Evidence Based Model

After seven years of implementation, including six that included New Tier Funding, or new year-over-year funding, Illinois' funding formula for K-12 Education—the Evidence Based Funding for Student Success Act, or EBF—has worked towards its promise of closing the drastic funding gaps between school in property-rich and property-poor districts,  as well as between schools in predominantly white communities and schools that serve predominantly Black and Latinx students, putting the funding responsibility on the state to ensure equity for districts with less local resources. The EBF accomplishes this by distributing new K-12 funding to those districts that are furthest away from having adequate resources, and furthest away from hitting their respective "Adequacy Targets" --which is the amount the research indicates is required to provide the level of education the students they serve need to succeed academically.

The EBF replaced a formula that was based on a one-size fits all "Foundation Level" of per-pupil funding that was both inadequate in amount and inequitable in distribution. In fact, Illinois' disinvestment had been so inadequate that local property tax revenue became the primary method from which education was funded. Now, seven years later, the EBF has drastically changed public education funding allocation and has worked to close Adequacy Funding Gaps for students across all regions of the state and from all demographics by continuing to increase the state level investment each year.

After six years of implementation, five of which included new year-over-year funding, Illinois’ school funding formula – the Evidence Based Funding for Student Success Act, or EBF – has worked towards its promise of closing Illinois’ drastic funding and achievement gaps between schools in property-rich and property-poor districts, as well as between schools in predominantly white communities and schools that serve predominantly students of color. The EBF accomplishes this by distributing new K-12 funding to those districts that are furthest away from having the resources to fund their respective “Adequacy Targets” – which is the amount the research indicates is required to provide the level of education the students they serve need to succeed academically.

The EBF replaced an old formula that was based on a one-size-fits-all “Foundation Level” of per-pupil funding that was both inadequate in amount and inequitable in distribution. Indeed, the state’s historic investment in K-12 has been so inadequate that local property tax revenue became the primary method of funding education. But after six years of the EBF, the formula has proven that it is working as intended to counter historic inequities by investing more at the state level each year, closing Adequacy Funding Gaps for students in every region of the state and of every race and ethnicity.

Beginning in 2017, Illinois decision makers replaced one of the least-equitable K-12 public education funding formulas in the country with the Evidence-Based Funding for Student Success Act, or EBF. The EBF commits to implementing best practice in school funding by investing a year-to-year increased Minimum Target Level of $300 million each fiscal year.  Illinois met the Minimum Target Level for increased year-to-year state funding of K-12 education in each of the first three fiscal years—FY 2018, 2019, and 2020—during which the EBF was implemented. That streak now stands to be broken, however, as the FY 2021 General Fund Budget, which recently passed, does not increase K-12 funding under the EBF, but rather holds it level with FY 2020.

The Impact of Underfunding the Evidence-Based Funding Formula report analyzes the steps the EBF takes when the Minimum Target Level is not satisfied and how limited or no new Tier funding would impact districts by Tier, income level, race, and geography. The report also analyzes how state funding would be allocated if the state is unable to hold funding level with the prior fiscal year, resulting in a reduction in funding for the EBF.

Illinois’ overreliance on property taxes is a result of historic shift of funding K-12 Education from the state-level to the local-level.  While many would benefit from a temporary property tax freeze, there are also costs associated with a property tax freeze—particularly when it comes to funding an adequate education for millions of Illinois school children. A property tax freeze could pose substantial costs to students across the state by limiting the amount of funding districts could receive compared to the current law in which there is no property tax freeze. Using 2019 Illinois Report Card and average year-to-year growth in: (i) K-12 funding under the EBF; (ii) property tax revenue; and (iii) funding of mandated categoricals, the short report, Potential Impact of a Property Tax Freeze on School Funding, highlights some of those consequences that a property tax freeze could have, not only on school funding, but along racial lines, as well.

On August 31, 2017, Illinois decision makers finally jettisoned one of the least-equitable K-12 public education funding formulas in the country and replaced it with the Evidence-Based Funding for Student Success Act, or EBF. The EBF represents the best practice in school funding because it ties the dollar amount taxpayers invest in schools to those educational practices which research shows actually enhance student achievement over time.  David G. Sciarra, Education Law Center, Is School Funding Fair? A National Report Card, Seventh Edition, (Newark, NJ: January 2018).

However, the current maximum investment requirement under the EBF isn’t even enough to meet the statute’s stated goal of full funding within 10 years. This in turn means that if K-12 funding only grows by the $350 million annual maximum under the statute, generations of K-12 students would continue to attend schools that lack the capacity to provide them with an adequate education.

The following issue brief identifies four different scenarios – by the number of years and amount of additional yearly investment which would be necessary – to fund the EBF on a fully inflation-adjusted basis.

After just one year of implementation, Illinois’ new school funding formula – the Evidence Based Funding for Student Success Act, or EBF – holds out the promise of closing Illinois’ drastic funding and achievement gaps both between schools in property-rich and property-poor districts, as well as between schools in predominantly white communities and schools that serve predominantly students of color. The EBF accomplishes this by focusing new K-12 funding on those districts which are furthest away from having the resources to fund their respective “Adequacy Targets” – which is the amount the research indicates is required to provide the level of education the students they serve need to succeed academically.

The old formula it replaced was based on a one-size-fits-all “Foundation Level” of per-pupil funding that was both inadequate in amount and inequitable in distribution. Indeed, the state’s historic investment in K-12 has been so inadequate that local property tax revenue became the primary method of funding education. This structurally disadvantaged school districts with lower property wealth so materially that the old formula resulted in Illinois having among the most regressive education funding systems in the country. In fact, districts serving the lowest concentration of low-income students not only had the most per-pupil funding, but raised more revenue per pupil through local property taxes alone than all other districts were able to raise from all federal, state, and local sources combined. This is contrary to the research, which shows that low-income students need greater levels of investment than their non-low-income peers to achieve academically.

The EBF is well-designed to counter that historic inequity. For instance, during the 2017-18 school year, the EBF’s first year, $366 million in new school funding was distributed as follows:

• Over 89 percent, or $326 million, went to the “Tier I” school districts, which were furthest from having adequate funding;
• $229 million, or 63 percent of new K-12 funding, went to school districts serving a student population at least 59 percent low-income, and $321 million, or 88 percent, went to districts with a student body that was at least 40 percent low-income.
• $279 million, or 76 percent of the new 2017-18 funding, went to districts that collectively educate 84 percent of all black students, and 75 percent of all Latino students, in Illinois.

In other words, in its first year, the EBF has begun to reverse Illinois’ ignoble tradition of inequitably funding public education. However, there is much more work to be done. As of Fiscal Year 2018, the vast majority of school districts in Illinois—707 districts, or 83 percent—were below their respective Adequacy Targets. All told, the Illinois State Board of Education found that at the beginning of Fiscal Year 2018, K-12 funding in Illinois was some $7.37 billion less than what the evidence indicated was needed to fund the Adequacy Target for every school district.