In the third annual update to our analysis of the U.S. Census Bureau’s Annual Survey of School System Finances, fiscal year (FY) 2024 data provide a more comprehensive longitudinal view of how K-12 funding and enrollment have evolved across states through and beyond the pandemic. That fuller picture shows a nationwide school funding landscape that looks markedly different from the last few years.
After two years in which one-time federal COVID-19 relief drove nearly all funding growth in most states, state governments stepped in to fill the gap in FY24, the last year in which districts could newly obligate one-time federal Elementary and Secondary School Emergency Relief (ESSER) funds. A few patterns define the FY23-to-FY24 change in the data:
- Total and state per-pupil funding rose in 39 states, while federal per-pupil funding fell in 36 states.
- After two years of more moderate enrollment declines, student enrollment declined in 42 states.
The sections that follow underscore how some states are shouldering a larger share of the cost as enrollment declines and ESSER funds expire. This shift will be hardest on states that spent one-time federal dollars on ongoing costs rather than building recurring revenue to replace them.
EXPLORE THE NEW DATA
See updated, inflation-adjusted data and learn more about your community’s local, state, and federal education funding and student enrollment from FY08 to FY24 in “Fortifying Funding: An Interactive Bellwether Education Finance Tool.” (Note: This extends our analyses through FY24, with all funding figures presented in inflation-adjusted, or real, U.S. dollars unless otherwise noted. The District of Columbia is excluded from all state counts throughout, as this analysis focuses on state funding.)
Total per-pupil funding increased in more states in FY23 than in the previous two fiscal years
Between FY22 and FY23, only 23 states saw an increase in total per-pupil funding (local, state, and federal combined), down sharply from the 48 states that saw increases between FY20 and FY21, when ESSER COVID-19 relief funding was at its peak in nearly every state’s budget. That trend reversed between FY23 and FY24, with 39 states seeing total per-pupil funding increase. Nationally, inflation-adjusted total per-pupil funding climbed to $21,389, the highest level in the analysis, and roughly $2,000 more per student than in FY20. However, this was not universal: 11 states saw total per-pupil funding decline even as most of the country saw gains (Figure 1).
Figure 1: Change in Total Per-Pupil Funding From FY23 to FY24
Source: U.S. Census Bureau’s Annual Survey of School System Finances for FY23 and FY24.
Federal per-pupil funding declined in most states as one-time COVID-19 relief funding wound down
Federal per-pupil funding fell in 36 states between FY23 and FY24, marking the second straight year of broad decline. Federal per-pupil funding rose in nearly every state in FY21 (49 states) and FY22 (47 states) on the strength of one-time federal ESSER funds, but that trend reversed in FY23, with declines in 38 states. Nationally, inflation-adjusted federal per-pupil funding dropped from $2,667 to $2,479, a 7% decline (Figure 2).
This decline reflects districts obligating their remaining ESSER dollars ahead of the Sept. 30, 2024, federal deadline. By August 2024, states and districts nationwide had already spent about $170 billion (roughly 90%) of the $190 billion in combined ESSER funds. Districts had until March 2026 to liquidate whatever remained.
Figure 2: Change in Federal Per-Pupil Funding From FY23 to FY24
Source: U.S. Census Bureau’s Annual Survey of School System Finances for FY23 and FY24.
State funding rose in far more states, reaching a new high
The clearest reversal in the FY24 data is in state funding. Only nine states increased per-pupil state funding between FY21 and FY22. From FY23 to FY24, 39 states did so, matching the rebound in total funding, but it’s not the same 39 states. Thirty-five states saw both total and state per-pupil funding rise. Colorado, Florida, Illinois, and Oregon saw total funding grow despite a decline in state funding, while Connecticut, Iowa, Nebraska, and Washington saw state funding rise even as total funding fell.
Nationally, inflation-adjusted per-pupil state funding climbed to $9,716, its highest point in our analysis to date. State dollars are increasingly replacing some of the federal relief funding in districts across the country. Specifically, Nevada, New Mexico, Vermont, Minnesota, and Idaho posted the largest per-pupil dollar increases in state funding in the country. Eleven states, however, experienced a per-pupil decrease in state funding (Figure 3).
Figure 3: Change in State Per-Pupil Funding From FY23 to FY24
Source: U.S. Census Bureau’s Annual Survey of School System Finances for FY23 and FY24.
Enrollment declines returned in most states, and most states remain below pre-pandemic levels
Enrollment losses had moderated for two years, with 20 states seeing declines between FY21 and FY22 and 20 again between FY22 and FY23. That pause ended in FY24. Forty-two states saw enrollment fall between FY23 and FY24, and only eight states — Alaska, Delaware, Maryland, Montana, New Jersey, North Dakota, South Carolina, and Washington — gained students over that same period.
Looking across the full pandemic period, 45 of the 50 states still have lower enrollment in FY24 than they did in FY20, underscoring that the enrollment declines that began in FY21 have largely persisted rather than reversed. Falling birth rates are the primary driver: the national birth rate declined by 15% between 2012 and 2024, and every state saw a decline of at least 6% over that period (Figure 4).
Figure 4: Change in Student Enrollment From FY23 to FY24
Source: U.S. Census Bureau’s Annual Survey of School System Finances for FY23 and FY24.
Next steps for state K-12 education funding
The FY24 data capture a system in transition. Federal ESSER relief funding was still being spent down, increased state funding helped offset the decline in federal funding, and enrollment continued to fall in most states. FY24 was the last fiscal year in which districts could obligate ESSER funds and were allowed to liquidate through March 2026.
Because that liquidation window ran into FY26, some ESSER-funded spending may still show up in FY25 and FY26 budgets, meaning FY27 will be the first fiscal year with no ESSER dollars in the data. The states and districts most adversely affected by the loss of those federal dollars are those that used the one-time funding for ongoing costs rather than building recurring state revenue to replace it. Those shortfalls will surface first in FY25 budgets, even as the last ESSER dollars trickle out through the remainder of FY26.
Enrollment pressure is also not expected to let up. The National Center for Education Statistics projects that public K-12 enrollment will continue to fall across most of the country, and that 40 of the 50 states will have lower enrollment in fall 2031 than in fall 2022. With continued enrollment declines, tighter state budgets, and proposed federal cuts to programs serving English learner students and other marginalized student groups, state policymakers and leaders will play a crucial role in ensuring funding stability and equitable resources for all K-12 students in the years ahead.
