The federal government provides funding for education, too.[*] Its payments are not made on a per-pupil basis, but instead favor districts that enroll students from poor families. If counting only local and state K-12 dollars in the allocation, the Urban Institute ranks Michigan among the more “regressive” states for providing less funding for districts with high-poverty student populations compared to other states. Adding federal funds into the mix moves Michigan into the top 10 for most “progressive” states.[23]
Apart from special education and school nutrition subsidies, the largest share of K-12 federal funds underwrites programs for low-income and at-risk students through Title I.[†] These dollars are stacked on top of all state and local funding a district receives. Thus, school systems with larger populations of low-income students tend to receive more total revenue per student because they receive more federal dollars per student.
But the complex nature of the Title I at-risk formula in particular yields frequent disparities and, in a few cases, some widely divergent results. For example, the Flint and Muskegon school districts have nearly identical enrollment levels and operate in communities with similar poverty rates. Yet in 2020-21, Flint received $12.7 million in Title I funds, compared to Muskegon’s $3.5 million. Flint particularly benefits from a provision in the federal Title I formula that ensures high-poverty districts must receive at least 95% of the previous year’s allocation.[24] Because the district was once much larger, this hold-harmless provision keeps Flint’s Title I funding elevated on a per-pupil basis.[25]
Such disparities were magnified greatly in the distribution of federal COVID-19 relief funds, an additional, albeit short-term, source of revenue. Michigan districts received nearly $5.2 billion combined from three separate allocations of the Elementary and Secondary School Emergency Relief Fund, each round of which relied on the same Title I formula.[26] Additional federal COVID relief allocations pushed the total over $6.1 billion, or $4,200 per student enrolled in fall 2020. Muskegon is set to collect the significant amount of $40.6 million, or about $11,750 per student. Meanwhile, Flint will take in the immense sum of $156 million, or nearly $50,000 per pupil.[v]
[*] Most K-12 federal revenues are appropriated through the state budget process: $1.75 billion out of $1.955 billion in fiscal year 2019-20, as reported in National Public Education Financial Survey data and "Line Item and Boilerplate Summary: School Aid, Fiscal Year 2019-20, Public Act 58 of 2019, House Bill 4242 as Enacted, Including Vetoes and Supplemental Appropriations through December 31, 2019" (Michigan House Fiscal Agency, Jan. 2020), https://perma.cc/WR3P-XPFT.
[†] The three largest federal appropriations are: Section 31d - School Lunch Program for low-income children ($537.2 million); Section 39a(1) - Title I funding for disadvantaged children ($535 million); and Section 51a – Special Education ($431 million). Together, they make up about 86% of the $1.746 billion federal appropriation in Michigan’s school aid budget. "Line Item and Boilerplate Summary: School Aid, Fiscal Year 2019-20, Public Act 58 of 2019, House Bill 4242 as Enacted, Including Vetoes and Supplemental Appropriations through December 31, 2019" (Michigan House Fiscal Agency, Jan. 2020), https://perma. cc/WR3P-XPFT.