5% and 10% of formula
calculation: 31.3;
Percentage of districts with grants more than 10% from formula
calculation: 39.5;
Total: 100%.
National:
Percentage of districts with grants within 1.5% of formula
calculation[A]: 50.9;
Percentage of districts with grants between 1.5% and 10% of formula
calculation: 33.1;
Percentage of districts with grants more than 10% from formula
calculation: 16.0;
Total: 100%.
Note: Hawaii and District of Columbia excluded, as they are single
districts. Vermont excluded as Supervisory Unions, not districts,
utilized for allocating funds.
[A] Includes those districts calculated by Education to receive $0.
Source: GAO Analysis.
[End of table]
Concluding Observations:
Although Title I funding generally reflects the distribution of poor
children, there are many instances of states, districts, and schools
with either similar numbers or similar percentages of poor children
receiving widely differing amounts of funding per poor child. These
differences result, in part, from formula provisions that attempt to
balance several, sometimes competing, goals. These goals include
allocating funds based on the distribution of poor children, ensuring
that states and districts are provided funding stability even in light
of declining numbers of poor children, and addressing differences
across school districts and states in the costs of providing
educational services. Choosing among the policy options discussed in
this report will entail, in part, weighing the goal of increased
targeting with other goals. Enacting any of the policy options” using
less restrictive hold-harmless provisions, funding targeted grants,
using an alternative cost factor, or raising the eligibility
threshold”would result in changes for many states and school districts
in terms of their formula calculations. In addition, under any of these
policy options, states and school districts would still have
flexibility in making allocation decisions”flexibility that allows
states and school districts to use these funds in a manner that they
believe best meets the needs of disadvantaged children.
Agency Comments:
In written comments on our draft report, the Department of Education
generally agreed with the findings presented in the report. Education
suggested that our report be updated to reflect the passage of the ’No
Child Left Behind Act of 2001“ and the fiscal 2002 appropriations act.
Appendix III describes the impact of this legislation on the aspects of
Title I discussed in the report. Education‘s written comments are
printed in appendix IV.
In written comments on our draft report, the U.S. Department of
Agriculture (USDA) said that the Food and Nutrition Service (FNS) has
become increasingly aware of the limitations of free and reduced-price
lunch data as a measure of low-income status, which could have
implications for the targeting of Title I funds. As described in the
report, we recognize that there are limitations of these data as a
measure of poverty. Despite these limitations, however, we chose to use
subsidized lunch data as one of our measures of poverty for several
reasons. We used these data as a poverty measure at the school level
because the Department of Education has found these data to be the best
available source of poverty data at the school level. We used these
data as a poverty measure at the school district level because
subsidized lunch data are available at the school, district, and state
levels, and thus provide a consistent measure across all three levels.
Also, subsidized lunch data are available for nearly all school
districts, including charter schools, whereas Census poverty estimates
are available only for the somewhat limited number of school districts
included in Education‘s database. While recognizing the limitations of
subsidized lunch data, we believe the use of it, along with Census
poverty estimates, strengthens our report findings. USDA‘s written
comments are printed in appendix V.
We are sending copies of this report to the Secretaries of Education
and Agriculture and interested congressional committees. We will also
make copies available to others upon request. If you have any questions
concerning this report, please contact me on (202) 512-7215. Other GAO
contacts and staff acknowledgments are listed in appendix VI.
Signed by:
Marnie S. Shaul:
Director, Education, Workforce, and Income Security Issues:
[End of section]
List of Congressional Addressees:
The Honorable Tom Harkin:
Chairman:
The Honorable Arlen Specter:
Ranking Minority Member:
Subcommittee on Labor, Health and Human Services, and Education:
Committee on Appropriations:
United States Senate:
The Honorable Ralph Regula:
Chairman:
The Honorable David Obey:
Ranking Minority Member:
Subcommittee on Labor, Health and Human Services, Education and Related
Agencies:
Committee on Appropriations:
House of Representatives:
The Honorable Edward M. Kennedy:
Chairman:
The Honorable Judd Gregg:
Ranking Minority Member:
Committee on Health, Education, Labor and Pensions:
United States Senate:
The Honorable John A. Boehner:
Chairman:
The Honorable George Miller:
Ranking Minority Member:
Committee on Education and the Workforce:
House of Representatives:
The Honorable Evan Bayh:
The Honorable John Breaux:
The Honorable Herb Kohl:
The Honorable Mary Landrieu:
The Honorable Joseph Lieberman:
The Honorable Blanche Lincoln:
United States Senate:
[End of section]
Appendix I: Objectives, Scope, and Methodology:
As mandated by the Congress (Public Law 106-554 Sec. 305), we designed
our study to provide information on (1) the extent to which Title I
funds are allocated to states, school districts and schools with the
greatest numbers and percentages of school-age children from low-income
families; (2) the extent to which allocations of such funds adjust to
shifts in numbers of children from low-income families; (3) the extent
to which the allocation of Title I funds encourages the targeting of
state funds to school-age children from low-income families; and (4)
what options might improve targeting of funds, especially to states and
school districts with higher numbers and percentages of poor children,
to more effectively serve those children. To determine the extent to
which Title I funds are targeted to poor children, we used two measures
of poverty and two types of allocation data. We used the Census
Bureau‘s updated decennial poverty data for one measure. Census poverty
data are used by the U.S. Department of Education to calculate Title I
formula allocation amounts. For the second measure of poverty, we used
eligibility for free or reduced-price lunches through the National
School Lunch Program, a federal food assistance program administered by
the U.S. Department of Agriculture for children from low-income
families. The subsidized lunch program provides the best source of data
on low-income students at the school-level, according to the Department
of Education, and these data are also available for the district and
state levels.
We determined how states actually allocated Title I funds to each of
their school districts by collecting 1999-2000 allocation information
directly from state Title I officials in every state and the District
of Columbia. In this report, we refer to these data as ’actual
allocations“ or simply ’allocations.“ We compared the actual
allocations with the amounts generated by the Title I formula
calculations for the 1999-2000 school year, which we obtained from the
Department of Education. In this report, we refer to these data as
’formula calculations.“ Formula calculations are the data typically
used in analyses of the Title I program. The formula calculations
accurately reflect the amount of funds allocated to each state, but
these data do not reflect changes that states subsequently make to the
formula-calculated amounts when allocating the funds to their school
districts. We also interviewed state Title I directors in each of the
50 states and the District of Columbia about their experiences and
perceptions of the Title I program. We examined school district
policies for allocating Title I funds to schools by surveying a
nationally representative, stratified sample of school districts. In
addition, we reviewed school-level allocation data from the few states
that were able to provide it.
We examined the responsiveness of state-level Title I allocations to
shifts in poverty by analyzing Census data and Title I allocation data
from the Department of Education for the period of 1980 to the present.
We analyzed the relevant statutory provisions and reviewed our previous
reports to identify incentives for states to target their own funds.
