Elementary and Secondary Education Expenditures
Spending on elementary and secondary education includes the operation, maintenance, and construction of public schools (kindergarten through high school, or “K–12”) and spending on other educational facilities and programs provided through the school system (e.g., libraries, technical-vocational training, school lunches, guidance counseling, and some adult education). It does not include spending on higher education.1
- How much do state and local governments spend on elementary and secondary education?
- How does state spending differ from local spending and what does the federal government contribute?
- How have elementary and secondary education expenditures changed over time?
- How and why does spending differ across states?
In 2017, state and local governments spent $660 billion, or more than one-fifth (21 percent) of direct general spending, on elementary and secondary education.2 Elementary and secondary education was the second largest source of direct spending at the state and local level in 2017, only slightly trailing spending on public welfare (which includes Medicaid). K-12 education spending was the largest source from 1977 to 2015. If federal transfers are excluded, elementary and secondary education is still the largest state and local spending item.
Nearly all (90 percent) elementary and secondary education spending goes toward operational costs, such as salaries and benefits for public school employees engaged in instruction; administration; guidance counseling; textbooks; and other auxiliary services operated through the school system, such as transportation to schools and lunch programs. The remaining 10 percent is spent on capital outlays, such as school construction and renovation and some equipment purchases.
Local governments spend far more of their budgets directly on elementary and secondary education than states. In 2017, 40 percent of local direct general spending went to elementary and secondary education compared with less than 1 percent of state direct spending.
The lopsided direct spending occurs because K–12 education services are typically delivered to students directly by local school districts (or sometimes municipalities or townships) and not states.3 In 2017, 99 percent of direct K–12 spending occurred at the local level. Only in Alaska, Hawaii, Kentucky, and New Jersey did state governments deliver 5 percent or more of direct K–12 spending. Hawaii was an outlier because the Hawaii State Department of Education operates public schools and thus 100 percent of its direct educational spending occurred at the state level.
However, while localities directly spent the money, a majority of it was financed through state and federal funds. In the 2015–16 school year, the federal government provided 8 percent of total revenues for elementary and secondary education ($56 billion), states provided 47 percent ($323 billion), and local governments provided 45 percent ($307 billion).4
The share of elementary and secondary education revenues coming from states has increased over time. In 1972, states’ share of elementary and secondary education revenues was only 38 percent, but it grew to 49 percent by 1987.5 This increase has been attributed to court decisions, or the threat of court decisions, beginning with the California Supreme Court’s 1972 Serrano v. Priest decision, which mandated states increase equity and adequacy in their education finance systems.
In 1977, state and local governments spent $289 billion on elementary and secondary education (in 2017 inflation-adjusted dollars). In 2017, they spent $660 billion.
However, between 1977 and 2017 other state and local spending (mostly Medicaid and thus public welfare) grew faster than elementary and secondary education. In 1977, 26 percent of direct general expenditures went to elementary and secondary education compared with 21 percent in 2017.
Differences in per capita and per pupil spending highlight important variation in spending on K–12 education across states. Nationally, state and local governments spent $2,030 per capita on elementary and secondary education in 2017. At $3,999, the District of Columbia spent the most per capita on elementary and secondary education.6 Among the states, New York ($3,517), Wyoming ($3,298), Alaska ($3,172), and New Jersey ($3,068) spent the most. State and local governments in Arizona spent the least on elementary and secondary education at $1,170 per person, followed by Idaho ($1,283), Florida ($1,351), North Carolina ($1,424) and Hawaii ($1,453).
Per capita spending is an incomplete metric because it doesn’t provide any information about a state’s demographics, policy decisions, administrative procedures, or residents’ choices.
States whose governments spend the most per capita on K–12 education tend to have higher labor costs or employ more teachers per student, but they are not necessarily home to the most students. New York, for example, has relatively few school-age children as a share of total population, but the state has more teachers and staff per student than nearly any other state. It also pays them more, resulting in higher spending despite fewer kids.7
Some states that spend the least per capita on K–12 education have the most kids and high enrollment in public schools. For example, a large percentage of Arizona’s population is school-age children, and many of them are in public schools, but the state has fewer teachers per pupil and lower salaries than other states, translating to low per capita spending. In contrast, Hawaii has relatively few school-age children and low per capita spending but not relatively low per pupil spending because it has more teachers and higher pay than many states.
Thus, per pupil spending can provide a more nuanced picture because it reflects spending on students that are enrolled in the public K–12 educational system. However, it still does not provide complete information about policy decisions, class sizes, or labor costs.
Overall, the United States spent $13,025 per pupil in 2017.8 Among the states, New York spent the most per pupil ($25,288), followed by Wyoming ($20,255), New Jersey ($19,364), and Vermont ($18,755). The District of Columbia's per pupil spending was $31,864. These states also generally had the most per capita spending in 2017. Per pupil spending was lowest in Idaho ($7,320), Arizona ($7,421), Utah ($7,666), Oklahoma ($8,296), and North Carolina ($9,414).9
Interactive Data Tools
Making Sense of State School Funding Policy
Matthew Chingos and Kristin Blagg (2017)
Assessing Fiscal Capacities of States: A Representative Revenue System–Representative Expenditure System Approach, Fiscal Year 2012
Tracy Gordon, Richard Auxier, and John Iselin (2016)