Sec. 2. Findings
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Section 1125AA of the Elementary and Secondary Education Act of 1965 ( 20 U.S.C. 6336 ) is amended— by amending the heading to read as follows: ; and by amending subsection
(a)to read as follows: Congress makes the following findings: The current Basic Grant Formula for the distribution of funds under this part does not adequately target funds for schools with the highest concentrations of economically disadvantaged students. The poverty of a child’s family is much more likely to be associated with educational disadvantage if the family lives in an area with high proportions of poor families. The current formulas for distributing Targeted and Education Finance Incentive Grants is intended to allocate more funds per formula student to local educational agencies with higher concentrations of such students. These formula use two weighting systems, one based on the percentage of the aged 5–17 population in a local education agency that is eligible to receive funds under this title (percentage weighting), and another based on the absolute number of such students (number weighting). Whichever of these weighting systems results in the highest total weighted formula student count for a local educational agency is the weighting system used for that agency in the final allocation of Targeted and Education Finance Incentive Grant funds. Since the amount available to be distributed through these formulas is fixed by congressional appropriation, any gain in allocation share by one local educational agency causes a loss to other local educational agencies. The number weighting alternative is often favorable to very large local educational agencies, even if the agency’s formula student percentage is low. But because smaller local educational agencies simply do not have enough students to gain from number weighting, they are rarely better off under the number weighting alternative. The Congressional Research Service has compared the funding allocations of each local educational agency for school year 2008–2009 under the current dual weighting system with the funding allocation it would have that year if all local educational agencies had their student count weighted only by percentage weighting. This data shows that the use of number weighting in these formulas has shifted funding from smaller to larger local educational agencies notwithstanding the level of poverty in either. This is contrary to the intent of Congress, which is to direct more funding per formula student to local educational agencies with high concentrations of poverty, as measured by the number of formula students as a percentage of the aged 5–17 population of the local educational agency. As a result of this unintended consequence of the number weighting system, 338 of the 340 local educational agencies that have over 38.25 percent formula students gain nothing from number weighting under the Targeted Grant program, 281 of them actually lose funding because of number weighting, and 83 of those 340 highest poverty local educational agencies would actually be better off if Targeted Grant funds were allocated using the Basic Grant formula with no weighting system at all. Congress has a responsibility to correct this unintended inequity by reducing the power of the number weighting system relative to the percentage weighting system so that local educational agencies with high percentages of poverty but low numbers of students are not disadvantaged under the formulas used for grants under this part. .
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