Finally, we determined the consequences of various policy options by
examining the Title I formulas and running simulations of Education‘s
formula calculation process for states and school districts for the
2001-02 school year. We conducted our work from December 2000 to
December 2001 in accordance with generally accepted government auditing
standards.
Federal Funding Formulas:
From the Title I statute, we obtained the formulas that Education is
required to use to calculate Title I grant amounts. We met with
Education officials to discuss their procedures for using the formulas
and data to calculate grant amounts. We used these procedures to
replicate Education‘s formula calculations for the 1999-2000 and 2000-
01 school years and as the basis for computer simulations of various
changes that could be made to the formulas.
Education‘s Title I Formula Calculations:
From the Department of Education, we obtained the grant amounts
calculated for school districts for the 1999-2000, 2000-01, and 2001-02
school years, which Education generated using the federal funding
formulas included in the Title I statute. The school districts for
which Education calculated grant amounts in the 1999-2000, 2000-01
school years were those known to Education in the 1995-96 school year.
The school districts for which Education calculated grant amounts in
the 2001-02 school year were those known to Education in the 1997-98
school year. At no time have the calculations included charter schools.
The data set from Education also included 1995 Census data on the
characteristics of these school districts, such as numbers of school-
age poor children, total numbers of school-age children, and total
resident populations, which Education used in calculating grant
amounts. The formula calculations were used to examine their
relationship to poverty and other characteristics of school districts
and to compare the formula calculations to the actual allocations that
school districts received.
Actual Allocations to School Districts:
We collected data from state Title I program directors on the dollar
amounts of Title I funds, if any, that they disbursed to each of their
school districts in the 1999-2000 school year. We collected allocation
data on basic and concentration grants to 14,682 school districts in
all 50 states and the District of Columbia, including data on charter
schools that are independent school districts, as they existed in the
1999-2000 school year. Where possible, we matched the school district
data provided by the states with the school district data provided by
Education. Where the lists of school districts differed, we called
state officials to verify the accuracy of their data. In most cases,
state officials clarified that districts had been created,
consolidated, eliminated, or had changed names since Education‘s data
were updated in 1995. For those school districts that were identified
both by state officials and Education, we compared the actual
allocations with Education‘s formula calculations and examined the
relationships between the actual allocations and Census poverty and
other school district characteristics. We also used the actual
allocation data to examine the relationship between the actual
allocations and poverty, as measured by eligibility for free or reduced-
price lunches.
School-Level Allocation Data:
From state Title I directors, we requested data on the dollar amount of
Title I funds that each of their states‘ schools received in the 1999-
2000 school year, if these data were available in an electronic format.
From state food services officials, we also requested for each school,
electronic data on enrollment and the number of students receiving free
or reduced-price lunches. Only three states (California, Georgia, and
Mississippi) could provide us with school-level allocations,
enrollment, and school lunch data in an electronic format for each of
their schools.
For each school in these three states, we matched the allocation data
to the enrollment and school lunch data and calculated both the
percentages of children eligible for free or reduced-price lunch and
the amount of funds received per poor child. Because we obtained data
on every school within these three states, there is no estimation or
sampling error associated with our results. However, our findings based
on these data are not generalizable beyond the state or school year for
which the data were collected.
Free and Reduced-Price Lunch Data:
To estimate the numbers and percentages of children in poverty in every
school district, we obtained data from state school food service
officials on both the numbers of children receiving free or reduced-
price lunches through the National School Lunch Program (NLSP) and the
total number of students enrolled in each school district in the 1999-
2000 school year. We also obtained these data at the school level,
where available. Children from families with incomes at or below 130
percent of the poverty level are eligible for free meals through NSLP;
those with incomes between 130 and 185 percent of the poverty level are
eligible for reduced-price meals.
We requested NSLP participation data for every school district in every
state, including charter schools that are independent school districts,
where available. These data were combined with school district-level
data on Title I allocations in order to calculate the amount of Title I
allocations per poor child received in each district.
We chose participation in the NSLP as a measure of school district
poverty because it is the measure used most commonly by school
districts to determine allocations to schools and is the best source of
poverty data that is available at the state, district, and school
levels. Because participation in the NSLP is voluntary, there is some
concern that participation rates may reflect, in part, the effort
schools make to encourage participation, and may not consistently
reflect actual program eligibility rates across schools and school
districts. There is also concern that high school students are less
likely to participate in the program than younger students due to the
associated stigma. Nonetheless, a National Research Council panel
concluded that NSLP participation is an indicator of low family income
and that the quality of NSLP data are neither appreciably better nor
worse than Census data for measuring poverty, especially for areas as
small as school districts.
Waivers of Title I Regulations:
To obtain information on the number and types of waivers granted to
districts under the Elementary and Secondary Education Act, we reviewed
Education‘s annual reports to the Congress for 1998-2001 and met with
program officials. To obtain information on the number and types of
waivers granted by ’Ed-Flex“ states under the 1994 and 1996 Ed-Flex
Demonstration Project and the Ed-Flex Partnership Act of 1999, we met
with program officials and reviewed states‘ Ed-Flex applications on
file with Education. We used this information to determine the most
common types of waivers that were granted overall.
Interviews With State Title I Directors:
To obtain information on both states‘ roles in the Title I allocation
process and the opinions of state Title I directors, we conducted
telephone interviews with the directors of the Title I program in every
state and the District of Columbia between December 2000 and May 2001,
using a semi-structured interview protocol. We asked the directors to
explain exactly how they generate dollar allocations to school
districts once they receive the information from the Department of
Education, including how they apportion funds to small size districts
and districts whose boundaries have changed, how charter schools are
handled in the allocation process, what data they use, and how recent
those data are. Finally, we asked whether their states had compensatory
education programs that target funding to high-poverty schools and
districts and, if so, how allocations for that program were related to
the allocation of Title I dollars.
Survey of School Districts:
We surveyed a stratified nationally representative sample of school
district administrators drawn from the approximately 13,000 school
districts nationwide for which Education had calculated an initial
Title I allocation amount for the 1999-2000 school year. In addition to
providing information on their school districts‘ schools and
communities, survey respondents provided information on how they
measure poverty in their schools, their priorities and rationales in
distributing funds, and their use of funds for district-level
activities.
The sample was stratified into four categories according to the number
of school-age children living in the school district boundaries, as
follows: 2-500 children; 501-2,500 children; 2501-50,000 children; over
50,000 children. A random sample was drawn from each of the first three
strata; all of the 96 school districts with greater than 50,000
children were included in the survey. Table 14 provides information on
the total numbers of students and districts, the number of districts
sampled, and the response rate for each of the strata. This sample
design allows us to generalize our results to all school districts of
similar sizes, including the very smallest school districts. The survey
was conducted between July and October 2001 and reflects school
district decisions in the 2000-01 school year.
Table 14: Number of Students, Districts, Districts Sampled, and
Response Rates by Survey Strata:
Strata (by number of students in district): 2-500 students:
Number of students nationwide (percentage of all students): 876,634
(0.2%);
Number of districts nationwide[A] (percentage of all districts): 3,385
(26%);
Number of districts sampled: 173;
Response rate (percentage): 92.
