Frequently Searched

Taxpayers and students deserve more transparency and efficiency with school funding.

February 9, 2016

Despite recent reports, changes to Payson Unified School District’s budget and those of other Arizona districts are not a disaster but an exercise in efficiency that is long overdue.

For years, Arizona districts have counted the number of students enrolled in the spring and based the next year’s budget on that figure. This is an inaccurate practice because students change schools for many reasons—their parents may get new jobs in a different part of town, and students move in and out of Arizona for this and many other reasons (graduation and grade promotion, to name just a few). In 2012, Goldwater Institute research found the practice of funding based on last year’s student count (“ghost students”) cost taxpayers $125 million because we pay for empty seats in some schools and pay twice for students in other schools.

Meanwhile, charter schools are funded based on more updated student counts, avoiding the waste. Charter schools report enrollment periodically during the school year and have their funding adjusted accordingly. This means charter schools are already practicing the updated budget process that the media says will throw districts into “chaos.”

In school districts where students have graduated or transferred, causing their enrollment to dip, the practice of funding ghost students has padded district budgets at taxpayer expense and done nothing to improve student achievement.

Fortunately for taxpayers, Gov. Doug Ducey’s state budget last year included a provision to update the state’s funding formula so that taxpayers fund every school based on the students schools are educating and enrolling today, not at some point in the past.

A recent report found that 64 percent of school districts will be impacted by the change. To put this in perspective, according to the state auditor, just 4 percent of school districts (9 districts total) have “high financial stress” levels based on factors such as the change in the number of district students and operating reserves. In contrast, 151 districts, or 73 percent have “low stress” on the same scale. Hardly a fiscal tsunami.

Current student funding counts will make Arizona a national leader for transparent, accurate school finance. Researchers have found similar inefficient practices like Arizona’s outgoing system around the country. Taxpayers and students deserve better.



More on this issue

Donate Now

Help all Americans live freer, happier lives. Join the Goldwater Institute as we defend and strengthen freedom in all 50 states.

Donate Now

Since 1988, the Goldwater Institute has been in the liberty business — defending and promoting freedom, and achieving more than 400 victories in all 50 states. Donate today to help support our mission.

We Protect Your Rights

Our attorneys defend individual rights and protect those who cannot protect themselves.

Need Help? Submit a case.

Get Connected to Goldwater

Sign up for the latest news, event updates, and more.