Racial Disparities in NY State Aid Shortfalls

Posted on December 13, 2013



Yesterday, Ed Law Prof Blog posted an update about the Office of Civil Rights complaint to be filed by Schenectady School District claiming that shortfalls in New York State aid fall disparately by student race.

I’ve reported on numerous occasions on this blog the patterns of disparity in New York State funding. I actually hadn’t checked recently the strength of the relationship between funding shortfalls and school district racial composition. As the Ed Law blog explains, litigation around this question (that of racially disparate impact of school funding policy) was largely headed off by the Sandoval case which held that no private right of action exists for challenging policies violating disparate impact regulations promulgated under Title VI of the Civil Rights Act. “Disparate impact” occurs where a policy ends up having different effects on one group versus another, by race, ethnicity or national origin but not necessarily because the policy is written explicitly to treat individuals differently by race. That is, it’s a statistical association with race that may not have to do directly with race. But then again, it might. That’s the hard part to prove when race isn’t written right into the policy as it used to be, say, in the pre-Brown era. For those interested in some additional school finance reading on this topic see:

  • Baker, B. D., & Green III, P. C. (2005). Tricks of the Trade: State Legislative Actions in School Finance Policy That Perpetuate Racial Disparities in the Post‐Brown Era. American Journal of Education, 111(3), 372-413. AJE_Baker_Green_Tricks

In the post-Sandoval era, complaints regarding policies that yield racially disparate impact are to be brought as administrative claims, through the relevant federal agencies/departments, just as Schenectady has done here (as elaborated in Ed Law Prof Blog).

So today’s big question is just how bad are the racial disparities in state aid shortfalls in New York State?

Is Schenectady right?

First, let’s define state aid shortfall. As I’ve explained on previous posts, New York operates a foundation aid formula which defines the per pupil amount of funding that is required for each district, given it’s location (labor market) and students (needs) in order to achieve adequate outcomes (this formula being the state’s own proposed remedy to previous state litigation over the adequacy of funding). So, in step one, the state calculates adequate target funding:

1) Sound Basic Funding Target = base funding figure x pupil need index x regional cost index x aidable pupil count

Where that “aidable pupil count” figure includes some additional adjustments.

Step two determines the amount the local district should contribute to the sound basic target funding and thus, the remaining amount to be contributed as state aid.

2) State Aid = Sound Basic Funding Target – Local Contribution

But the problem is that New York has, in nearly every year since proposing this remedy to past litigation, added a few more steps to the calculation, which include:

  1. freezing foundation funding to levels from several years prior
  2. invoking the deceptively named “Gap Elimination Adjustment” to inflict disproportionate cuts on needier districts 
  3. enforcing local property tax limits that effectively prohibit districts from making up their losses in state aid – and effectively prohibit districts from even coming close to achieving the level of funding the state itself has declared as constitutionally adequate. Notably, the aid shortfalls are so extreme that low wealth districts really couldn’t ever tax themselves locally enough to make up the losses even if they tried.

Point #3 above is the subject of a separate lawsuit challenging the absurdity of invoking a policy that would prohibit, even if possible, districts from raising the level of funding the state itself declares as adequate but refuses to provide.

So, after the additional freezes and cuts are invoked, we can determine the state aid gap as follows:

State Aid Shortfall = State Aid to Achieve Sound Basic Funding Target – Actual State Aid after Freeze and Gap Elimination Adjustment

And just how related to race are those aid shortfalls? Well, here it is, based on the 2013-14 State Aid Runs merged with demographic data from the 2012 NYSED School Report Cards:

Race & NY State Funding

Previously, I’ve shown that these aid shortfalls are pretty strongly associated with the state’s own Pupil Need Index with higher need districts facing larger shortfalls. And racial composition is associated with the pupil need index, if we focus on traditionally disadvantaged racial aggregate classifications (which is a whole separate can of worms).

To summarize the graph above, which visually displays only those districts with greater than 2,000 pupils, but includes all (weighted for enrollment) in statistical estimates, it is certainly the case that New York State districts with higher concentrations of black or Hispanic children have greater state aid shortfalls.

There is indeed a racially disparate impact.

Moreover, that impact is pretty darn big. Moving from a district with 0% black or Hispanic children to one with 100% black or Hispanic children yields a difference in funding gap of over $2,000 per pupil.

Many of the state’s highest minority concentration districts have state aid shortfalls between $5,000 and $10,000 per pupil whereas NONE of the lowest minority concentration districts has an aid shortfall over $5,000 per pupil!

And these state aid shortfalls are shortfalls against the State’s own (paltry, low-ball) estimates of what it might have taken to achieve the now dated outcome standards of 2007 (under previous litigation)!

UPDATE:

Here’s a quick multivariate run of the data to determine whether otherwise similar districts with more minority children have bigger funding gaps, where otherwise similar is determined with respect to components of the formula itself – the Regional Cost Index, Pupil Need Index and the additional weights included in the Total Aidable Foundation Pupil Unit count.

funding disparate impactSomewhat surprisingly, in this regression, the racially disparate impact is actually larger than when previously represented only as a bivariate relationship between funding gaps and race. I’d have expected the Pupil Needs Index to have substantially moderated the relationship between race and funding gap. But, it is also likely that within any region, the funding gaps are more disparate by race than they appear statewide. This occurs because many of the high minority districts are in higher cost regions.

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