There is considerable evidence that many of the short run gains from educaional intervention programs fade away after two or three years if they are not einforced. Also, this "fade-out" is much greater for the more highly structured rograms, which are most unlike regular public school practice.

It would appear that per-pupil costs of successful educational intervention "ary anywhere from $200 on up, with the "feasible range" for such programs alling between $250 and $350. However, numerous interventions funded at hese levels have failed. Clearly the level of funding is not itself a sufficient ondition for success."

Or recall the recent reports of the American Research Institute review of fitle I. The emphasis in the reports was that, once again, researchers had failed o find that Title I was working. But the Washington Post story began with he very significant quote from the study indicating that the report was not really a review of Title I because "it has never been implemented . . . as intended by Congress." In short, an alternate conclusion from the evidence to date is hat many programs have failed because they have been at the same time poorly managed and underfunded. Again, I would ask, “So what else is new?" Rather than leading us to throw up our hands and to call for the deschooling of society, the recent evidence leads me to suggest that it is time we shift our focus from whether dollars make the difference to the more sensible questions related to what uses of resources can make a difference. And once we do that, a number of answers begin to appear. For dollars buy resources-resources like clinical ratios of teachers or parent-aides per pupil; resources like computerized approaches to individualizing instruction; resources like teacher-centers where teachers themselves may do the plannng, studying, experimentation, and personal development that can make them more effective; resources that can permit schools to take inventory of and utilize other potentially educative institutions like museums or factories; resources to properly fund the kinds of research and development, both basic and applied, that has been so effective in improving agriculture and health in this country.

The schools alone cannot do all the educational work of society. The home, the neighborhood, the example of public figures like yourselves must all play a part. Wringing our hands about the ineffectiveness of schools will not help the children of this nation; but using our heads and our public resources can. I am delighted that this Committee, as evidenced by its convening of these hearings, is seeking to profit from the failings of the past as you seek to design more effective ways to allocate Federal aid to education. For more Federal financing will be needed if the promise of quality education and greater equality of educational opportunity are to be realized in this nation.

FEDERAL AID TO PUBLIC EDUCATIONS WHO BENEFITS? WHO GOVERNS?

8

Our study of Federal aid to education was a two year project which began in the summer of 1969. It has two broad research aspects: one was to chart the flow of Federal aid down to the school district level; the other was to examine the decision-making processes, particularly at the state level but at the local and national level as well, that brought about the fiscal patterns we discovered in the first phase of the research. My emphasis today will be on the patterns of fiscal flows, although I will touch briefly on some of our findings regarding the administration of Federal aid as well.

The study examined the financial patterns of five states in considerable detail. The states were New York, Massachusetts, Michigan, Texas and California, and our sample of districts within those states included 570 local school systems. Four fiscal years were covered: 1965 through 1968. The data output was, of course, massive, but I believe I can summarize the questions we asked and the conclusions we drew rather briefly.

The basic question for investigation was this: what is the impact of Federal aid to education on the finances of elementary and secondary public school systems? More specifically, we sought answers to the following questions:

Harvey A. Averch et al. How Effective Is Schooling (Washington: President's Commission on School Finance, 1971) pp. 124, 5.

7 Washington Post, Apr. 10, p. A3.

See Berke et al. Federal Aid to Education: Who Benefits? Committee Print of the Senate Select Committee on Equal Educational Opportunity, 92d Cong., 1st sess. and Berke and Kirst, The Politics of Federal Aid to Education: Allocation and Decisionmaking (Lexington, Mass. D.C. Heath, 1972 forthcoming).

1. Are there distinctive problems of educational finance in urban areas?' 2. Does Federal aid favor central city, suburban, or rural areas most?

3. Is there a difference among the various Federal programs in the degree to which they aid central city, suburban, and rural areas?

4. Are school districts with low capacities to finance education being aided more or less than richer districts?

5. Are districts with greater and more expensive educational needs receiving more Federal aid than those whose needs are less severe?

6. What has been the trend over the last few years in the distribution of Federal aid?

7. What outstanding administrative problems dilute the impact of Federal programs?

8. And, most important of all, is Federal assistance consistent with the prob lems facing public education?

The answers to all these questions varied from state to state. Indeed one of our clearest conclusions was that the pattern and mix of Federal aid alloca tions varied markedly among states. But some responses to the questions ontlined above can be stated with some degree of generality.

First, in the most urbanized areas of the nation we found a unique crisis in educational finance caused by a general deterioration in their fiscal situation combined with higher demands and costs for education and for other public services than exists in neighboring communities.

