Reimagining the Teaching Role Through State Finance

School funding debates often grapple with a fundamental tension: Is the priority getting more money into schools, or ensuring that money is well spent? The answer, of course, is that both matter — and that both are affected by state K-12 finance systems. Insufficient funding is obviously problematic, so, too, are state policies that impede school systems from using resources well. Overly rigid state funding structures can stall innovation and impede implementation of promising strategies.

As much as we focus in this newsletter on the benefits of rational, transparent, student-focused funding formulas, state funding policy isn’t by itself the end goal. We do this work so that funding can ultimately enable greater student success.

This brings us to teachers. Teachers and school finance are inextricably linked. The majority of spending in K-12 schools goes toward staff salaries and benefits, and the majority of staff are classroom teachers. So, state leaders, superintendents, and education advocates inevitably ask, “How can states lay a fiscal foundation that enables schools to recruit and retain the teachers students need?” 

Although we can’t answer that question in a newsletter (short answer: it depends, but there are many ways to find out), we’ll instead pull on a new thread in this conversation: How can state education finance help districts create staffing models that improve teaching conditions and reimagine teaching roles? 

Our colleagues recently grappled with that very question and created a strategic staffing implementation framework. Strategic staffing comprises a number of different strategies that schools might implement. For example, a team-teaching approach might enable a school to differentiate teacher roles and allow educators to focus on their strengths, in collaboration with peers. Differentiated compensation policies might better position schools to recruit and retain highly-effective teachers in critical or shortage roles. Distributed leadership strategies might enable teachers to advance in their careers while remaining in the classroom. 

At times, schools that explore new staffing models find themselves hamstrung by prescriptive state requirements that limit staffing flexibility and tie up large amounts of state funding to a fairly prescriptive vision of how a “typical” public school must operate (think: A kind of teacher, per B number of students, in C classrooms, for D minutes per year). There are certainly reasons for this level of oversight and state standards. But schools that want to try something different, within reason, often have to jump through regulatory or funding hoops or may simply give up. 

This kind of innovation is at the heart of the local control that most state leaders espouse. Strategic staffing might be an especially beneficial tool in school systems serving higher proportions of higher-need students. We know schools that fit this profile often employ less experienced teachers and face higher rates of turnover. If these school systems have the ability to reimagine roles, they might better address those challenges. It is also worth considering in environments with a high degree of family choice so that districts can deploy their resources as flexibly as charter and private schools. 

Greater funding flexibility, aligned to student needs instead of staffing assumptions, is one of the reasons we prefer weighted student funding models. By targeting increased funding to greater educational needs, weighted student funding models are designed to direct more resources to school systems serving the highest-need student populations, potentially enabling more creative approaches to boosting students’ access to highly effective educators and avoiding getting into the weeds of staffing decisions best made at the local level.

The formula may not be the innovation, but how states allocate and regulate school funding can be a critical enabling condition for innovation.

—Bonnie O’Keefe and Jennifer O’Neal Schiess

The Big Picture: Trends We’re Watching

On February 3rd, President Trump signed a budget bill that ended a brief partial government shutdown, and funded most federal agencies, including the U.S. Department of Education, for the rest of the fiscal year (the Department of Homeland Security received two weeks of funding while negotiations continue, amid continued effects of immigration enforcement actions on students, educators, and communities). 

Notably for the Department of Education budget:

• The K-12 funding package avoids the steep cuts proposed by the White House and the House of Representatives in summer 2025. Congress’ plan includes largely stable funding for schools serving economically disadvantaged students (Elementary and Secondary Education Act [ESEA] Title I, Part A), and students with disabilities (Individuals with Disabilities Education Act), and preserves programs that the Trump administration proposed eliminating, such as funds for English learners and migrant students (ESEA, Title III). 
• Congress also sought to avert last summer’s multi-billion dollar funding freeze disruption with explicit language directing agencies to release authorized funds on schedule. 
• While Congress has implicitly affirmed with this budget that the Department of Education should exist, the latest budget deal does not stop the Trump administration from delegating core funding responsibilities to other agencies, such as the Department of Labor or the Department of Health and Human Services. (For more, see ongoing activity over the past few months via interagency agreements.) 

