Adopted in 2010, Rhode Island’s funding formula for education — the primary mechanism for delivering state education aid to local communities—was moderately successful in increasing the state’s share of overall education revenues and in delivering increased aid to poorer districts. But it did not do enough to advance equity. After ten years, some of Rhode Island’s poorest districts — both in terms of relative property wealth and students from low-income families — were still among those with the lowest per pupil expenditures in the state. According to one national study, Rhode Island had a greater funding gap between its higher- and lower-poverty districts than all but two states.

While well-intentioned, the General Assembly’s recent decisions to hold districts harmless from enrollment declines, along with other changes, have made education funding even less equitable. Case in point: some of our wealthiest districts received the largest percentage increases in per pupil state funding from FY 2022 through FY 2024.   

The governor’s FY 2025 budget offers some laudable proposed investments in K-12 education. The proposal would almost double categorical spending for multilingual learners, a student population which has grown by nearly 70% since 2015. The proposed investment of $15 million for math and reading coaches also would give a needed boost for schools still struggling to reclaim learning lost during the pandemic.

However, the governor’s budget also proposes yet another major change to the funding formula. Under current law, the core instructional amount—the dollar figure considered to be the minimum amount to educate a child based on an average of educational costs in Rhode Island, Connecticut, Massachusetts, and New Hampshire—was set to increase by 6.2% in FY 2025. The governor’s proposal would instead cap the increase at 3.9%, based on average inflation over the past five years. Since the funding formula provides bonuses based on the core instructional amount for students in poverty and multilingual learners, the proposed change would have significant downstream effects. This is especially true in our urban core districts (Central Falls, Pawtucket, Providence, West Warwick, and Woonsocket), which rely most heavily on state funding, have among the highest concentrations of students in poverty and multilingual learners, and also have the least capacity to generate property tax revenues to make up for shortfalls in state funding.

In its first ten years, the funding formula drove nearly 60% of total increases in state district aid to urban core districts. Since the pandemic, these districts have received less than half of the increased aid. If the governor’s proposal is adopted, urban core districts would receive only $2.6 million (18.5%) of the $14.3 million in increased total aid to school districts (which includes the increased spending on multilingual learners). While this low share of new funding results in part from greater enrollment losses in the urban core districts, even accounting for enrollment, Pawtucket, West Warwick, and Woonsocket would receive percentage increases in state aid at or lower than the average percentage increase for more affluent districts.

This persistent disparity in funding between urban core and more affluent districts is compounded by the greater educational challenges and costs associated with educating disadvantaged students and multilingual learners. Studies have suggested that economically disadvantaged students require as much as three times the funding to achieve comparable proficiency as students in more affluent communities. Similar funding needs apply to multilingual learners, who make up a growing number of students in our urban core.

Urban core districts, long underfunded by the state and by their local communities, have been largely shielded recently from the negative effects of formula changes thanks to the massive infusion of pandemic-era federal Elementary and Secondary School Emergency Relief (ESSER) funds. However, with this funding expiring, these districts now find themselves in the critical situation of needing to quickly right-size their operations through layoffs, eliminating classrooms, and even closing schools.

It is time to admit that our funding formula for education is broken and needs comprehensive reform. These reforms first and foremost should target more aid to our urban core districts, which have disproportionate numbers of students with the greatest educational needs.

Michael DiBiase is the president and CEO of the Rhode Island Public Expenditure Council, a nonpartisan, nonprofit public policy research organization. This is the second of a four-part series on Governor Dan McKee’s proposed fiscal 2025 state budget.