Second, we concluded that central cities were receiving more Federal education aid than their suburbs, but that the amounts were far too small to conpensate for the suburban advantage in local wealth and state aid. The districts that received the most Federal aid, absolutely and relatively, were those in nonmetropolitan, largely rural areas. (Table I)

Third, there were significant differences in the patterns of individual pro grams. Title I of ESEA was most responsible for the overall pattern noted above. It homed in our urban and rural poverty in a manner unmatched by any other aspect of the entire local-state-federal fiscal system. (Table II) Yet the patterns of other programs varied immensely and defied the development of con sistent pattern or explanation. In a number of important cases, as in ESEA II and III, Vocational Education, and NDEA III, major cities have received ever less aid than should have been allotted to them in view of just their proportion of the state's pupil population. (Table III) When questions of comparative cost or student need are taken into account, the pattern becomes far more discrimina tory.

Fourth, if fiscal capacity to support education is seen only in terms of propert value per pupil, there is little compensating effect through Federal aid. Bu if capacity is seen in terms of income levels, then the pattern described abov does show a compensating or equalizing pattern, again due largely to Title I (Table IV)

Fifth, if one takes the proportion of poor and minority pupils in a distric as one proxy for educational need-and my colleagues and I do-Federal ai tends to be significantly related to educational need. Districts with lower in come and higher proportions of non-white pupils received more aid than thos with lower proportions of such pupils. Title I showed this phenomenon mor than the other programs, and by and large even the other Federal aid program in which the state has discretion as to their distribution seemed to be mor responsive to educational need than was state aid. However, the magnitudes aid were meager in proportion to the immensely costly task of education for th poor and culturally deprived. (Table V)

Sixth, over the four-year period of our study, amounts of aid received by in dividual school districts varied markedly and erratically. Furthermore, durin the last year studied, almost half of the districts in metropolitan areas reporte an actual decrease in per pupil amounts of aid.

Seventh, although questions of program administration and design are a par of a later phase of this study, we did think it useful to comment on some ou standing problems at this point. ESEA money, for example, has largely gor

? A note on terminology: The terms "urban" and "urbanized" are used to refer to citi and older more densely populated suburbs that have many characteristics in common wi central cities. The term "metropolitan" refers to a Standard Metropolitan Statistical A (SMSA) as defined by the Census Bureau. We use the term "central city" (CC) to der the core city of SMSA. "Outside central city" (OCC), "outlying areas." and "suburbs refer to the remainder of the SMSA. We designate all areas outside SMSA as "n metropolitan" or "rural".

*

for a variety of special and ancillary programs and has not been utilized to improve the central portion of the curriculum presented to disadvantaged children. The failure to concentrate funds on the students most in need of compensatory education has frequently resulted in a superficial veneer of fragmented programs or new equipment, rather than in an integrated, high impact intervention to achieve major educational change. Dilution of the impact of federal aid has also come about through the improper but widespread use of Title I as general aid for system-wide purposes.

Eighth, and last, Federal aid is intended to provide strategically useful funds for educational purposes not otherwise receiving adequate support. Our study suggests, however, that the amounts of aid are simply too small in view of the problems that confront public education. At present, for the nation as a whole, federal aid constitutes less than 7 percent of public elementary and secondary school revenues. For the five industrialized states of our study (California, New York, Michigan, Massachusetts, and Texas), the proportions ranged from little over 3 percent in New York to 10 percent in Texas. In per pupil absolute terms, the amounts of Federal aid usually averaged between $40 and $70 per pupil. Given our findings on the threatening fiscal crisis facing urban education, these amounts are patently insufficient to overcome the financial problems of the urban public schools.

Besides our analysis of fiscal flows, our study also examined the decision-making process in the states related to Federal aid. Before the field research got underway, we formulated six major research assertions to be tested in New York, Massachusetts, Michigan, Texas, California, and Virginia, the six states of the second phase of our study. The assertions are listed below:

(1) There will be less involvement and political influence by the governor and legislature on Federal aid in comparison with state aid. General government executives will leave allocation decisions and negotiations to state education professionals.

(2) The influence and impact of the urban school lobby on the state allocation of Federal aid will not be significant. Cities will not form state coalitions or use existing coalitions to direct more federal aid to their needs.

(3) As Federal aid increases and states have more discretion in allocation, pressures will increase on state government from organized interests. Consequently, a longitudinal analysis would show a gradual change in interest group intensity.

(4) The state education agency will attempt to minimize political conflict and pressure by using existing state aid formulas for allocating Federal funds. Most of these state aid formulas are not adjusted very well for core city needs.

