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Addressing Funding Inequity in American Schools

Updated: Mar 25

Big Picture

Funding American public schools is more complex than it might seem on the surface. It differs from state to state, city to city and district to district. Dollars are not always distributed equally.

At the core of American democracy lies the principle that every child deserves a comprehensive education, regardless of whether they’re from Compton or Beverly Hills. Many schools in America are underfunded at the expense of disadvantaged students, while others receive disproportionately large sums of money to the benefit of students in affluent neighborhoods. The issue of lopsided funding directly contributes to educational inequities in America. Many private and public forces create discrepancies and solutions with disparate impacts.

Many states rely on local property taxes to fund their public schools. Because of this, neighborhoods and municipalities with higher property values receive more funding for their public schools. Most of these areas are well-off to begin with, needing funds less than schools in impoverished neighborhoods. Better schools, in turn, raise property values and further inflame quality divides.

In addition, PTA organizations, mainly found in wealthier school districts, play a large role in raising outside funds and deciding how funds will be allocated. Parents from these organizations often work together to organize elaborate fundraisers or donate large sums of money to their children’s already high-performing schools, thus widening existing funding gaps and putting poorer students in their respective districts at an even greater disadvantage. The result of all this is a compounding effect where already well-funded schools are also the most likely to receive charitable donations from wealthy parents, who do so to benefit their children but also to receive tax write-offs.

Operative Definitions 

  1. Parent-Teacher Association (PTA): A volunteer organization comprised of parents, teachers and community members who fundraise, engage in advocacy efforts and foster wider community engagement with the goal of bettering the school or influencing its policies. 

  2. Market-based: An approach or system that relies on the principles of supply and demand, competition and private enterprise to shape and govern economic activities and resource allocation. In contrast to a centralized approach, in which the government delegates a solution through organized bureaucracy. 

  3. Educational Service Provider: An entity or organization that offers educational programs, resources, or services to students, schools, or educational institutions. A public school is but one variation of an educational service provider. Companies that create home-school curricula constitute another. 

Important Facts and Statistics 

  1. Most school districts source their funds through property taxes, giving wealthy municipalities more funding for their schools through higher property values.

  2. In the Malibu Santa Monica unified school district, the district ruling to seize control of funds from PTA accounts led to the collective decision of affluent parents to secede from the school district, creating a more socioeconomically homogeneous district where they had more control over the funds that they raised or donated. 

Two-Point Plan 

(1) Create state-funded PTA assistance programs for disadvantaged districts.

The creation of state-funded PTA assistance programs could go a long way in narrowing the funding gap between school districts. These programs should enlist successful PTA organizations from affluent municipalities and associated districts, or a select number of members from said organizations, to serve as envoys and strategists to develop competent and successful PTA organizations for poorer districts. The primary purpose of the program is the transfer of specialized skills and know-how related to fundraising and crowdsourcing activities. States should ensure the success of these programs by providing ample incentives for assembled envoy groups.

(2) Create an educational assistance program for the disadvantaged.

This proposal would see the implementation of a program for families that meet certain criteria. States will reallocate a portion of their education budget in order to fund the program. Families who meet the selected criteria will receive a grant, which they can use to supplement their child’s education as they see fit. Uses for grants might include tutors, supplementation for private school tuition costs, homeschooling materials, supplemental online courses, etc. This program adopts a decentralized, market-based approach to the issue, empowering individual family units, rather than the government, to address specific, individualized problems. It also promotes competition between educational service providers to help ensure high standards and foster continual innovation within the education sector.

Why This Initiative is Important

The primary purpose of education in the U.S. is to act as a vehicle for social mobility, to provide young Americans with the opportunity and resources and to understand how to advance beyond the background they came from. Reexamining how we fund our public schools can help contribute to a more well-rounded America where everyone has similar opportunities, regardless of where they come from.

The opinions expressed in this article are those of the individual author.


Preston, Teresa. “Fair Financing of Public Schools, as Seen by Kappan Authors.” The Phi Delta Kappan, vol. 100, no. 8, 2019, pp. 5–7. JSTOR, Accessed 12 Oct. 2023. 

Murray, Brittany C. “PTAs, Parent Involvement, and the Challenges of Relying on Private Money to Subsidize Public Education.” The Phi Delta Kappan, vol. 100, no. 8, 2019, pp. 42–46. JSTOR, Accessed 12 Oct. 2023.

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