Strata (by number of students in district): 501-2,500 students:
Number of students nationwide (percentage of all students): 7,118,365
(15%);
Number of districts nationwide[A] (percentage of all districts): 5,660
(44%);
Number of districts sampled: 187;
Response rate (percentage): 94.
Strata (by number of students in district): 2,501-50,000 students:
Number of students nationwide (percentage of all students): 28,576,493
(61%);
Number of districts nationwide[A] (percentage of all districts): 3,741
(29%);
Number of districts sampled: 397;
Response rate (percentage): 91.
Strata (by number of students in district): More than 50,000 students:
Number of students nationwide (percentage of all students): 10,295,794
(22%);
Number of districts nationwide[A] (percentage of all districts): 96
(0.7%);
Number of districts sampled: 93;
Response rate (percentage): 89.
Total:
Number of students nationwide (percentage of all students): 46,867,286
(100%);
Number of districts nationwide[A] (percentage of all districts): 12,882
(100%);
Number of districts sampled: 850;
Response rate (percentage): 92.
Note: An estimated 20 percent of school districts consist of only one
school, so survey questions regarding how funds were distributed among
schools were not relevant.
[A] Districts sampled included only those identified by Education.
Source: GAO Analysis.
[End of table]
Because our estimates are based on samples, they are subject to
sampling error. Table 15 shows each of our estimates and indicates the
extent of each estimate‘s sampling error by showing the 95-percent
confidence interval around that estimate. There is a 95-percent chance
that the actual total falls within the interval.
Table 15: Sampling Errors:
Percentage of School districts[A] prioritizing primary schools:
Sampling error[B] (percentage points): 4.
Percentage of School districts prioritizing poverty rankings:
Sampling error[B] (percentage points): 3.
Percentage of School districts preserving funds for districtwide
activities:
Sampling error[B] (percentage points): 5.
Percentage of Urban school districts prioritizing primary schools:
Sampling error[B] (percentage points): 14.
Percentage of Urban school districts prioritizing poverty rankings:
Sampling error[B] (percentage points): 13.
Percentage of Rural school districts prioritizing primary schools:
Sampling error[B] (percentage points): 6.
Percentage of Rural school districts prioritizing poverty rankings
Sampling error[B] (percentage points): 4.
[A] School district officials self-identified their districts as urban,
rural, suburban, or mixed.
[B] At the 95-percent confidence interval.
Source: GAO Analysis.
[End of table]
Interviews With Federal Officials and Education Experts:
During our work, we consulted with representatives from the following
agencies and organizations who have knowledge of the Title I program
and related issues: U.S. Department of Education, U.S. Department of
Agriculture, National Research Council, U.S. Census Bureau‘s Small-Area
Income and Poverty Estimates Panel, Congressional Research Service,
Council of Chief State School Officers, Center on Education Policy,
American Association of School Administrators, Council of the Great
City Schools, and the National Association of State Title I Directors.
[End of section]
Appendix II: Supporting Data:
Variation in Funding Per Child Under Alternative Hold-Harmless Rules by
Poverty Groups:
Local school districts were put into one of five groups with each group
containing an equal number of poor children. The groups ranged from the
lowest percentages of poverty to the highest percentages of poverty.
Each group represents approximately 20 percent of all formula eligible
children.[Footnote 44] For this analysis, we expressed the number of
formula-eligible children as a percentage of the number of children
ages 5-17. Table 16 shows the average funding per child allotted by
formula, formula allotments under each of the simulations, and percent
differences in funding per child compared to 2001 formula allotments.
Table 16: District Funding Per Child by Poverty Group:
Poverty group: 2001 formula allocation: Dollars per child;
Lowest (no more than 15% poverty): $758;
Low (15-21% poverty): $821;
Medium (21-29% poverty): $826;
High (29-40% poverty): $865;
Highest (40-100% poverty): $864;
Ratio (highest to lowest): 114%.
Poverty group: 100-percent hold-harmless: Dollars per child;
Lowest (no more than 15% poverty): $751;
Low (15-21% poverty): $816;
Medium (21-29% poverty): $824;
High (29-40% poverty): $869;
Highest (40-100% poverty): $867;
Ratio (highest to lowest): 115%.
Poverty group: 100-percent hold-harmless: Percentage difference;
Lowest (no more than 15% poverty): -0.8%;
Low (15-21% poverty): -0.6%;
Medium (21-29% poverty): -0.2%;
High (29-40% poverty): 0.5%;
Highest (40-100% poverty): 0.3%.
Poverty group: Authorizing hold-harmless: Dollars per child;
Lowest (no more than 15% poverty): $734;
Low (15-21% poverty): $826;
Medium (21-29% poverty): $823;
High (29-40% poverty): $867;
Highest (40-100% poverty): $878;
Ratio (highest to lowest): 120%.
Poverty group: Authorizing hold-harmless: Percentage difference;
Lowest (no more than 15% poverty): -3.1%;
Low (15-21% poverty): 0.6%;
Medium (21-29% poverty): -0.4%;
High (29-40% poverty): 0.3%;
Highest (40-100% poverty): 1.6%.
Poverty group: No hold-harmless: Dollars per child;
Lowest (no more than 15% poverty): $739;
Low (15-21% poverty): $829;
Medium (21-29% poverty): $820;
High (29-40% poverty): $853;
Highest (40-100% poverty): $885;
Ratio (highest to lowest): 120%.
Poverty group: No hold-harmless: Percentage difference;
Lowest (no more than 15% poverty): -2.4%;
Low (15-21% poverty): 0.9%;
Medium (21-29% poverty): -0.7%;
High (29-40% poverty): -1.3%;
Highest (40-100% poverty): 2.5%.
Note: Even though these groups represent equal percentages of children,
they represent unequal ranges in terms of percentage of poverty.
Source: GAO Analysis.
[End of table]
Table 17 shows the coefficients of variation for figure 5.
Table 17: Variation in Funding Per Child Within Poverty Groups:
Poverty group: 2001 formula coefficient of variation (CoV);
Lowest (no more than 15% poverty): 30%;
Low (15-21% poverty): 21%;
Medium (21-29% poverty): 19%;
High (29-40% poverty): 17%;
Highest (40-100% poverty): 19%.
Poverty group: 100-percent hold-harmless: CoV;
Lowest (no more than 15% poverty): 32%;
Low (15-21% poverty): 21%;
Medium (21-29% poverty): 20%;
High (29-40% poverty): 18%;
Highest (40-100% poverty): 19%.
Poverty group: 100-percent hold-harmless: Percentage difference[A];
Lowest (no more than 15% poverty): 3.8%;
Low (15-21% poverty): 4.1%;
Medium (21-29% poverty): 3.3%;
High (29-40% poverty): 3.3%;
Highest (40-100% poverty): 3.2%.
