Public School Financing and the Issue of Inequality
No discussion of equal educational opportunity would be complete without reference to methods of public school financing. It will be recalled that the earliest state education laws delegated to local communities the responsibility for providing free public education. 1 For local communities, property taxes provided the most feasible mean of raising the revenues necessary to finance public schools. Traditionally, therefore, property taxes have provided the primary source of funding for public education.
This traditional American means of financing public education did not result from any one calculated legislative policy or scheme. Rather it evolved naturally from the complex federalist structure of government, and the reservation of local and state powers envisioned by the constitutional framers and enshrined in the Tenth Amendment of the Constitution. 2
Nevertheless, by the mid- 1970s it had become apparent that school financing systems based on local property taxes resulted in inequalities between school districts in per capita educational expenditures. Since actual property tax revenues depend not only on the rate of taxation, but also on the underlying valuation of the property taxed, many property-rich school districts can provide higher per capita educational expenditures with lower property tax rates than many poorer districts can provide with higher tax rates. For this reason disparities in per pupil expenditures between school districts within a state exist in most states. In 1989, for example, per pupil expenditures in the Chicago area varied from $9,371 in Niles Township to $5,265; 3 in New York disparities ranged from $11,372 to $5,885; 4 and in New Jersey from $7,725 to $3,538. 5
Because of such disparities, there has been a temptation to simplistically apply concepts of equal protection to strike down school financing systems in which per pupil expenditures are based on the wealth of the school district. As early as 1971, for example, the California Supreme Court in Serrano v. Priest6 held that education was a fundamentally protected right and that a financing system that made