Bridging the Gap: Assessing the Effectiveness of Fair Student Funding in New York City Public Schools

Abstract

UNICEF defines a quality education as one that will provide literacy and critical thinking skills to prepare children to be contributing members of society. UNICEF has also declared a quality education to be the right of all people. In Campaign for Fiscal Equity Inc. v. State of New York (2007), the New York State Court of Appeals ruled that schools and governments in the state were not adhering to these goals, and ordered that they ensure that enough funds were allocated to provide quality education for all of their students. In response to the court’s ruling, New York City instituted Fair Student Funding (FSF) in an attempt to correct the funding disparity between richer and poorer areas. This 2007 policy gave more money to schools with more students who need extra assistance, such as at-risk students, poor students, disabled students, and students for whom English is not their native language, among others. To quantify the effect of Fair Student Funding on educational outcomes, this study compares New York City public schools to other New York State public schools from 2001 to 2015 using a difference in difference research design with year and school fixed effects, and school-specific linear time trends. This study measures outcomes such as test scores, graduation rates, attendance and suspension rates, and future aspirations. The data show that some subgroups do experience large positive changes in some outcome variables, such as test scores for disabled students. However, the overall results do not seem to provide any conclusive evidence that FSF has worked as intended. These panel data results are robust to several changes in research design, including propensity score matching and DiNardo, Fortin, and Lemieux (DFL) reweighting. These results suggest that more time may be needed in order to see the full effects of FSF, but as of this moment, the effects of funding changes are relatively small.