Thanks to eagle-eyed federal budget experts we look to for news from Capitol Hill, including Catherine Pozniak and the team at EducationCounsel, and timely coverage from EducationWeek.

State Spotlight: Notable News From Statehouses

It’s State of the State season in legislatures across the country — a time when governors take to the state house and social media to share their reflections from the past year and preview priorities for the months ahead. Although these speeches rarely make for appointment viewing, we always bookmark the National Association of State Budget Officers’ handy tracker and review speech transcripts to help determine governors’ K-12 budget intentions in the year ahead.

Education is a constitutionally mandated responsibility in every state, and K-12 spending is typically among a state’s largest budget categories. With 66% of governors’ mentioning K-12 education funding in their State of the State speeches as of January 26th, here are some emerging trends we’re watching from these speeches:

• Teacher pay and benefits are a bipartisan, perennial favorite policy topic.
  • In Kentucky, Democratic Gov. Andy Beshear noted, “I’m proposing $159 million for mandatory raises for educators … My budget also increases education funding per pupil and adds $560 million to our teachers’ retirements.”
  • Iowa’s Republican Gov. Kim Reynolds said, “We also gave teachers the largest raise in state history, because attracting and keeping great teachers is essential to strong schools.”
  • And in South Carolina, Republican Gov. Henry McMaster touted recent progress, saying, “I proposed that we begin raising the minimum starting teacher salary, as much as possible each year, with the goal of raising it to at least $50,000 by 2026. And each year, we did. We should keep raising it.”
• Funding for private school choice continues to be a hot topic. Several Republican governors committed to expanding or sustaining those investments, while at least one Democrat referenced reining them in. Several states also committed to launching new federally funded tax credit scholarships despite many unanswered questions about rulemaking and implementation.
  • In Arizona, Democratic Gov. Katie Hobbs said she “support[s] public education and bring[ing] accountability to the ESA [education savings account] entitlement program.”
  • Alabama’s Republican Gov. Kay Ivey noted, “I am proposing we increase funding for the CHOOSE Act [education savings account program] to $250 million dollars.”
  • In South Dakota, Republican Gov. Larry Rhoden said, “I was proud to opt-in to the Trump [a]dministration’s school choice opportunity through the One Big Beautiful Bill [Act] … It’s a great opportunity to increase options for students and families.”
• Talk of budget gaps and flatlining revenue are popping up in several states, with some governors committing to stability and a few considering restructuring for new budget realities.
  • Indiana’s Republican Gov. Mike Braun said, “Last year’s budget had some hard decisions, but the first thing we did was fully fund K-12 education. More money is making its way to teachers and classrooms and less to administrative buildings.”
  • In Missouri, Gov. Mike Kehoe noted, “Although funding education is a top priority for me, the current formula simply does not work … we are not cutting core K-12 funding. Only a bureaucrat would say that continued record funding is somehow a cut.”
  • And in Vermont, Republican Gov. Phil Scott cautioned that, “When costs rise and pressure builds, the approach has been to find that quick and easy fix. Throw more money at it, wrap it in duct tape, and hope it all holds. And every time the result is higher costs and higher taxes, while student outcomes fall short and gaps in opportunity widen between regions.”

Follow the Money: What We’re Reading

• A new analysis from our colleagues focused on an often-overlooked funding realm: how state K-12 finance systems can support rural districts. 
• Bellwether’s latest installment of Splitting the Bill focused on how states should implement K-12 funding changes.
• A recent set of revenue trend analyses by Lucy Dadayan and Jonathan Schwabish at the Tax Policy Center.
• The Urban Institute’s recently updated State Economic Monitor.