Poverty group: Authorizing hold-harmless: CoV;
Lowest (no more than 15% poverty): 20%;
Low (15-21% poverty): 14%;
Medium (21-29% poverty): 15%;
High (29-40% poverty): 15%;
Highest (40-100% poverty): 16%.
Poverty group: Authorizing hold-harmless: Percentage difference[A];
Lowest (no more than 15% poverty): -33.3%;
Low (15-21% poverty): -30.0%;
Medium (21-29% poverty): -21.2%;
High (29-40% poverty): -13.6%;
Highest (40-100% poverty): -15.6%.
Poverty group: No hold-harmless: CoV;
Lowest (no more than 15% poverty): 16%;
Low (15-21% poverty): 13%;
Medium (21-29% poverty): 14%;
High (29-40% poverty): 14%;
Highest (40-100% poverty): 16%.
Poverty group: No hold-harmless: Percentage difference[A];
Lowest (no more than 15% poverty): -48.9%;
Low (15-21% poverty): -34.3%;
Medium (21-29% poverty): -28.9%;
High (29-40% poverty): -17.1%;
Highest (40-100% poverty): -15.8%.
[A] Percentage differences calculated based on unrounded numbers.
Source: GAO Analysis.
[End of table]
Table 18 shows the data used to construct figure 6.
Table 18: Percentage Change in Funding With No Hold-Harmless, Analysis
by Changes in State Poverty 2001-2002 (States Ranked by Percentage
Growth in the Number of Poor Children):
State: Alaska;
Percentage change in formula-eligible children: 39.6;
Percentage change in Title I funding: 0.9.
State: Utah;
Percentage change in formula-eligible children: 35.2;
Percentage change in Title I funding: -6.8;
State: Nevada;
Percentage change in formula-eligible children: 24.6;
Percentage change in Title I funding: 6.9.
State: New Hampshire;
Percentage change in formula-eligible children: 22.1;
Percentage change in Title I funding: -14.3.
State: Massachusetts;
Percentage change in formula-eligible children: 20.1;
Percentage change in Title I funding: 1.8.
State: Hawaii;
Percentage change in formula-eligible children: 17.8;
Percentage change in Title I funding: 7.0.
State: Maryland;
Percentage change in formula-eligible children: 16.4;
Percentage change in Title I funding: 4.6.
State: New Jersey;
Percentage change in formula-eligible children: 14.8;
Percentage change in Title I funding: 2.4.
State: Colorado;
Percentage change in formula-eligible children: 13.5;
Percentage change in Title I funding: 2.9.
State: Idaho;
Percentage change in formula-eligible children: 12.5;
Percentage change in Title I funding: -2.3.
State: Minnesota;
Percentage change in formula-eligible children: 11.9;
Percentage change in Title I funding: 1.4.
State: Washington;
Percentage change in formula-eligible children: 11.0;
Percentage change in Title I funding: 1.9.
State: Connecticut;
Percentage change in formula-eligible children: 10.8;
Percentage change in Title I funding: 5.6.
State: California;
Percentage change in formula-eligible children: 8.7;
Percentage change in Title I funding: 4.3.
State: Virginia;
Percentage change in formula-eligible children: 8.7;
Percentage change in Title I funding: 6.2.
State: Oregon;
Percentage change in formula-eligible children: 8.6;
Percentage change in Title I funding: 3.1.
State: Delaware;
Percentage change in formula-eligible children: 8.4;
Percentage change in Title I funding: -16.5.
State: Arizona;
Percentage change in formula-eligible children: 6.4;
Percentage change in Title I funding: 4.1.
State: Indiana;
Percentage change in formula-eligible children: 5.9;
Percentage change in Title I funding: 3.3.
State: Kansas;
Percentage change in formula-eligible children: 4.9;
Percentage change in Title I funding: 3.2.
State: Rhode Island;
Percentage change in formula-eligible children: 4.4;
Percentage change in Title I funding: 6.2.
State: Iowa;
Percentage change in formula-eligible children: 3.3;
Percentage change in Title I funding: -9.6.
State: Georgia;
Percentage change in formula-eligible children: 1.4;
Percentage change in Title I funding: 6.4.
State: Wyoming;
Percentage change in formula-eligible children: 1.3;
Percentage change in Title I funding: -9.1.
State: North Dakota;
Percentage change in formula-eligible children: 1.0;
Percentage change in Title I funding: -10.1.
State: Nebraska;
Percentage change in formula-eligible children: 0.2;
Percentage change in Title I funding: -13.2.
State: Illinois;
Percentage change in formula-eligible children: -0.1;
Percentage change in Title I funding: 2.2.
State: New York;
Percentage change in formula-eligible children: -0.3;
Percentage change in Title I funding: 3.8.
State: North Carolina;
Percentage change in formula-eligible children: -0.4;
Percentage change in Title I funding: 5.2.
State: Montana;
Percentage change in formula-eligible children: -0.9;
Percentage change in Title I funding: -0.8.
State: Wisconsin;
Percentage change in formula-eligible children: -1.0;
Percentage change in Title I funding: -3.2.
State: Florida;
Percentage change in formula-eligible children: -2.1;
Percentage change in Title I funding: 5.6.
State: South Carolina;
Percentage change in formula-eligible children: -2.3;
Percentage change in Title I funding: 3.7.
State: Michigan;
Percentage change in formula-eligible children: -3.1;
Percentage change in Title I funding: -3.5.
State: Pennsylvania;
Percentage change in formula-eligible children: -5.1;
Percentage change in Title I funding: -4.8.
State: Oklahoma;
Percentage change in formula-eligible children: -6.6;
Percentage change in Title I funding: -1.2.
State: Alabama;
Percentage change in formula-eligible children: -6.9;
Percentage change in Title I funding: -5.2.
State: Ohio;
Percentage change in formula-eligible children: -7.1;
Percentage change in Title I funding: -10.7.
State: South Dakota;
Percentage change in formula-eligible children: -7.2;
Percentage change in Title I funding: -4.7.
State: Arkansas;
Percentage change in formula-eligible children: -7.3;
Percentage change in Title I funding: -4.5.
State: Missouri;
Percentage change in formula-eligible children: -7.7;
Percentage change in Title I funding: -4.0.
State: Kentucky;
Percentage change in formula-eligible children: -7.8;
Percentage change in Title I funding: -3.8.
State: Texas;
Percentage change in formula-eligible children: -8.1;
Percentage change in Title I funding: -0.4.
State: Maine;
Percentage change in formula-eligible children: -8.7;
Percentage change in Title I funding: -9.2.
State: District of Columbia;
Percentage change in formula-eligible children: -8.8;
Percentage change in Title I funding: 6.3.
State: Tennessee;
Percentage change in formula-eligible children: -11.2;
Percentage change in Title I funding: -13.5.
State: Vermont;
Percentage change in formula-eligible children: -11.3;
Percentage change in Title I funding: -8.4.
State: New Mexico;
Percentage change in formula-eligible children: -11.7;
Percentage change in Title I funding: 0.7.
State: Louisiana;
Percentage change in formula-eligible children: -16.0;
Percentage change in Title I funding: -13.8.
