Rural Poverty, Funding for Education, and Public Policy

Policy Studies Journal. Vot 75, Wo 2 December, 1986

RURAL POVERTY. FUNDING FOR EDUCATION,AND PUBLIC POLICY

David L Debertin. Rodney L Ciouser and John M Huie

Linkages between funding for educational inputs purchasedby public school systems and the sociai and economic charac-teristics of residents has been a topic of continuing concern ofsociologists and education speciaiists for more than two decades(Kiesling, 1967, Zimmer. 1967) These studies have usuaiiysuggested that the funding availabie for publtc school districts inrural, suburban, and urban areas is cfosely linked to the incomesof the residents High-income communities tend to be wiiiing topay for the support of iocal schools, while those in iow-incomeareas tend to be iess willing (Zimmer, 1967) Thts paper expioresthe iinkages between rural poverty and funding for pubiiceducation in rurai areas

Past research has shown that the reiationships betweeneducational funding and pupil achievement, if they exist at ali,are very compiicated (Coteman, 1966, Bowies, 1968. Moynihan,1968, Greenbaum, I97i) However, students coming from schooisin low-income rural areas are at a competitive disadvantage ifteachers are pooriy trained pupil,/teacher ratios are inordinateiylarge, or the curricuium at the secondary ievei has insufficientbreadth to fuily meet the needs of individuai students

Thts paper draws from the authors" previousiy pubiishedwork in indiana linking the socioeconomic charactenstics of iocaicommunities to the kind of public education students receive fromthe school It focuses on the question of whether or not childrenfrom low-income rural areas receive an education infenor to thatobtained by their counterparts in high-income suburban schooisAn anaiysis is conducted of what makes a schooi system in aiow-income rural area different from that found in a high-incomesuburban or urban distnct

Factors infiuencing differences in the characteristics ofpublic school teachers among school districts in tow- and high-income rural and urban distncts are analyzed Linkages betweenexpenditure levels, pupil/teacher ratios and income levels areexplored The effect of famiiy income and other variables onschooi dropout rates is examined The wiiiingness of localresidents to tax themselves for the support of pubiic schools, inhigh versus low tncorrie and rural versus suburban and urban

328 Policy Studies Journal

districts is discussed Some policy aiternatives for dealing withthe problems of education and poverty in rural areas are outiined

RURAL POVERTY AND EDUCATION IN INDIANA

indiana has not traditionally been regarded as a state with ahigh incidence of poverty, either rurai or non-rural in 1969, atthe beginning of the period over which the schooi finance studieswere conducted, 9 7 percent of the state's residents had incomesbelow the poverty levei, compared with a US average of 13 7percent By 1979, the US population with incomes below thepoverty levei declined to 12 4 percent Indiana, aiong with othernorthern "rust-belt" states, has been hurt over the last twodecades by the deciine in high-paying manufactunng jobsMoreover, the state currently ranks well below the average ofthe 50 states in median personal income leveis

There are a number of counties in indiana with povertyieveis considerabiy above the nationai average, in which agricul-ture IS more nearly subsistence than commercial Conditions inthese counties are not unlike those found in some of the iow-income counties in the Southeastern United States Crawford andBrown Counties, with a very high percentage of rural non-farmpopuiation. have a very high percentage of peopie beiow thepoverty ievei Crav r̂ford County poverty rates are neariy twicethe nationai average Both counties have a singie county-widepubiic schooi system Crav r̂ford County has the lowest averagefamily income of any county in the state Very Iittie of thepopuiation in Manon County (Indianapolis), Ailen County (FortWayne), and Lake County (Gary) is classified as rurai Ahtoughthese cities have a considerable number in poverty, on a per-centage basis they had an incidence of poverty comparable to orbeiow the state average

Most rural areas in Indiana contain primarily commercialrather than subsistence farms Recent financiai problems ofcommerciai farms in corn-beit states has ied to decreased farmincome in Indiana There is a close association between therurainess of a county and the poverty ieveis of its residentsEven though indiana does not have the highest incidence of ruraipoverty, the variation in conditions makes the state nearly idealfor study Pubiic schools in Indiana inciude iarge urban districts,high-income non-rurai suburban schools, schools in commerciaicorn beit farming areas, and schoois tn counties where theagncuiture is subsistence

