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Current state of school funding in North Carolina
States typically allocate their dollars for public education through a funding formula that is set by the state. The formula calculates how much a district or school will receive based on different factors, including student demographics, required resources, and local ability to pay. State funding formulas can be structured in three primary ways, or a hybrid approach using the following:
- Student-based: School districts receive funding based on the number of students, usually with weights or supplements based on anticipated student learning needs
- Resource-based: School districts receive funding based on the anticipated cost of resources and inputs, such as staff salaries and instructional materials
- Program-based: This system allocates dollars to school districts based on the cost of educational programs within those districts
North Carolina currently utilizes a hybrid formula, utilizing both resource-based and program-based allocations for its school districts. The state uses an allotment system to allocate dollars to districts based on legislation, which is laid out in its Allotment Policy Manual.
In 2023, Senators Michael Lee, Amy Galey, and Lisa Barnes sponsored a bill that would convert North Carolina’s funding formula to a weighted student funding (WSF) model.
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An overview of weighted student funding
Nationally, 41 states use student-based funding in their formula. Weighted, student-based funding formulas allocate additional funding for students with greater need. These formulas include a base funding amount plus funding for students with additional needs, including economically disadvantaged students, English language learners, and students with disabilities. The base funding amount is the cost of educating a student without additional needs.
While the formula determines how much a district will receive, states may also split this cost with local revenue. For example, in a wealthier district, local revenue may pay for 90% of the formula allocation and state revenue may pay for 10%, whereas a low-wealth district might pay 10% of the cost and receive the remaining 90% from the state.
How do weighted student funding formulas work?
Weighted student funding amounts are determined by a base amount plus additional weighted amounts based on student categories. For example, a WSF formula that includes a weight for economically disadvantaged students and special education services would look like the following:
Common weights and categories in weighted student funding formulas
Bellwether core components
Bellwether is a national nonprofit organization that has developed four core components to assess state funding formulas:
Adequacy
- Is there enough funding in the system to enable schools to meet the state’s educational mandate?
- Does the policy fulfill and protect the state’s constitutional responsibilities to oversee an education system that can serve every child?
Equity
- Does the policy allocate greater resources toward groups of students with greater educational needs?
- Does it differentiate between wealthy and less-wealthy communities to ensure that limited state dollars are used where they are needed most?
Responsibility
- Does the policy make clear the locus of decision-making for funding and budgeting, and split local and state responsibilities appropriately?
Transparency
- Are the policies clear on which government entities are responsible for education revenue?
Public School Forum weighted student funding learning and collaborative session
Beginning in May 2024, the Public School Forum has hosted three collaborative sessions on Weighted Student Funding in North Carolina. The Forum has worked with Bellwether and EdTrust Tennessee to learn from and share their expertise and experience in this work.
The sessions have brought together over 80 education leaders, including 15 superintendents, representatives from Republican and Democratic Offices in the General Assembly, the Department of Public Instruction, the State Board of Education, and statewide education associations and nonprofits.
State examples of weighted student funding models
Tennessee
In 2021, Tennessee Governor Bill Lee announced that the state would review the state funding formula, leading to the adoption of a weighted student funding model in April 2022 under the Tennessee Investment in Student Achievement Act (TISA). The new model was implemented in the 2023-24 school year.
TISA’s formula includes a base amount of $6,900 with additional funding weights for English language learners, economically disadvantaged students, students with disabilities, and students who attend school in small or sparsely populated districts. In total, TISA includes approximately a $1 billion increase in funding for local public schools in Tennessee.
A full guide to TISA, including weights and calculations, is available here.
Mississippi
In April 2024, Mississippi passed a new Mississippi Student Funding Formula (MSFF) along with an additional $240 million to account for the changes in the formula. MSFF includes a base amount of $6,700 with additional funding weights for low-income students, English language learners, students with disabilities, CTE students, and students in districts with concentrated poverty.
More information about the new formula is available here.