State: West Virginia;
Percentage change in formula-eligible children: -17.1;
Percentage change in Title I funding: -11.9.
State: Mississippi;
Percentage change in formula-eligible children: -19.9;
Percentage change in Title I funding: -28.9.
Source: GAO Analysis.
[End of table]
Replacing State Per-We analyzed three formula scenarios that replaced
the state per-pupil spending factor with an alternative cost factor
developed by the Pupil Expenditure Department of Education: a state-
level cost factor, a district-level cost Factor With a Cost of factor,
and a district-level cost factor combined with the hold-harmless rules
described in the authorizing statute. Table 19 reports the average
Education Factor funding per child in each poverty group and table 20
reports the coefficients of variation in funding per child within each
group that were reported in figure 7 of the report.
Table 19: Funding Per Child by Poverty Group Under Formula Options That
Replace State Per-Pupil Spending With a Cost of Education Factor:
Poverty group: 2001 formula allocation: Dollars per child;
Lowest (no more than 15% poverty): $758;
Low (15-21% poverty): $821;
Medium (21-29% poverty): $826;
High (29-40% poverty): $865;
Highest (40-100% poverty): $864;
Ratio (highest to lowest): 114%.
Poverty group: State cost factor: Dollars per child;
Lowest (no more than 15% poverty): $737;
Low (15-21% poverty): $815;
Medium (21-29% poverty): $825;
High (29-40% poverty): $866;
Highest (40-100% poverty): $892;
Ratio (highest to lowest): 121%.
Poverty group: State cost factor: Percentage difference;
Lowest (no more than 15% poverty): -2.7%;
Low (15-21% poverty): -0.8%;
Medium (21-29% poverty): 0.0%;
High (29-40% poverty): 0.1%;
Highest (40-100% poverty): 3.3%.
Poverty group: District cost factor: Dollars per child;
Lowest (no more than 15% poverty): $746;
Low (15-21% poverty): $815;
Medium (21-29% poverty): $821;
High (29-40% poverty): $866;
Highest (40-100% poverty): $887;
Ratio (highest to lowest): 119%.
Poverty group: District cost factor: Percentage difference;
Lowest (no more than 15% poverty): -1.6%;
Low (15-21% poverty): -0.8%;
Medium (21-29% poverty): -0.5%;
High (29-40% poverty): 0.1%;
Highest (40-100% poverty): 2.7%.
Poverty group: District cost factor & authorizing hold-harmless:
Dollars per child;
Lowest (no more than 15% poverty): $716;
Low (15-21% poverty): $818;
Medium (21-29% poverty): $818;
High (29-40% poverty): $873;
Highest (40-100% poverty): $905;
Ratio (highest to lowest): 126%.
Poverty group: District cost factor & authorizing hold-harmless:
Percentage difference;
Lowest (no more than 15% poverty): -5.4%;
Low (15-21% poverty): -0.5%;
Medium (21-29% poverty): -1.0%;
High (29-40% poverty): 0.9%;
Highest (40-100% poverty): 4.7%.
Source: GAO Analysis.
[End of table]
Table 20: Variation in Funding Per Child Within Poverty Groups Under
Formula Options That Replace State Per-Pupil Spending With a Cost of
Education Factor:
Poverty group: 2001 formula coefficient of variation (CoV);
Lowest (no more than 15% poverty): 30%;
Low (15-21% poverty): 21%;
Medium (21-29% poverty): 19%;
High (29-40% poverty): 17%;
Highest (40-100% poverty): 19%.
Poverty group: State cost factor: CoV;
Lowest (no more than 15% poverty): 30%;
Low (15-21% poverty): 19%;
Medium (21-29% poverty): 17%;
High (29-40% poverty): 15%;
Highest (40-100% poverty): 13%.
Poverty group: State cost factor: Percentage difference;
Lowest (no more than 15% poverty): -0.5%;
Low (15-21% poverty): -5.9%;
Medium (21-29% poverty): -10.1%;
High (29-40% poverty): -13.3%;
Highest (40-100% poverty): -29.7%.
Poverty group: District cost factor: CoV;
Lowest (no more than 15% poverty): 30%;
Low (15-21% poverty): 20%;
Medium (21-29% poverty): 18%;
High (29-40% poverty): 16%;
Highest (40-100% poverty): 14%.
Poverty group: District cost factor: Percentage difference;
Lowest (no more than 15% poverty): -1.3%;
Low (15-21% poverty): -3.7%;
Medium (21-29% poverty): -4.3%;
High (29-40% poverty): -9.2%;
Highest (40-100% poverty): -25.0%.
Poverty group: District cost factor & authorizing hold-harmless: CoV;
Lowest (no more than 15% poverty): 19%;
Low (15-21% poverty): 12%;
Medium (21-29% poverty): 13%;
High (29-40% poverty): 13%;
Highest (40-100% poverty): 10%.
Poverty group: District cost factor & authorizing hold-harmless:
Percentage difference;
Lowest (no more than 15% poverty): -36.1%;
Low (15-21% poverty): -40.1%;
Medium (21-29% poverty): -30.4%;
High (29-40% poverty): -26.3%;
Highest (40-100% poverty): -44.6%.
Source: GAO Analysis.
[End of table]
[End of section]
Appendix III: Selected Provisions of the ’No Child Left Behind Act of
2001“ and Related Appropriations:
On January 8, 2002, President Bush signed into law the ’No Child Left
Behind Act of 2001,“ reauthorizing Title I and other Elementary and
Secondary Education Act programs, with some significant changes.
[Footnote 45] Two days later, he signed the related appropriations law.
[Footnote 46] The changes to Title I relevant to this report are
outlined below:
Funding for Targeted Grant Formula: For the first time, the Congress
appropriated funds for targeted grants. The 2001 Act requires that the
amounts allocated through basic and concentration grants are to be the
same as they were in fiscal year 2001 and that any additional funds
remaining (i.e., any new funds) are to be allocated through the
targeted grant formula. As under prior law, a tiered weighting system
would provide proportionately greater funding per poor child to
districts with higher numbers and percentages of poor children. The new
law changed the cut-points between the tiers slightly, based on updated
Census poverty estimates, so that each tier would continue to contain
roughly equal numbers of poor children.
Funding for Revised Finance Incentive Grant Formula: Not only was the
finance incentive grant funded for the first time, but the grant
formula and other provisions also were significantly revised. In prior
law, the incentive grant formula was designed to provide additional
funds to states that demonstrated high state education spending
relative to their tax base and states that had less disparity in
funding among districts. The new law maintains these provisions and
adds several more that give proportionately more funds to states and
districts with higher numbers and percentages of poor children, as
follows:
* Allocations will be based on each state‘s number of poor children,
rather than its total school-age population.
* Districts are required to have at least 10 poor children, making up
at least 5 percent of enrollment to qualify for finance incentive
funds, whereas there had been no such enrollment requirement in prior
law.