Rural Poverty and Public Policy 329

SALARIES, TRAINING AND EXPERIENCE OF TEACHERS

A study pubiished in 1975 (Debertin and Huie. 1975)examined determinants of average salary levels and training andexperience of schooi teachers among pubiic schooi districts Onemodei assumed that the average saiary level of teachers in apubiic school district was a function of a variety of sociai andeconomic characteristics of district residents inciuding income andpoverty measures, educationai levels population density and theamount of assessed valuation backing each pupti in the districtThe modei was represented by a regression equation to expiainvariation tn average saiary ieveis among districts based on incomeand poverty leveis as well as other sociai and economic charac-teristics of famiiies in the distnct

Variabies found to be significant determinants of teachers'saianes were mean family income district popuiation density, thepercent of the popuiation over 65 the percent of the popuiationthat graduated from coiiege. district assessed valuation, and thepercentage of the popuiation consisting of schooi-age chiidrenPoverty measures as represented by the percent of chiidren onAFDC and the percent of famiiies beiow S3000 were highlycorrelated with the mean income measure, and did not explainvariation in average salaries of teachers Resuits of the anaiysissuggested that teachers in high income suburban and urbandistncts earn higher salaries than those in tow-income and ruraldistncts cetens panbus Moreover, salaries were higher indistricts where the population is coiiege educated and weightedtoward school age chiidren

Another modei represented the demand for and suppiy ofteachers with different ieveis of training and experience Thedemand for teacher training and experience was assumed to belinked to the income of district residents, assessed valuationbacking each pupii, the percent of the popuiation over 65, thepercent of the popuiation consisting of schooi age chiidren. andthe percentage of the aduit popuiation that graduated fromcollege Weii trained and experienced teachers were assumed tobe less wiliing to iocate in densely populated areas, areas inwhich a high proportion of the families were AFDC. or areaswhere a high proportion of the families were beiow the povertyievei These variabies were included in the supply equationsExperience was measured by the average number of years sincethe teacher received initiai certification Training was measuredby a weighted average of the percentage of teachers holding


M S , Ph D or Ed D degrees for the district The price ofexperience was assumed to be the increment for an additionaiyear of experience as taken from the saiary schedule for thedistrict, the price of training was the weighted increment paidfor a graduate over a Bachelor's degree, aiso taken from thesaiary schedule Key findings were as follows

School districts wtth high poverty levels were found to haveexperienced, not inexperfenced teachers Low income districtswere not found to have probiems In retaining teachers Teachersin rurai schooi districts were found to be neither iess experi-enced nor more experienced than those in suburban and urbanschools High income districts were willing to pay more for anadditionai year of experience than were iow income districtsHowever, high income districts were not necessariiy moresuccessfui in retaining experienced teachers Teachers in highincome districts may have had more opportunity for otherempioyment, whereas a teacher in a iow income district may stilihoid one of the better paying jobs in the iocai community Theiack of enroiiment growth in iow income areas may mean thatfew new teachers need to be hired each year, resulting in highaverage experience ieveis for these districts

Therefore, teachers in low-Income rural districts teixl to beat least as experienced as those in other districts, even thoughthey may not be paid as well Despite iow saiaries, they stilt maybe receiving relatively high pay in comparison with other jobs inthe community, and teacher turnover was low enough to usuaiiynot present a serious problem for the iow-income rurai districtSince the retention of expenenced teachers is not a particuiarprobiem in low-income rurai districts, public policy need not bespecificaiiy directed toward attempting to decrease teacherturnover rates in rurai districts with a high incidence of poverty

in districts with high poverty levels hc4d degreessimHar to those found in other districts There was Iittie supportfrom the Indiana data for the argument that teachers In povertyprone areas were less weil trained than those in other areasHowever, schools in rural areas were found to have slightly fewerteachers holding graduate degrees than other schools This is inpart due to lessened access to colieges providing graduate degreesin education Schooi districts in which a high proportion of thepopuiation hold coiiege degrees tend to have the most teachers


holding advanced degrees, and the average education levei ofresidents may be iower in rurai than in urban districts Thepolicy probiem in the iow-income rural district is primariiy oneof deveioptng a pian for ensuring that teachers have ready accessto graduate or continuing education programs Given the access.It ts not surprising that schoois in communities where largeuniversities exist, such as Bloomington and West Lafayette, tendto have schooi systems in which a very high proportion ofteachers have graduate training

