Report Promoting a ‘Money Follows the Child’ Funding System Lacks Rigorous Analysis


BOULDER, CO (May 3, 2022)—In recent years, supporters of school choice have promoted school finance reforms sometimes called “backpack funding,” but also called “money follows the child” or “student-based budgeting.” Whatever the term used, the idea is facilitate choice by attaching a funded amount to each student, with that payment following the students to their chosen schools.

A recent version of this proposal is found in a new report from the Mackinac Center, which provides a six-part recommendation for changes to Michigan’s current approach to financing public and charter schools. The report’s overarching theme, which is examined in a new review, is to move toward a system where more funding follows the student to either public, charter, or private schools—or to other service providers.

Bruce Baker of Rutgers University reviewed From School Aid to Student Aid: Modernizing K-12 Funding in Michigan, and found it to provide some useful, albeit insufficiently researched, guidance on shifting categorical funding into core funding and modifying the state’s approach to financing programs for children with disabilities.

Yet Professor Baker also describes how the report mischaracterizes literature on whether school finance reforms matter for school quality, and on the benefits of school district consolidation. The report also fails to recognize the various factors that affect the costs of providing children equal educational opportunity. Further, it largely ignores the realities and constraints of how schools and school systems work and how annual budget planning and resource allocation work toward efficiently providing high-quality educational services to children, regardless of sector or location.

Accordingly, Professor Baker concludes, key elements of the report and its proposals are built on false promises and assumptions and are not helpful for policymakers.

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