* Allocations will be made to school districts on the basis of a tiered
weighting system, like that in the targeted grant formula. The
incentive grant weighting system provides proportionally more funds not
only to districts with greater numbers and percentages of poor children
but also to districts in states with less funding disparity among
districts.
* Districts are newly required to allocate finance incentive funds to
schools in the same way that they allocate the other Title I funds
(e.g., in rank order of poverty) and to use finance incentive funds
only for Title I purposes.
In addition, the new formula includes a per-pupil expenditure factor,
like that for the other grants, but more narrowly limited to a minimum
of 34 percent and a maximum of 46 percent of the national average per
pupil expenditure, rather than the 32 percent minimum and 48 percent
maximum in the other grant formulas.
Increased Overall Funding for Fiscal Year 2002: The education
appropriations legislation includes a combined increase of nearly $1.8
billion in funding for Title I basic, concentration, targeted, and
finance incentive grants. (See table 21)
Table 21: Change in Title I Appropriations Between Fiscal Years 2001
and 2002 (Thousands of dollars):
Basic grants:
FY 2001: $7,237,721;
FY 2002: $7,172,971;
Percent increase FY 2001-2002: -0.89.
Concentration grants:
FY 2001: $1,364,000;
FY 2002: $1,365,031;
Percent increase FY 2001-2002: 0.08.
Targeted grants:
FY 2001: 0;
FY 2002: $1,018,499;
Percent increase FY 2001-2002: N/A.
Finance incentive grants:
FY 2001: 0;
FY 2002: $793,499;
Percent increase FY 2001-2002: N/A.
Total:
FY 2001: $8,601,721;
FY 2002: $10,350,000;
Percent increase FY 2001-2002: 20.32.
Source: Public Law 106-554 (Consolidated Appropriations Act, 2001),
Public Law 107-20 (Supplemental Appropriations Act, 2001), and Public
Law 107-116 (Appropriations Act, 2002).
[End of table]
Hold-Harmless: The prior authorizing legislation included a hold-
harmless provision only for basic grants (districts were guaranteed 85,
90, or 95 percent of the previous year‘s funding, depending on
percentage of poor children in the district). However, as described in
the body of the report, appropriations language in recent years created
more restrictive hold-harmless provisions, including (1) a 100-percent
hold-harmless provision for basic grants and (2) a hold-harmless
provision for concentration grants that allowed even districts no
longer meeting the concentration grant eligibility criteria to continue
receiving concentration grants. In contrast, the fiscal year 2002
appropriations language does not include any provisions that override
the authorized hold-harmless provisions. However, under the new
authorizing legislation, hold-harmless provisions will apply not only
to basic grants but also to concentration grants and targeted grants.
In addition, under the new authorizing legislation, districts that
become ineligible for concentration grants will continue to receive
concentration grant allocations for up to 4 consecutive years.
As a result of these changes, operative hold-harmless provisions for
basic grants are somewhat less restrictive than under prior law and,
therefore, will allow basic grant allocations to be more reflective of
the number of poor children in a school district. Likewise, the newly
authorized hold-harmless provisions for concentration grants are
somewhat less restrictive than the hold-harmless provisions previously
included in appropriations law. In the end, allocations under these
grants will be more reflective of numbers of poor children than in the
past, but not as reflective of them as would have been the case under
the prior authorizing legislation alone.
Small State Minimum: The minimum level of funding guaranteed to each
state is increased over prior law. Previously, each state was
guaranteed the smaller of 0.25 percent of total appropriations for that
year, or the average of that amount and the state‘s number of eligible
students multiplied by 150 percent of the national average per-pupil
payment. The new law uses essentially the same calculation but instead
of 0.25 percent of the total appropriations, the new calculation will
use 0.25 percent of the amount appropriated in 2001, plus 0.35 percent
of any subsequent increases in appropriations over the 2001 level.
Other Funding Details:
* States are required to reserve 2 percent of their Title I funds for
school improvement, increasing to 4 percent in fiscal year 2004.
Previously, states were permitted, but not required, to reserve up to
0.5 percent of their funds for school improvement. States must pass at
least 95 percent of these funds directly to school districts.
* Districts must continue to reserve at least 1 percent of their Title
I allocations for parental involvement activities, as was required
under prior law, but the new law also requires that they pass 95
percent of these reserved funds to Title I schools.
* Districts may use Title I funds for schoolwide programs, rather than
targeting funds to specific students, in schools where at least 40
percent of the children in the school or school attendance area are
from low-income families. Previously, schoolwide programs were allowed
only in schools in which at least 50 percent of the children in the
school or school attendance area were from low-income families.
[End of section]
Appendix IV: Comments From the Department of Education:
United States Department Of Education:
The Deputy Secretary:
400 Maryland Ave. S.W.
Washington, D.C. 20202-0500:
"Our mission is to ensure equal access to education and to promote
educational excellence throughout the Nation."
January 18, 2002:
Marnie S. Shaul:
Director:
Education, Workforce, and Income Security Issues:
U.S. General Accounting Office:
Washington, DC 20548:
Dear Ms. Shaul:
We have reviewed GAO's draft report entitled Title I Funding: Poor
Children Benefit Though Funding Per Poor Child Differs and we
appreciate the thorough and useful analysis carried out by GAO staff.
We agree with GAO's finding that Title I funds are generally targeted
to higher-poverty districts and schools but that this targeting could
be improved. In particular, as the GAO report points out, hold-harmless
provisions have limited the extent to which Title I funds follow poor
children when geographic shifts in poverty occur. Although the Census
Bureau now provides updated poverty data every two years (and the new
reauthorization calls for annual updates), enabling the Department to
use more current data for allocating Title I funds, these new data have
had little effect on Title I allocations due to the restrictions
imposed by 100 percent hold-harmless provisions included in every
appropriations act since fiscal year 1997 (with the exception of the
most recent appropriations for fiscal year 2002). As a result, States
that have experienced growth in their numbers of poor children have
suffered declines in their relative shares of Title I funding per poor
child.
The GAO report points out the wide disparities across States in Title I
funding per poor child, ranging from a high of $1,150 in Vermont to a
low of $520 in New Mexico. Indeed, the Nation's poorest States receive
some of the lowest allocations per poor child. GAO notes that these
disparities are partly due to the use of State per-pupil expenditure
factor (intended to adjust for interstate differences in the cost of
education), as well as small-State minimum and hold-harmless
provisions. GAO suggests that an alternative cost indicator would
direct more funding to districts with higher percentages of poor
children and might more accurately reflect educational costs. Although
the Department has not fully examined GAO's specific suggestions for
increasing the targeting of Title I funds, we strongly support the
general goal expressed in the No Child Left Behind Act of "targeting
resources sufficiently to make a difference to local educational
agencies and schools where the needs are greatest."
The report should be updated to reflect the fiscal 2002 appropriations
act which funded the Targeted Grants and Incentive Grants formulas for
the first time and, unlike previous years' acts, did not include hold-
harmless language. It should also reflect the passage of the No Child
Left Behind Act, which revised the Incentive Grants formula to allocate
funds on the basis of poverty, consistent with the other Title I
formulas.
