Money Matters

Money Matters: How the Illinois School Funding System Creates Significant Educational Inequities that Impact Most Students in the State


August 19, 2008

No single policy issue in Illinois has generated more controversy—and less action—than school funding reform. For well over three decades, various attempts at education funding reform have been brought forth, only to generate heated debate and intense media coverage, but not much in the way of meaningful reforms. By now, most are familiar with the basic complaint—Illinois fails to fund education adequately from state-based revenue, ranking 49th out of 50 states in the portion of education funded by state money.1 This in turn pushes the primary obligation for education funding down to local resources, primarily property taxes, creating great disparities between districts across Illinois, based on local property wealth.

Proponents of reform have argued that this over-reliance on local property taxes significantly underfunds schools in many property—poor communities, resulting in the children who live in those areas receiving an inadequate education. Opponents respond that education has all the resources it needs, and additional investment will not generate better academic outcomes. The sheer complexity of the state's education funding regimen makes it difficult for citizens and policymakers alike to determine which arguments have substance.

To date, much of the conversation has focused on funding and quality differentials between the wealthiest school districts and the most impoverished. Certainly, the contrasts there are striking. The untold story, however, is even more compelling. It focuses not just on the very top versus the very bottom, but rather the differentials between the wealthiest school districts in Illinois—versus the vast majority of districts that provide public education to over three-quarters of the children in our state. The data here are stark and telling, revealing meaningful differences in school funding, teacher quality and academic performance that are truly statewide.

Moreover, substantive differentials in the aforesaid categories exist when affluent districts, which are concentrated north of Interstate 80, are compared to downstate school districts. Racial inequities also emerge as a significant problem in Illinois, with African American and Hispanic children far more likely to attend schools in high poverty areas, with fewer resources, less qualified teachers and lower academic outcomes than their white peers.

Money Matters is intended to help inform this debate by: (i) first, explaining the state's basic school funding formula; and then (ii) documenting with hard data the consequences that formula has had for school districts across the state in areas of significant concern, including student achievement and teacher quality.

Topics:Tax and Budget, Illinois Budget, Education, PreK-12 Education

Tags:State Spending, Inequality, Property Tax, K-12 Education