For years, Ohioans didn’t mince words about the condition of the state’s public schools. One citizen called them “deplorable.” A state senator said they were “drab places” more akin to “punishing institutions.” One lawyer argued they were “crumbling,” “leaking,” and “dilapidated.”
And these concerns weren’t just anecdotal. According to a 1995 survey, three-quarters of Ohio school buildings had a major defect—the worst of any state. The survey found that a third had inadequate roofs, and 40 percent had inadequate plumbing.
Eventually, the state’s supreme court intervened. During the DeRolph v. State trial, Chief Justice Thomas Moyer asked how students could receive a state constitution–mandated “thorough and efficient education” in buildings “where plaster is falling on their heads.” In 1997, a decision was finalized: Ohio’s school funding mechanisms were unconstitutional and had to be changed.
Since the DeRolph ruling, Ohio has steadily improved its equitable capital expenditure funding. The state introduced an “equity list,” which prioritizes school districts with low property and income wealth per pupil, meaning districts that couldn’t raise funding themselves could receive help from the state to repair their buildings. In 2007, capital expenditure funding in Ohio had progressive capital outlays spending, meaning the average student from a household at or below the federal poverty level was enrolled in a district that spent more capital outlay than a district attended by a typical student from a household not living in poverty.
But this progressivity is not the norm nationwide. Today, less than half of states see more or equal spending on capital outlays in districts with high shares of students from low-income backgrounds. As a result, students from low-income backgrounds are more likely than other students to attend schools in need of major repairs.
A new report from the Urban Institute highlights key capital outlay policies—including voter approvals, funding types, facility assessments, state priorities, projects considered, and equity measures—for every state. These practices indicate how each state supports investments in school construction and infrastructure. Below, we highlight three states that have taken different approaches to ensuring more equitable outcomes for their students, and we provide a resource that details capital expenditure approaches for every state.
Colorado: Covering a higher share of costs for districts with limited resources
Much like Ohio before DeRolph, Colorado is a local rule state, meaning each school district plans, builds, and maintains facilities according to its own procedures. And just like Ohio, Colorado was sued for the condition of its school buildings. In some Colorado schools, sewage leaked into the hallways, and some schools lacked hot water, heat, or air conditioning.
After settling the lawsuit in 2000, Colorado introduced state priorities when pursuing facility renovations, chief among them ensuring student and teacher health and safety. Later, the state enacted the Building Excellent Schools Today (BEST) grant program, which offers need-based grants funded through the state land board’s oil and gas revenue and a marijuana excise tax (PDF).
Andy Stine, director of capital construction for the Colorado Department of Education, oversees the BEST application process. The program awards grants through a blind review process, meaning Stine’s office ranks each project by severity of issues in buildings and adequacy of the renovation plan before awarding grants.
The state also scores each district on seven indicators of district wealth, such as property values, students who receive free and reduced-price lunch, and local bond limits. After the projects have been ordered according to priority, the state determines matching funds, with a higher share of funding going to districts that score lower on district wealth indicators. According to Stine, the state share can range from 15 percent of funding to more than 80 percent.
Colorado, unlike Ohio, doesn’t explicitly prioritize districts with fewer resources, but the state does maintain facility assessment records for every school district, so Stine’s office has some idea of which districts may apply in any given year. But the state can award only the funding it has. “While we do a lot and invest in quite a lot of schools, we help maybe 50 percent of the applicants that come in every year,” Stine said. “We still do not have enough funding to address all the needs that are out there.”
Minnesota: Providing districts different funding options
Chris Kubesh, a finance specialist in the Minnesota Department of Education, remembers walking into some school buildings and barely being able to take a breath. Without working air conditioning systems, these buildings had terrible air quality, posing health risks to students and staff members. Through the state’s Long-Term Facilities Maintenance (LTFM) program, these schools were able to use state financial support (through reimbursement of issued bonds) to address health and safety concerns within their existing buildings.