COURSE OFFERINGS AND PUPIL/TEACHER RATIOS

A study pubiished in 1977 anaiyzed the impact of incomeand other variabies on eiementary and secondary pupit/teacherratios, secondary course offerings and other school characteristics(Debertin 1977) The modeis were similar to those used in thedetermination of teacher training, experience and salary levelsThe modeis represented pupii,/teacher ratios at elementary andsec ondary leveis and the number of courses offered by thedistrict at the secondary levei, a measure of the diversity ofcurriculum offerings

it was hypothesized that pubiic schoois with iarge enroii-ments wouid operate at high pupii teacher ratios at both theelementary and secondary ieveis but should offer more courses atthe secondary level than iow-enrotiment districts, cetens panbusMoreover, schoois with iow pupil teacher ratios shouid be inareas where famiiy income ieveis and per pupii assessed valua-tions are high where a high proportion of the populationgraduated from coiiege and a smaii proportion of the popuiationIS over 65, everything eise being equai These districts shouldaiso be those that offer the greatest number of courses in thehigh schoois Each individuai elementarv or secondary schoolplant, rather than the distnct as a whoie was represented in thedata

Findings Iargeiy confirmed the hypotheses Schools in high-income areas and areas with high per pupii assessed valuationswere found to have iow pupil/teacher ratios, particularly thosewtth smaii enroiiments Large-enroilment districts located in iow-income areas were found to have high pupii/teacher ratiosHowever, large-enroiiment districts are not usuaiiy found in ruraiareas The sparsity of popuiation in many rural areas may keepenrollments down in each building, and Dupil teacher ratios in


smaii schools located In low-Income rurai areas may actually bequite iow

Many rurai districts may have iimited enroiiments, andbecause of population sparsity may be forced to operate at iowpupil/teacher ratios The effects of enrollment and assessedvaluation may mask any impacts of income on pupii/teacherratios in indiana, the correiation between family income andproperty tax wealth as measured by per pupii assessed valuationIS very near zero

Pupii/teacher ratios will normaiiy be iower tn sparseiypopuiated districts than in other schoois it can be very costiyon a per pupii basis to operate a schooi district at a iowpupil/teacher ratio, even if saiary leveis are only moderatePubiic poiicy through legislation needs to be specificaiiy aimed atensuring that those districts in sparsely populated rurai areas arefunded at ieveis sufficient to reaiisticaiiy cover the costsassociated with the sparse popuiations and the iimited enroii-ments This public poiicy issue is of even greater concern inmany sparsely-popuiated states in the West

The major determinant of course offerings in high schoolswas found to be enroiiment However, famiiy income ieveis aisowere found to have a significant impact Rurai high schoolsfrequentiy have iow enroiiments compared with their counterpartsin suburban and urban areas Therefore, high schoois in low-income rurai areas may iack breadth in curricuium This is onekey difference between smaii rural high schoois iocated in iow-income areas, and their counterparts in other areas Such schoolsmay have more iimited offenngs, both in vocationaiiy-orientedprograms as weii as in courses designed as preparation forcotiege This probiem has stimulated pubiic poiicy directed towardschooi consoildation tn indtana and in many other states

Pubiic poiicy for dealing with secondary curricuia in indtanaand in most other states is usuaiiy aimed at estabiishing aminimum program which each high schooi must offer Thesemintmums are then graduaiiy increased over time While thisapproach has vaiidity, a disparity normaiiy remains between theavaiiable offenngs in iow-income rurai districts in comparison totheir suburban and urban counterparts Expansion of curnculausuaiiy takes piace if it can be achieved without a significantreduction in the pupil/teacher ratio (resuiting in a significantincrease in per pupii expenditures) Such an expansion is tessiikely in sparseiy-popouiated rurai distncts with smaii enrottmentsunless pubiic poiicy is specificaiiy directed at increasing per pupH

Rurai Poverty and Public Policy 333

funding to compensate the district for the increased costsassociated with the expansion of the curricuia Public poiicydirected toward the consoiidation of smaii high schoois couid leadto an improvement in curncula. but such improvements may be atieast partially offset by the added cost of busing for the districtand additionai travei time for students Joint programs betweenschoois is another possibiiity Most states provide additionaisupport to at least partialiy offset the cost of busing in ruraiareas

STUDENT DROPOUTS

A study pubiished by the authors in 1974 (Debertin andHuie. 1974) estimated a "production function" for the generationof dropouts in a schooi district The hypothesis underiying thestudy was that both socioeconomic factors outside the schooi andcharacteristics of the schooi infiuenced the number of dropoutsVariabies inciuded schooi-related variables such as pupii/teacherratios, enrollment, and teacher experience, degrees held, andsatanes Atso included were community-reiated variabies such aspopuiatton density, income, and the percent of the districtresidents that graduated from coiiege

