The federal government distributes the $14.5 billion program for poor students, known as Title I, to states and school districts based on four separate formulas. Here is how they work:
Basic Formula
This formula allocates Title I dollars to school districts based on the number of poor students they serve. A district qualifies for the funding if it has at least 10 poor children and 2 percent of its students live in poverty. This means that virtually all school districts, even very wealthy school districts, get at least some Title I funding through this formula.
Concentration Formula
This formula allocates Title I dollars to school districts based on the concentration of poor students they serve. A district qualifies for the funding if it has at least 15 percent of children in poverty or 6,500 poor children, whichever is less.
Under both the basic and concentration formulas, once a district hits the required threshold to receive Title I funding, it receives the same amount of money per poor child regardless of how many poor children it serves. That means, for example, that a district with 15 percent of children in poverty gets as much per poor child as a district with 60 percent of children in poverty, even though the poorer district may have fewer overall resources.
This formula allocates more Title I dollars to school districts as their poverty rates increase. A district qualifies for the funding when it has at least 10 poor children and that number of poor children accounts for at least 5 percent of district’s school-age population.
Education Finance Incentive Formula
This formula allocates Title I dollars to states that provide a certain amount of financial support for education compared to their relative wealth (as measured by per-capita income), and takes into account the degree to which education spending among districts within the state is equal. Once a state’s Title I allocation is determined, funds are distributed to school districts in which the number of poor children is at least 10 and accounts for at least 5 percent of the district’s school-age population.
[Source:USNews]