For Minnesota school districts with limited resources to keep up facilities, the LTFM program is one avenue to receive assistance with capital expenditure funding. The state also offers a Debt Service Equalization program and has a Maximum Effort School Aid law, both of which allow districts with small property tax bases to obtain capital expenditure support. Neither program is large (the equalization program allocates less than $30 million statewide, and the maximum effort law serves only two districts, according to Kubesh), but they provide more avenues for districts that cannot rely on local property taxes.
In particular, the LTFM program allows school districts to stay on top of facility needs. The program requires districts to create a 10-year renovation plan (PDF), which the state uses to allocate grant funding for any maintenance that does not change the original use. Although districts cannot use the money to build new facilities, the state support allows schools to address health and safety concerns, increase accessibility, or perform deferred maintenance.
Ohio: Ranking districts by need to award facility funding
In 2016, the Winton Woods City Schools district, just outside Cincinnati, received state funding to build two new campuses. To ensure these buildings met students’ needs and reflected the district’s project-based learning model, the district asked 25 students for input when designing the plans. As a result, the new buildings have distributed dining spaces and libraries instead of central ones, giving students more access to areas where they can study and socialize.
This student-centered approach is foundational to Ohio’s capital expenditures process. “When it comes to student learning, we want the building to support the education and student success,” said Melanie Drerup, deputy chief of planning for the Ohio Facilities Construction Commission (OFCC).
When Winton Woods, which serves predominantly students of color, first applied for state funding in 2014, the district was 107th on the equity list. The OFCC has steadily worked its way down the equity list since the DeRolph ruling, providing larger shares of state funding to districts that have low property values and family incomes per pupil. Localities must cover the costs of the project that the state does not cover.
Because the Winton Woods community did not originally pass a bond to cover the rest of the project’s funding, the district moved to lapsed status, which consists of districts that have had to defer state funding because they couldn’t raise the local share. For lapsed districts, the OFCC will make that funding its highest priority should the district later approve funding the local share.
In 2016, Winton Woods passed a local bond on its third try, and its position on the priority list meant it received around $49 million in state funding for the $107 million project. Since the new construction, Winton Woods superintendent Anthony Smith said he’s seen students treat the spaces with more respect and that school feels more conducive to students and staff members collaborating. “We didn’t want our kids to get used to those conditions,” Smith said. “Now we have a school that matches our educational mission.”
Considering equity can lead to better school facilities for all
The experiences in Ohio, Colorado, and Minnesota show there is no single way for a state to support funding for school facilities. Whether a state uses grants or loans, priority lists or matching rates, how capital expenditures are funded depends on that state’s context and history. But these states show that including some measure of equity in funding formulas can lead to better outcomes for students and staff members in communities with few resources.
Below, we’ve compiled each state’s procedures and equity considerations when allocating school facility funding. Some states work to ensure progressive allocations, while others leave the process up to local rules and resources. For state and local policymakers interested in bettering their school capital funding systems, this resource can reveal best practices and potential strategies to pursue.
Capital expenditure data are drawn from Urban Institute analysis of Common Core of Data and Small Area Income and Poverty Estimates data. National data from Arizona, Iowa, Massachusetts, New Jersey, New Mexico, New York, and Rhode Island are substantially different than state-reported data and should be treated with caution. Data presented are for geographic school districts only.
Qualitative variables of state funding processes were collected by Urban researchers and confirmed by state officials. More robust documentation for each variable and two additional variables can be found in the report.
To provide additional information about your state’s capital expenditure policies, please email us at [email protected].
This feature was funded by the Bill & Melinda Gates Foundation. We are grateful to them and to all our funders, who make it possible for Urban to advance its mission. The views expressed are those of the authors and should not be attributed to the Urban Institute, its trustees, or its funders. Funders do not determine research findings or the insights and recommendations of our experts.
DESIGN Christina Baird
DEVELOPMENT Jeff MacInnes (jeffmacinnes.com)
EDITING David Hinson
WRITING Wesley Jenkins