The last time Indiana had a Small School Grant was in the 2010 and 2011 school years. There have been numerous changes in legislators and school leadership over that time. We asked the DOE what the actual allocations in the budget were for the Small School Grant in those years. We sent the data to our members, and we noted that the grant accounted for about $16 million in categorical support for small schools. When we look at the total dollar amount spent on tuition support, this is not an overwhelming amount. This link has the amount allocated based on school data. (size and demographics.) Not every small school received a grant.

Teacher pay is a key question right now. What is the best way to raise teacher pay? Since 2010, the Indiana General Assembly decided to add a funding mechanism for teachers called the TAG Grant and the Small School grant was eliminated after 2011. All funding follows the students in Indiana. The TAG Grant pays teachers for student performance. The school would generate funding per student per teacher for positive data like passing a test or creating a high school graduate. We could spend hours discussing if the TAG grants improve teacher performance. That is a separate question altogether. We asked ourselves how funding compares for small and rural schools based on the TAG grant amounts in 2020 compared to the Small School Grants of 2010? Which model of funding had a better chance of raising teacher pay for a small or rural school district? The analysis is only for those schools that received a Small School Grant in 2010, so not all schools are included. The results are in this spreadsheet.

Reviewing the data some clear issues jump out to us.

1. The schools in the analysis group lost on average $92,482.97 when comparing the 2010 Small Schools grant to 2020 TAG grant amounts.
2. Four schools had higher funding levels with TAG Grants. One of the school districts achieved this because of their online virtual program significantly increased the number of teachers and students they had from 2010 to 2020.
3. Some could argue that TAG grants are guaranteed to go to teacher salaries. The Small School Grant was not guaranteed to go to teachers. If we took 65% of the Small Schools Grant Funding from 2010 and said this amount all went to teacher salary and benefit costs, The average district loss when comparing the two funding levels was still $45,000 per district.

Overall, the TAG Grant has been a way to reward teachers for performance. When compared to Small School Grant in the past, it has not been an equitable replacement. We realize the TAG was never designed to be a replacement for the Small Schools Grant; however, we want to document that this is another piece to the overall school funding picture. Small schools do not have the student populations or teacher populations to create a sizable funding amount that moves the needle on teacher salaries. Even though it was only $16 million in 2010, it did result in more funding for those schools that received it than TAG grants today. When we look at the dollars spent in the past, the Small School Grant was not a make or break amount when examining the total picture of tuition support state-wide. Making sure dollars reach the teachers is essential. The schools that received a Small Schools Grant in the past have lower overhead costs based on the size of their central office and the number of administrators. Under the current legislation, the Small School Grant Model drives more dollars to the classroom than TAG Grants based on past practices and funding levels even when using the standard of 65% of the funding goes to teacher salaries and benefits.

It is essential to understand what the Small School Grant was and how it compares to current funding models. This information is crucial for those advocating for its return and the policymakers who decide this. The TAG grants may work for some school districts. We are not against rewarding people for performance. The analysis here is just asking which funding mechanism drove more dollars to the classroom. Even though it was ten years ago, it is easy to see that for the districts small enough to receive in a Small School Grant in the past this model delivered more dollars than TAG.

The Small Schools Grant may be unpopular in a policy world that favors dollars follow the students. However, there are some fixed variables schools can not control.
1. The assessed value of the school district.
2. The size of the district and their student population density. (or business)
3. The number of bus miles they have to travel each day.
4. Whether their energy supplier is an REMC, municipality, or a private vendor.
5. The internet connectivity levels of their community.

Each one of these variables can negatively impact the funding levels for a small or rural school and there is nothing the school board or administration can do via fiat to fix this.

Our next newsletter will explore how Policymakers can help schools lessen the fallout for these variables and document their impacts. Our members are working hard to drive more dollars to the classroom. They are forced to do so to compete for staff and faculty. Long term we want everyone to recognize this is a heavy lift when comparing the overall budgets based on the size of the district.

Chris Lagoni
Executive Director
Indiana Small and Rural Schools
indianasmallandrural@gmail.com