Are Friends of Schools the Enemies of Equity? The Interplay of School Funding Policies and External Fundraising

71 Pages Posted: 13 Nov 2024

See all articles by Lisa Barrow

Lisa Barrow

Federal Reserve Bank of Cleveland

Sarah Komisarow

Duke University - Stanford School of Public Policy

Lauren Sartain

University of North Carolina (UNC) at Chapel Hill

Date Written: November 12, 2024

Abstract

School districts across the US have adopted funding policies designed to distribute resources more equitably across schools. Concurrently, schools are increasing external fundraising efforts to supplement district budget allocations. We document both funding policies and fundraising efforts in Chicago Public Schools. We find that adoption of a weighted-student funding policy reallocated more dollars to schools with high shares of students eligible for free/reduced-price lunch, creating a policy-induced per-pupil expenditure gap. Further, almost all schools raised external funds over the study period, with most dollars raised concentrated in schools serving relatively affluent populations. We estimate that external fundraising offset the policy-induced per-pupil expenditure gap between schools enrolling the lowest and highest shares of FRL-eligible students by 23-35 percent.

Keywords: education finance, public school, school funding, non-profits, fundraising, equity

JEL Classification: I22, I28, H75

Suggested Citation

Barrow, Lisa and Komisarow, Sarah and Sartain, Lauren, Are Friends of Schools the Enemies of Equity? The Interplay of School Funding Policies and External Fundraising (November 12, 2024). FRB of Cleveland Working Paper No. 24-24, https://doi.org/10.26509/frbc-wp-202424, Available at SSRN: https://ssrn.com/abstract=5019577 or http://dx.doi.org/10.2139/ssrn.5019577

Lisa Barrow (Contact Author)

Federal Reserve Bank of Cleveland ( email )

East 6th & Superior
Cleveland, OH 44101-1387
United States
216-904-8660 (Phone)

Sarah Komisarow

Duke University - Stanford School of Public Policy ( email )

Durham, NC

Lauren Sartain

University of North Carolina (UNC) at Chapel Hill ( email )

102 Ridge Road
Chapel Hill, NC NC 27514
United States

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