(5) Federal aid, except in a manner restricted by Federal guidelines or requirements, will flow within a State as it has in the past. Once the pattern of state distribution is established based on assertion #4, then the flow will only be altered by explicit and vigorously enforced federal regulations.

(6) SEA personnel are socialized so that they view their proper role as providing technical assistance to the LEA's, not enforcing or policing Federal requirements or setting program priorities. This rather passive, technical assistance role vis a vis the LEA's would preclude such things as setting reading priorities or restricting Title I aid to elementary schools.

While our assertions proved to be relatively accurate descriptions of the central tendencies found in our six studies there are striking exceptions. In California, for instance, the legislature has extensively earmarked the Federal aid allocations. In Michigan, the SEA has employed a needs assessment and targeted funds to urban areas to counter the state aid flow-thus contradicting our fourth assertion. The service and technical assistance role attributed to SEA personnel in our sixth assertion is not valid in certain titles (particularly Title III of ESEA). Coalitions of urban districts have not concentrated their efforts on federal aid as yet, but Detroit and New York have hardly been as unaware or passive with repect to state allocation of Federal aid as our second assertion would suggest. Large scale changes in the flow of federal dollars in Michigan and California were not related to changes in Federal regulations or enforcement policies clearly exceptions to our fifth hypothesis.10

Each of the six case studies specifically analyzed the factors, weights, and formulas for state allocation of Federal funds on a title-by-title basis. Many of the titles across the states show a strong similarity to state aid formulas,

10 See Ch. 4 by Kirst in ibid.

primarily with respect to uniform per pupil allocations and the merger with formulas on teacher units or teacher salaries. The equalization parts of state aid usually employ an adjustment for assessed property valuation, and this was not included in Federal aid allocation formulas devised by states.

CONCLUSION

American educational finance is shot through with irrationality, inequity, and the consistent denial of equality of educational opportunity. But for the first time in decades, reform is in the air. Unfortunately reform will be costly because it will require bringing low spending school districts closer to expenditures of the more wealthy and will require additional expenditures to recognize higher costs and higher levels of educational need. Increasingly, educators, politicians and parents will be turning to the Federal government to bear those costs.

And yet there is a heavy strain of skepticism abroad, a substantial doubt that additional dollars will really make any difference at all in the quality of American education. But the evidence to date is inconclusive, with no definitive proof, one way or the other, that added resources bring about increased learning. What has been shown is that marginal funds seldom are effective and that many programs have been mismanaged, conditions which are remediable.

What has the experience with Federal aid to date shown? Studies conducted by the Syracuse University Research Corporation have examined both the fiscal impact and the decision-making patterns related to Federal aid in a sample of populous and industrialized states in all sections of the nation. The major conclusions are that Federal aid, while it has been directed to areas of greatest need such as large central cities, poor rural areas, and districts with large numbers of the poor and the non-white, has been too small an amount to significantly effect the total problems of educational finance that afflict most of the states of the nation. While Title I of ESEA is the most effective equalizing force in the mix of local, state, and Federal funding, its effect is significantly diluted by other programs which often help richer districts more than they do poorer ones.

Administratively, states have tended to deal with the distribution of Federal aid as an internal matter for the education bureaucracy. Most governors, legis lators, and urban lobbies are only dimly aware of the potential for altering Federal aid flows. Frequently existing state aid formulas will be relied upon for the allocation of Federal monies in an attempt to minimize conflict and utilize familiar procedures. State department personnel seldom exercise vigorous leadership or seek to implement any but clear Congressional mandates and those regulations most stringently stressed by the Federal officials. Yet to each of these generalizations we have found a few agencies within states that have been shining exceptions, who have sought to utilize Federal aid for achieving greater equality of educational opportunity by matching Federal resources to areas of greatest need, particularly those of the educationally disadvantaged and the communities most threatened by fiscal crisis.

TABLE 1.-FEDERAL AID AND TOTAL REVENUE, BY CENTRAL CITY, OUTSIDE CENTRAL CITY, AND NONMETROPOLITAN AREAS, 1967

TABLE II.-COMPARISON OF FEDERAL AID PROGRAMS AND STATE AID FOR SCHOOL DISTRICTS IN METROPOLITAN

Source: Policy Institute of the Syracuse University Research Corp., project: "The Pattern of Allocation of Federal Aid to Education," supported by Ford Foundation Grant 690-0506A, Joel S. Berke, project director.

TABLE 111.-REVENUE FROM FEDERAL SOURCES, BY PROGRAM, COMPARING STATEWIDE, CENTRAL CITY, OUTSIDE CENTRAL CITY (SUBURBAN), AND NONMETROPOLITAN AVERAGES