Thank you for the opportunity to comment on this draft report.
Sincerely,
Signed by:
William D. Hansen:
[End of section]
Appendix V: Comments From the U.S. Department of Agriculture:
USDA:
United States Department of Agriculture:
Food and Nutrition Service:
3101 Park Center Drive:
Alexandria, VA 22302-1500:
January 22, 2002:
To: Marnie Shaul:
Director:
Education, Workforce, and Income Security Issues:
General Accounting Office:
From: [Signed by] George A. Braley:
Acting Administrator:
Subject: Comments on GAO Report: "Title I Funding: Poor Children
Benefit Though Funding Per Poor Child Differs."
An objective of this report is to assess the extent to which Title I
funds are allocated to states, school districts, and schools with the
greatest numbers and percentages of school-age poor children. In its
analysis, GAO uses data on approvals for free and reduced price meals
in the National School Lunch Program (NSLP) as a measure of poverty at
both the school and district level. The Food and Nutrition Service
(FNS) recognizes that NSLP free and reduced price data is often used in
this manner for both analytical and operational purposes. However, FNS
has become increasingly aware of the limitations of this data as a
measure of low income status. Information from a variety of sources
indicates that many students who are above the NSLP income eligibility
limits (130 and 185 percent of poverty) are approved for free or
reduced price meals. We believe that this has important implications
for the targeting of Title I funds which GAO should consider in this
report.
School Level Allocations: Free and reduced price data is overwhelmingly
the predominant source used by districts to allocate Title I funds
among schools. GAO's current draft states that "the subsidized school
lunch program provides the best available source of data on low-income
students at the school level" and does not comment further on its
accuracy for school-level allocations. We believe, however, that error
in NSLP data is likely contributing to inaccuracies in Title I funds
allocation, particularly because of the "threshold" approach reflected
in the district allocation process. Schools above a given percentage of
enrollment approved for free and/or reduced price meals receive funding
while those below this percentage do not. If some schools only meet the
threshold because ineligible students are included in the free and
reduced price counts, then funds are being diverted from needier
schools whose true eligibility levels meet the threshold.
District Level Allocations: NSLP free and reduced price data are not
important determinants of district-level Title I allocations. However,
the draft report does use these data as a measure of district level
poverty, and notes in several places that such data are closely linked
to district-level poverty levels. FNS does not believe that this
relationship is as strong or consistent as a reader of this draft might
conclude. For example, FNS will soon be releasing data on free and
reduced approvals which suggests significant variation in its accuracy
(and thus its accuracy as a proxy for poverty) among school districts.
Further, the NAS study cited in this report as evidence of this
relationship was based on a very small sample of districts, and the NAS
itself noted that further assessment is needed.
To summarize, we believe that in order to present a full assessment of
the accuracy of Title I targeting to low-income schools and districts,
the report should address these issues. We would be happy to discuss
these comments with you further.
[End of section]
Appendix VI: GAO Contacts and Staff Acknowledgments:
GAO Contacts:
Jeff Appel, (202) 512-9915:
Heather McCallum, (202) 512-2890:
Staff Acknowledgments:
In addition to those named above, the following people made significant
contributions to this report: Natalie Britton, Karen Brown, Patrick
DiBattista, Robert Dinkelmeyer, Jerry Fastrup, Sarah Glavin, Sonya
Harmeyer, Peter Minarik, and Michael Williams. Jon Barker, Richard
Burkard, and Robert Parker also provided key technical assistance.
[End of section]
Footnotes:
[1] Throughout this report, we refer to Title I, Part A of the
Elementary and Secondary Education Act as ’Title I.“ Other Parts of
Title I (Parts B, C, and D) are targeted at specific populations and
are commonly referred to by their program names (Even Start, Migrant
Education, and grants for Neglected and Delinquent Children).
[2] The districts appearing in Education‘s database for the 1999-2000
school year were the districts as they were configured in 1995.
[3] In March 2001, we briefed officials on the Authorizing and
Appropriations Committees on the preliminary results of this work.
[4] In addition to poverty, standards used to classify children as
Title I-eligible include participation in the Temporary Assistance for
Needy Families (TANF) program and being a child in a foster home or in
a locally operated institution for neglected and delinquent children.
Collectively, these children are called ’formula-eligible children.“
Unless otherwise noted, in this report, ’poor children“ is used to
refer to children who are poor as measured by Census data or, when
indicated, children eligible for free or reduced-price lunch. Ninety-
six percent of all children classified as formula-eligible would also
be classified as eligible for Title I using Census poverty estimates.
[5] Although the districts receiving basic grants and concentration
grants contain about 99 and 85 percent of poor children, respectively,
only about 27 percent of all public school students are affected by
Title I services. School districts distribute their allocations to a
limited number of their schools, which provide services to a limited
number of their students.
[6] Legislation signed by President Bush in January 2002 funds these
grants beginning in school year 2002-03.
[7] Legislation signed by President Bush in January 2002 funds these
grants beginning in school year 2002-03.
[8] In other words, expenditures would be limited to a minimum of 32
percent and a maximum of 48 percent of the national average
expenditure.
[9] For concentration grants, that last term in the average is the
greater of the state‘s number of eligible children multiplied by 150
percent of the national average per-pupil payment, or the amount
$340,000.
[10] However, if the hold-harmless level were less than 100 percent and
poverty data remained stable, funding would eventually fully adjust to
the distribution of low-income children.
[11] The appropriations‘ provisions entitle a state to receive 100
percent of its previous year‘s funding regardless of the number of
districts in that state that meet the minimum eligibility requirements.
In cases where there are individual districts within a state that no
longer meet the eligibility requirements for a particular grant, the
state‘s full grant amount gets distributed among the qualifying
districts for that year.
[12] If the total appropriation for the program is not large enough to
fully fund the larger of these two amounts, then every district‘s
allotment is reduced proportionally. This allows more of the Title I
appropriation to be distributed on the basis of the poverty criteria in
the formula.
[13] Districts with fewer than 1,000 children enrolled are exempt from
this requirement.
[14] As long as the districts use the same measure of poverty across
all schools, they can choose to use free and reduced-price lunch,
Medicaid, TANF, or other measures. The measure used by the district
does not have to be the same measure as that used by the state or the
federal government in allocating funds.
[15] In this report, analyses of numbers of poor children at the school
level include only children in public schools.
[16] This relationship holds true whether poverty is measured using
Census data or the number of children receiving free or reduced-price
lunch. The subsidized lunch program provides a looser definition of
’poverty“ than the Census poverty data. Eligibility for free lunches is
set at 130 percent of the official poverty line ($22,165 for a family
of four during the 2000-01 school year), and eligibility for reduced-
price lunches extends up to 185 percent of the poverty line ($31,543
for a family of four during the 2000-01 school year). The number of
students eligible for subsidized lunches is roughly double the number
meeting the Census poverty definition. Nonetheless, according to the
Department of Education, the subsidized lunch program provides the best
available source of data on low-income students at the school level.