The reiationships that govern the generation of a schooidropouts were found to be compiicated Large enroiiment districtswere found to have more dropouts than iow enrollment distncts.btit popuiation density per se was not found to be an importantfactor in indiana, iow income districts produced siightiy moredropouts than did high income districts Schools with experiencedteachers produced fewer dropouts cetens panbus. but many ofthese were in iow-income rurai areas The proportion of teachersholding graduate degrees was not a factor Schools iocated indistricts where a high proportion of the popuiation has graduatedfrom college produced few dropouts

Thus, schooi dropouts are not a problem of rural schools perse North Dakota the most rurai state in the nation with thehighest proportion of its population living on farms, and a statenot having high famiiy income ieveis by nationai standards, aisohas one of the iowest schooi dropout rates in the nation Moreimportant are attitudes of district residents toward education inindiana. dropouts are iargeiy a probiem in urban areas Manyrurai schools in the Southeastern United States have high dropoutrates, but this is probably a socioeconomic problem rather than a


problem to be biamed on probiems with the iocai school districtsThere appear to be few variables under controi of the schooiadministrator that can directiy reduce dropout numbers Publicpolicy might better be directed toward making the pubiic schoolattractive to students by ensunng that the schools have excellentteachers and the curricuia have sufficient breadth to meet theindividualized needs of the students, rather than by the fundingof specific programs designed to directiy deai with the dropoutprobiem

PROPERTY WEALTH. INCOME, AND EXPENDITURES

The extent to which the property tax shouid be used as afunding source for public education was a topic of considerabielegislative Interest during the 1970s in many states Much of thislegislative interest occurred as a result of court cases arguingthat the kind of education a student receives in a pubiic schoolshouid not be linked to the property weaith in the districtPiaintiffs argued that inadequate funding for pubiic schoois indistricts with iow income and/or property weaith led to unequaleducationai opportunity for student from those distncts, and thiswas in violation of the "equai protection under the iaw" ciause ofthe U S Constitution

i n a iand mark case, San Antonio School District vRodriguez (1973), the Supreme Court ruled that funding for iocaipublic schools need not necessarily be the same across aiidistricts in the state, and that states which had unequal fundingacross districts did not necessariiy violate the equai protectionunder the law ciause of the U S Constitution By this time,however, there was considerable pubiic and legislative support Inmany states for reducing the use of the property tax as a sourceof revenue for pubiic schools, even in states that had nottraditionaiiy used the property tax as a major source of revenuefor education

A 1984 study (Debertin. Ciouser and Pagouiatos, 1984)expiored the differentiai impacts among rurai, urban and suburbanschoois of property tax reiief programs enacted in the 1973indiana General assembiy Before the property tax reforms wereimpiemented, Indiana obtained approximateiy two-thirds of therevenue for the support of pubiic schoois from the local propertytax By 1984. this figure had dropped to approximateiy one-third,with taxes ievied at the state levei picking up the most of theremainder


In the 1984 study, separate models were estimated for eachof seven school years for rural, suburban, and urban schooldistricts to explain variation m per pupii expenditures forinstruction and average teachers' saiartes The expianatoryvariabies tnduded income, assessed valuation per puptl. thepercent of housing that is owner-occupied, and the percent ofthe population that is non-white

Famiiy income was found to be an important determinant ofteachers salaries in equations for rurai. suburban, and urbanschoois Family income had a negative impact on the ievet of perpupii expenditures for instruction for rurai school distncts, asiightiy positive impact for urban schoois but was not importantat aii for suburban schoois

Assessed valuation was found to be an important deter-minant of per pupii expenditures in rurai, suburban, and urbandistricts, but was important in determining saiary levels forsuburban and urban schools oniy A key characteristic of districtswith high assessed valuations is that they operate with iowpupii/teacher ratios Assessed vaiuatton was shown to be a iessimportant determinant of educationai expenditures than was truebefore the property tax reform package was impiemented

Therefore, pfc^>erty tax reform programs which reduced thereliance of school distrk^s on tfie \ocsA property tax as a sourceof funding have made expenditures in public schools less dosdytied to the socioeconomic cfiaractenstics of distnct residentstfian was previously true Linkages between socioeconomiccharacteristics of districts and funding for pubiic schoois remainvery dependent on the particular method chosen to distribute taxdollars coliected at the state level back to local schools Thegoal of any school distribution formula shouid be to ensure thatevery student has equai access to a good education This doesnot mean that alt publtc schoois should be identical or necessariiyfunded at the same levei of spending per pupii Rather, eachpubiic schooi shouid refiect the specific needs of the studentswithin the locai district Pubiic policy shouid be specificallydirected at ensuring that the school distribution formula providesenough revenue to meet the needs of the public school students,regardless of whether incomes are high or low or whether thedistrict is iocated in an urban a suburban, or a rurai area


