money drain

On March 12, 2020, Ohio Governor Mike DeWine announced the nation’s first statewide closure of K-12 schools to “slow the spread” of COVID-19. Within months, nearly every state in the nation closed schools through the remainder of the spring semester.

These final months of the 2019-2020 school year now look less like an unprecedented disruption to K-12 education and more like the modest prologue to a nearly 2-year saga of previously unfathomable institutional failure. While it will take years to fully capture the consequences of government policies implemented during this time, the existing data have already begun to reveal several major themes when it comes to the ill-conceived flood of taxpayer spending ostensibly meant to address the harms of the pandemic, Goldwater’s Matt Beienburg writes in a new report, “The COVID Funding Flood: How Spending Surged in Arizona’s Public School System Amid the Pandemic Era.”

Read Beienburg’s full “COVID Funding Flood” report here.

These themes include the prioritization of the union political machine over student wellbeing, the massive overspending of federal funds, and the costly cycle of fiscal irresponsibility within K-12 that these policies are likely to exacerbate, according to Beienburg, Director of the Van Sittert Center for Constitutional Advocacy and Director of Education Policy.

Looking in particular at the fiscal stimulus and expenditure patterns of public schools leading up to and during the COVID-19 stimulus period, the report uses Arizona schools as a case study on the failure of government policies to align taxpayer resources with the actual needs of public school students. Key findings are as follows:

  • Keeping with nationwide trends, Arizona school districts triggered a massive statewide enrollment decline of nearly 50,000 students as a result of their COVID mitigation protocols—even as charter school enrollment rose and state and federal taxpayer funding for all public schools surged during the pandemic.
  • Arizona school districts spent a significantly smaller proportion of their federal COVID funds (23.6%) than did charter schools (31.3%) during the actual peak of the pandemic (through June 2021), due primarily to the disproportionately high levels of funding that districts have received and accumulated from the federal legislation.
  • The vast majority of districts’ expenditures of federal COVID funds in areas such as technology and school facilities upgrades will have occurred more than a full year or more after many public schools successfully reopened for in-person learning, suggesting these funds will primarily serve a non-COVID-related purpose.
  • In the years leading up to and during the COVID-19 pandemic, Arizona district schools provided a 16.5% average teacher pay raise between fiscal years 2018 and 2021, compared to the 27.9% that state lawmakers provided funding for during this time, which points to districts using additional funds to supplant rather than supplement existing revenue streams.

The COVID-19 pandemic ushered in an era of unprecedented spending on public K-12 schools, yet available evidence suggests that the bonanza of federal spending was almost entirely avoidable and that much of it will likely serve a very different purpose than the one originally sold to policymakers and the public.

To avoid this sort of institutional failure in the future, policymakers in other states should seek to replicate the steps taken by the Arizona legislature to mandate reporting requirements on the use of all federal COVID stimulus funds. But they should also enact substantial systematic reforms, like Goldwater’s universal school choice expansion that is now law in Arizona. Such programs offer to bypass entirely the bureaucracy and middle management of our public education system, putting funds directly into the hands of families to spend on the needs of students—and by extension—to the educators whom families choose to entrust their children.

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