Title I Funding Has Doubled — But Its Most Potent Formula Is Stuck in the Past

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Last year, lawmakers approved $18.4 billion for Title I, the largest line item for K-12 education in the federal budget and a vital resource for ensuring all students get the education they need. But despite two decades of steady increases to Title I, including $1.8 billion over the last two years, Congress may not realize it’s ignoring one of the most effective tools for directing that money to the schools it’s intended to serve — the Concentration Grant.

That’s one of the key findings in our new series of reports on Title I, and why we’re urging Congress to reexamine how it funds Title I moving forward.

To understand why Congress is overlooking the Concentration Grant requires a brief history lesson. Title I provides extra funding to school districts serving students living amid high concentrations of poverty, but it isn’t distributed using a single formula. It relies on four distinct, complex funding formulas that each receives its own appropriation. Basic Grants, the original formula enacted in 1965, get the most money, followed by Targeted Grants and Education Finance Incentive Grants. Concentration Grants are the smallest.

Since No Child Left Behind passed in 2001, funding for Basic and Concentration grants has been frozen and all new money for Title I has been allocated using the two newest formulas, Targeted and Education Finance Incentive grants. Congress added these formulas because the Basic Grant ”often does not provide funds for the economically disadvantaged students for which such funds are targeted.” The Basic Grant gives districts in a state the same amount of money per child living in poverty, regardless of whether a district has a poverty rate of 3% or 33%. Targeted and Education Finance Incentive grants were designed to provide more money per qualifying child as a district’s poverty rate increases. 

These three grants have dominated conversations about Title I. The smaller Concentration Grants, like the Basic formula, provide districts with a flat amount of money per child living in poverty. However, they have much stricter rules about which districts are eligible. To get a Basic Grant, a district needs a 2% poverty rate and 10 children living in poverty — criteria that 95% of districts in the country meet. The two newer formulas require a 5% poverty rate and 10 qualifying children, which 88% of districts have. But Concentration Grants expect districts to have a 15% poverty rate or 6,500 children living in poverty. As a result, fewer than half of districts are eligible.

These criteria make Concentration Grants particularly effective at targeting Title I to high-poverty districts. All4Ed commissioned economists Nora Gordon and Sarah Reber to simulate which districts would benefit most from $10 billion in new Title I funding if the dollars were distributed solely through one of the existing formulas, instead of all four. Concentration Grants were the surprising standout, far outpacing Basic Grants and even edging out Targeted and Education Finance Incentive grants to give districts with the highest poverty rates the most Title I funding per qualifying child. Using the Concentration Grant alone would provide the highest-poverty districts $1,530 per child living in poverty, nearly $400 more than the Basic Grant. This means a district in the top 10%, based on its poverty rate, that enrolls 1,500 children would receive at least $165,000 more in Title I if the Concentration Grant were used instead of the Basic Grant. This difference compounds as enrollment increases. A similar district with 10,000 children would receive at least $1.1 million more using Concentration Grants than Basic Grants — funds that could be used to hire and train teachers, upgrade curriculum and more. 

The research is clear: Education funding matters. Better-resourced schools tend to produce better student outcomes, including higher academic achievement and graduation rates. Yet, there’s also clear data showing that districts with higher poverty rates, more students of color and more English learners receive less funding from state and local sources than districts that serve fewer of these students. Title I can help fill these gaps and, ideally, provide districts with the extra funding they deserve — but only if the formulas target funds to those with the greatest needs.

It’s been over 20 years since Congress seriously examined how Title I funding works. Ensuring that no new funds were doled out through Basic Grants since 2001 has certainly helped Title I target students living in concentrated poverty. However, given these new findings about the Concentration Grant and why it’s so effective at supporting districts with the highest poverty rates, it’s time for Congress to give it another look. Unfreezing Concentration Grant funding by increasing its appropriation in the next budget — and, in the long term, evaluating whether other formulas like Targeted and Education Finance Incentive grants should have higher eligibility criteria too — would go a long way toward helping Title I further meet its mission to guarantee educational opportunities for historically underserved students.

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