[17] We examined this issue using basic grants alone, rather than
combining basic and concentration grants, because many districts that
receive basic grants do not receive concentration grants and should not
be included in a state-level analysis with those that receive both
grants. Nonetheless, an examination of concentration grants alone
showed that they, too, were unevenly distributed across states and
eligible districts - a point that is discussed later in this report.
[18] Poor children in these analyses are children eligible for free or
reduced-price lunch. We used subsidized lunch eligibility for this
analysis because these data are available for a greater number of
school districts than are Census data.
[19] In these examples, poverty was measured as eligibility for free or
reduced-price lunch.
[20] In general, there is a strong relationship at the district level
between the number of children eligible for free and reduced-price
lunch and the number of children denoted by the Census as living in
poverty. However, among urban districts that relationship is closer to
a one-to-one relationship than in rural districts. In rural districts,
the relationship approaches a two-to-one relationship, that is two
children are identified as eligible for free or reduced-price lunch for
every one child denoted by the Census as living in poverty.
[21] Education classifies school districts into eight location types.
These are: (1) large central city, (2) mid-size central city, (3) urban
fringe of large city, (4) urban fringe of mid-size city, (5) large
town, (6) small town, (7) rural-outside a metropolitan area, and (8)
rural-inside a metropolitan area. In our analysis, classes (1) and (2)
are considered ’urban,“ and classes (7) and (8) are considered ’rural.“
[22] The enrollments of the charter schools ranged to a high of 2,099
students. Therefore, actual allocations to charter schools were
compared with those for other school districts with fewer than 2,500
students. Census poverty data are unavailable for charter schools, so
all analysis used free or reduced-price lunch eligibility as the
measure of poverty. Charter schools that are independent school
districts in Wisconsin and Illinois were not considered in the analysis
as the three such charter schools in Illinois were not funded in 1999-
2000, and only one of the two such charter schools in Wisconsin was
funded.
[23] Along with the District of Columbia, the 14 states were: Arizona,
California, Delaware, Illinois, Louisiana, Massachusetts, Michigan,
Minnesota, New Jersey, North Carolina, Ohio, Pennsylvania, Texas, and
Wisconsin.
[24] In addition, districts must fund all schools with poverty rates
greater than 75 percent before funding any school with a poverty rate
less than 75 percent.
[25] In responding to our survey, school district officials self-
identified their districts as urban, rural, suburban, or mixed.
[26] Confidence intervals for these estimates are provided in appendix
I.
[27] For some districts, the U.S. Department of Education approves
these waivers directly; however, under the ’Ed-Flex“ program, Education
has delegated this authority to 12 state education agencies.
[28] This shift could not be examined at the school district level
because Education did not generate school district-level allocation
amounts until the 1999-2000 school year.
[29] The effect of hold-harmless is important if the amount of Title I
funds remain the same, but if funds are increased the impact of the
hold-harmless is limited.
[30] This analysis holds constant at the 2001-02 levels, the total
funding, the hold-harmless rule and the per-pupil expenditure factor.
[31] The definition of poor child here is the poverty factor used in
the formula that includes Foster, Neglected, TANF, and Delinquent
children with the Census poverty estimates.
[32] School districts in states with growing poverty that were also
recipients of the small state minimum are nevertheless much better off.
While their grant amount per poor child would have fallen (due to a
proportionally more rapid increase in their number of poor children
than in the increase in their grant amount), the amount per poor child
of such states still exceeds that of states not benefiting from the
small state minimum.
[33] For purposes of comparison, the average grant per poor child in
2001 is $679 for basic grants and $149 for concentration grants.
[34] School Finance: State and Federal Efforts to Target Poor Students
[hyperlink, http://www.gao.gov/products/GAO/HEHS-98-36], Jan. 28, 1998.
[35] For this analysis, school districts were rank-ordered on the basis
of their numbers of low-income children and divided into five groups,
or quintiles, each containing approximately 20 percent of all low-
income children. Districts with the smallest number of children were in
the first group and districts with the greatest number of children were
in the fifth group. The size and number of the school districts in each
group differ. For example, the school districts in the first group have
numbers of poor children that range from 1 to 643 and the group
contains nearly half of all districts, while the school districts in
the fifth group have numbers of such children ranging from 26,976 to
303,122 and this group contains 6 percent of all districts. Also,
differences in funding among districts within each of the five groups
are measured by the standard deviation of the funding per child.
[36] This represents a 2-year change in the number of low-income
children. School year 2000-01 used poverty estimates for calendar year
1995, and school year 2001-02 used estimates for 1997.
[37] Using a less restrictive hold-harmless rule could also increase
the volatility of school district funding, especially among small
districts for which Census estimates of poor children contain
substantial statistical error.
[38] Studies of state spending on education (and most other public
services as well) consistently show that education spending is strongly
related to the income of state and local taxpayers. For this reason,
the use of per-pupil expenditures as an indicator of differences in the
cost of delivering educational services has been severely criticized in
the past.
[39] W. Riddle and R. Apling, Education for the Disadvantaged:
Allocation Formula Issues in ESEA Title I Reauthorization Legislation,
Congressional Research Service #RL-30492, March 20, 2000, pages 14-17.
For a general discussion of educational costs and expenditures, see
U.S. Department of Education, National Center for Education Statistics,
A Primer for Making Cost Adjustments in Education, NCES 2001–323, by
W.J. Fowler, Jr. and D.H. Monk.
[40] See Geographical Variations in Public Schools‘ Costs, National
Center For Education Statistics, Working Paper No. 98-04, February 1998
for a description of the cost factor and its methodology. We used
estimates for school year 1993-94, the latest available at the time of
this report.
[41] For example, cost-of-living and other ’amenity“ factors, such as
climate, geography, and area crime rates, could result in differing
teacher salaries when these factors differ significantly among school
districts. The inclusion of ’amenity“ factors represents a departure
from earlier experimental models that focused primarily on differences
in teacher experience and education. While controlling for amenity
factors that may affect the salaries necessary to attract teachers to
specific locations is, in principle, appropriate, the measurement
methodology behind these attempts is subject to a variety of
statistical specifications that could lead to varying results. In
addition, we did not investigate the quality of the data used in these
models. For these reasons, we have labeled these estimates as
experimental and do not endorse any particular approach.
[42] The effect of increased targeting to districts with high
percentages of poor children occurs because the correlation between per-
pupil spending and the percentage of poor children and the correlation
between the cost factor and the percentage of poor children differ.
Because these correlations can change from one year to the next, the
targeting pattern in future years may differ from that shown here.
[43] To qualify, a district must have a poverty rate of more than 2
percent and at least 10 children in poverty.
[44] Formula-eligible children are children living in poverty as
reported by the Bureau of the Census, plus Foster Children, TANF
children, Neglected Children, and Delinquent Children as reported by
the Department of Health and Human Services.
[45] Public Law 107-110.
[46] Public Law 107-116.
[End of section]
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