IMPUCATtONS

Large urban areas, with their considerabie voting power tnstate legislatures, may exert considerabie influence to thedetriment of schooi districts located in sparsety-populated ruralareas Legislative emphasis in some states has been primaniy onthe development of a funding formula which ensures that taxdoiiars for large urban distncts are availabie it is important thatequal iegisiattve emphasis be gtven to the unique probtems facedby rural schoot districts, particuiariy those where the medtaneducattonai ievei is low and the percent of the popuiation at orbelow the poverty ievei Is high These districts are likeiy tospend stgnificantiy iess per pupil than other districts, and Ifgiven the option will not tax themselves as heavily for thesupport of public schoois as wiii high-income suburban and urbandistricts

Schoot districts in iow-income rural areas may be abie toempioy and retain good teachers at iower salaries than schoois inhigher income suburban and urban districts for at ieast tworeasons First, "battle pay" may be needed in some urban schooisSecond, cost of iiving differentiais may be needed in non-ruraldistricts to offset the higher cost of housing and to maintain acompetitive wage rate with non-teaching positions However, overthe longer term, teacher saiaries must be sufficient both toattract and retain the highly skiiied individuals tn the professionThis Is a problem not oniy for iow-income rurai districts, but forali other schoot dtstricts as weii

There was iittie evidence in the indiana data to suggestthat pubtic school systems located in iow-income rurai areas havesignificantly different input charactertsttcs than their suburbanand urban counterparts, whtch in turn wouid contribute to arepeating poverty cycte Teachers in rurat schoois tended to bemore experienced, and population sparsity often ieads to compara-ttveiy low pupii/teacher ratios, even In iow-income rurai districtsHowever, iow-income rurat districts had fewer teachers holdingadvanced degrees, and the breadth of the high schoot curricuiawas somewhat tower Assuming that a iack of sufficient courseofferings in such schoois teads to graduates who iack some of thenecessary sktiis for employment in companson with studentscoming from other distncts, or who tack some of the sktiisrequired to attend college, then public policy and state fundingcouid be aimed specifically at improving curricuia in high schoolsiocated in iow-income rurai areas


REFERENCES

Bowies. Samuei 1968 "Towards Equality of Educattonal Oppor-tuntty " Harvard Educational Review 38(1) 89-99

ColetTian, James S. et al 1966 EauaUty of Educational Oppor-^tunity U S Offtce of Educatton

Deberttn Davtd L 1977 'impacts of Communtty Charactertsttcson the Attrtbutes of Pubiic Education" Southern Journal otAgricultural Economics 9(2)

Deberttn David L, Rodney L Clouser and Angeios Pagouiatos1984 "Impacts of Property Tax Reltef on EducationalExpenditures in Rural Areas" North Central Journal ofAgricultural Economics 6(2)

Deberttn David L and John M Huie 1975 "Factors tnfiuencingthe Demand and Suppiy of Public School Teachers AnExploratory Analysis ' Journal of Socioeconomic PtanningSciences 9(6)

Deberttn. David L and John M Hute 1974 ''What Can the PublicSchool Do to Reduce Dropout Numbers " Southern Journal ofAgricultural Economics 6(2)

Greenbaum. Wiiitam N 1971 "Serranto vs Pnest Implications forEducationai Equality ' Harvard Educationai Review 41(4) 501-534

Kiesltng Herbert 1967 "Measurtng a Local government Service AStudy of Schoot Districts tn New Yori< State" Review ofEconomics and Statistics 49(3) 356 376

Kirp. Davtd 1968 'The Poor the Schools and Equal Protectton"Han/ard Educational Review 38(U 635-668

Michelson. Stephen 1972 "For the Plaintifts-Equal SchoolResource Allocation ' Journal of Human Resources 7(3) 283-306

Moynihan. Daniel P 1968 "Sources of Resistance to the ColemanReport" Hansard Educational Review 38(1) 23-36


San Antonio School District v Rodriguez 1973 US SupremeCourt No 71-1332

Zimmer. John M 1967 "Expenditures for Public Elementary andSecondary Education as Classified by the Relative PovertyStatus of their Rural Populations" Journal of FarmEconomics 49-2{5) 1204-1208

Documents

Rural Poverty, Funding for Education, and Public Policy