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Center for American Progress

Many state and education leaders continue to support and employ methods that prevent schools and principals from undertaking the efforts that they think are most needed to improve education in their classrooms. The use of state categorical grants--funds to school districts with strict limits on their use--exemplifies this lack of innovation in school finance. Categorical grants remain all too common in state education finance systems. New survey data released today in a Center for American Progress issue brief by Joanna Smith and researchers at the Rossier School of Education's Center on Educational Governance at the University of Southern California, provide a national overview of which states have embraced more flexible funding streams and which are still using rigid bureaucratic categorical grants to fund schools. The data also show the extent to which categorical grants comprise state education budgets and reports on state finance and district officials' opinions of categorical grants. Key findings from the study include: (1) Categorical grants are prominent in state education finance systems; (2) A variety of policymakers are empowered to create or terminate categorical grants; (3) States most commonly used categorical grants for special education; (4) State education officials generally have a positive view of categorical grants; and (5) District superintendents and school board members are favorably disposed to categorical spending, though they expressed the desire for greater flexibility. [This brief is part of a larger multiyear project on governance, conducted in partnership with the Thomas B. Fordham Institute.]

Descriptors: Funding Formulas, Educational Improvement, Educational Finance, Educational Practices, Program Termination, Special Education, State Officials, Administrator Attitudes, Superintendents, State Policy, State Action, State Surveys, Educational Administration

Center for American Progress. 1333 H Street NW 10th Floor, Washington, DC 20005. Tel: 202-682-1611; Web site:

Autor: Lazarín, Melissa


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