Saving North Carolina’s Public Education System
How to Stop Those Who Would Betray the State’s Children and Future
As part of its work on public education in America, Civic Way is taking a closer look at one state—North Carolina. This is the fifth essay in Civic Way’s series on North Carolina’s primary and secondary education system (see the last essay). The author, Bob Melville, is the founder of Civic Way, a nonprofit dedicated to good government, and a management consultant with over 45 years of experience improving public agencies.
If you think education is expensive, try ignorance. – Derek Bok, former President of Harvard University
The Threats to North Carolina’s Public Education System
North Carolina’s public education crisis has many causes and symptoms. We will describe these ills, and how they threaten the future of the public education system in the next several essays. The threats outlined in this essay involve the state’s inadequate investments in public schools, childcare and early childhood education.
1. Defunding the Public Education System.
The NCGA has turned its back on public school funding. NCGA leaders may boast that, from 2011-12 to 2021-22, they increased per-pupil state spending an average of 3 percent per year. However, when adjusted for inflation, state funding for public schools declined[i]. The NCGA has even diluted its long-standing commitment to supporting local capital financing efforts.
North Carolina also spends less per pupil than most other states. The Education Law Center ranked the state 48th(and graded it F) for overall funding[ii]. The National Education Association ranked it 41st for per-pupil public school expenditures for 2020-21. In 2021, North Carolina received a D+ grade for school finance from the Education Week Research Center[iii]. North Carolina has the highest share of students in under-funded districts (92 percent)[iv].
North Carolina’s investment in public education also appears dismal relative to its economy (total education spending relative to GDP). This has been documented by reputable organizations such as the Education Law Center. The Albert Shanker Institute, in its 2020 report on public school financing, found that North Carolina—and some other states—possess sufficient resources but exhibit relatively low effort to improve “their subpar funding.”[v]
Another indicator of the NCGA’s aversion to fully funding public education is its stubborn defiance of judicial funding mandates. In 2022, the state supreme court ordered the state to increase school funding and the Leandro parties agreed to a comprehensive settlement plan. This plan called for an investment of $4.5 billion more per year in public education funds by 2028. The NCGA’s cynical gambit is evidently to defy the Leandro plan until the new state supreme court majority overturns it.
The NCGA’s approach to the biennial budget process exemplifies its disinterest in public education. Despite absolute control of both chambers and a healthy budget surplus ($4.8 billion surplus), the NCGA failed to approve a budget by the fiscal year start[vi]. This forced LEA employees to start the school year without promised pay raises and LEAs to fill unexpected vacancies. At the same time, the NCGA seems all too willing to make a long-term funding commitment to the ineptly designed OS program.
2. The Inequitable Distribution of Public Education Funds.
North Carolina, like most states, does try to distribute federal and state education dollars in ways that reduce funding inequities among LEAs. However, the state’s current distribution scheme falls short in its treatment of three types of districts—low-income, small and public-school districts.
Low-income districts present a huge challenge. Low-income district per-pupil costs tend to be higher. And the inherent inequities of the local property tax—the primary local funding source—penalize poorer districts. Allotments can help mitigate some disparities, but they are less effective when underfunded, inflexible and frequently changed.
North Carolina, according to the Education Law Center, has a modestly progressive distribution scheme[vii] with a five percent boost for low-income districts. States with more progressive distribution schemes like Alaska and Utah spend at least 50 percent more on supplements for poor districts. In 2021, North Carolina received a D+ grade for school finance (spending and equity) from the Education Week Research Center (Quality Counts).
Small, rural districts present another challenge, one that receives too little attention[viii]. According to the NCGA’s Fiscal Research Division, 43 of the state’s 115 LEAs have less than 4,000 students. Small districts are more vulnerable to funding cuts (their marginal costs skew higher than those of larger districts). Some small districts are hurt by regional cost disparities. Some have had to ask their counties to fund more public education costs. Some could be adversely impacted by the DPI’s proposed new funding model. And too many small districts maintain inadequate fund balances[ix].
Finally, the NCGA has displayed a mystifying bias for private schools—and against public schools—in its policy and funding decisions. For instance, it allocated $500,000 annually to the OS program to market vouchers but made no such allocation to public schools. Worse, the NCGA plans to allocate $500 million per year in public funds to private schools without the same standards that apply to public schools.
3. Failing to Adequately Prepare Children for Kindergarten.
Too many children enter our public schools with minimal academic preparation. This poses a burden on public schools that won’t be overcome for years, if ever. The ramifications for our public education system are bad enough, but they’re just as grave for our workers and citizens.
The state has access to some early childhood education programs, such as NC Smart Start and NC Pre-K, and federal programs like IDEA Part B 619 (Preschool Exceptional Children's) and Head Start. At one time, with bipartisan support, the state’s investment in Smart Start and NC Pre-K began to yield meaningful achievement and equity improvements in public K-12 schools.
However, as the state programs have encountered funding issues, they have struggled to meet demands[x]. NC Pre-K, for example, only serves about half of eligible children—and about 20 percent of all four-year-old’s[xi]. The NCGA seems unlikely to significantly increase funding for the current state programs[xii], let alone a more comprehensive childcare and early childhood education program. In addition, some counties have declined some early childhood funding[xiii]. Failing to adequately fund childcare represents a lost opportunity, for public schools and our children.
According to a 2019 Bipartisan Policy Center report, North Carolina has a more significant gap between its childcare needs and supply than most states. It has 459,500 children aged 0-5 with available parents in the workforce, but only 194,000 state-recognized childcare slots, a 58 percent gap. The average gap for 25 states reporting data is only 32 percent. North Carolina’s childcare gap is about four points higher for rural areas than urban areas.
The Annie E. Casey Foundation (Kids Count Data Center) has estimated that about 58 percent of the state’s children aged 3-4 are not enrolled in some type of preschool, slightly more than the US average.
Care.com, an online marketplace for childcare, ranks North Carolina 25th for its aggregate cost, quality and availability score. A more comprehensive analysis by Child Care Aware from 2013 ranked North Carolina for 42nd for program quality (but 2nd for oversight).
The state’s childcare crisis and its ramifications are well understood. According to a recent North Carolina Chamber Foundation survey, over 80 percent of the state’s voters see childcare as a problem and support the use of taxes to improve childcare quality and affordability. The NCGA’s neglect of this issue will spur childcare center cutbacks and exacerbate worker shortages. Ultimately, our failure to build a universal public childcare system will damage our state’s economy and our children's future.
In our next essay, we will address more threats to North Carolina’s public education system. We will focus on emerging challenges to the learning environment and instruction methods.