Although the new K-12 education funding formula that Nevada adopted five years ago significantly overhauled how state money flows down to public schools, school funding is still well below what experts think is needed to ensure good outcomes, according to a new report unveiled Wednesday by the Guinn Center, a policy-focused nonprofit research group.

Anna Colquitt, the center’s director of education policy, noted during a Wednesday webinar that while the Legislature approved a historic $2.6 billion increase for K-12 education during the 2023 legislative session, Nevada’s average per-pupil allocation, about $13,000, still trails the national average by about $4,000. Augenblick, Palaich and Associates, a consulting firm that specializes in school finances, recommends a funding amount of more $17,000 per student to ensure adequate education outcomes, she said. 

“So this $4,000 gap between Nevada's per-pupil spending amount and the expert recommendation signals a critical underfunding of our students, particularly in a time when education is one of the most powerful investments that we can make for our state's future,” Colquitt said during the webinar.

It's a finding that echoes what the original bill sponsor said during the formula's development -- that the overhaul would not grow the size of the funding pie, but would change how the pie is sliced.

Ensuring schools have the adequate amount of funding has become even more important after the pandemic, which exacerbates students’ needs and issues such as chronic absenteeism, she added during a Thursday interview with The Nevada Independent. 

In 2019, state lawmakers passed a bill, SB543, that replaced the state’s school funding formula, the Nevada Plan, and shifted to the Pupil-Centered Funding Plan (PCFP). It was the first major overhaul of the funding formula since 1967. 

The Nevada Department of Education commissioned the Guinn Center in 2023 to do an independent evaluation of the formula. The organization released its 84-page analysis three months before lawmakers will convene to work on the state's two-year budget.

One of the aims of the new formula was to provide more transparency in how the state funds public schools by sweeping more than 80 different funding streams into one giant education funding pot. 

The new formula also accounted for the needs of the state's increasingly diverse student population by creating three categories of students who could receive additional funding, also known as weights: English learners, at-risk students and gifted and talented students. 

In Nevada, more than a fourth of students are allocated weighted funding or special education funding, with the Las Vegas area having the highest concentration of students who receive these additional dollars followed by the Reno-Sparks area, the analysis found.

“We are now identifying these students on a student and school level, which was not really happening before,” Colquitt said in a Thursday interview. “So that's a huge stride because we are able to see, from a statewide perspective, what is our student population, what are the needs of the students, and then how can we target interventions to meet those needs?” 

Though students may qualify for more than one of these categories, they can only get funding for the category that would yield the highest amount of additional dollars. 

Prior to 2024, more than 240,000 students who qualified for free or reduced-price lunch were considered at-risk. But a 2023 bill, SB503, changed the at-risk definition to to refer to students “within the quintile of pupils determined to be most in need of additional services and assistance to graduate based on one or more measures” set by the State Board of Education. This can include students who are economically disadvantaged or are underperforming in school. 

Based on 75 factors, each student is assigned a “grad score” from 50 to 150 of how likely they are to graduate. The score is calculated by an algorithm from Infinite Campus, a student information system used to manage student information from pre-K to graduation. 

The lower the score, the higher the student’s chance of not graduating. The at-risk funding currently applies to students with grad scores of 72 or lower, or the 20th percentile, who are considered as medium to high risk. 

Colquitt said Nevada is the only state that uses Infinite Campus’s grad score to determined funding. 

After the definition changed, the number of at-risk students dropped to about 63,000. The new method for identifying at-risk students and the drop has drawn sharp criticism from school officials who have felt the decrease in their state funding and are concerned about what that will mean for the support they are able to offer students in need. Education advocates are also calling for more transparency in how each factor is weighed to calculate a student’s grad score. 

Though the number of at-risk students has fallen to about a quarter of what it once was, the amount of additional funds schools get under this weight has increased in recent years from about $300 per student to almost $3,000. 

Some principals who were interviewed as part of the report said they weren’t aware of what those 75 factors are and therefore may not be reporting the proper data points in Infinite Campus for it to accurately identify at-risk students, highlighting the need for additional training, the report states. 

Not being able to tell how much weight each of the factors carries also makes it difficult for school leaders to determine what intervention program or resources an at-risk student might need, Colquitt said.

Following the outcry, the State Board of Education and the Commission on School Funding have reviewed the threshold for at-risk funding eligibility, including the grad score, and are working to evaluate its effectiveness. 

Colquitt said there’s also a need for better overall data on how spending decisions are made after the state funds trickle down to districts and schools, to continue to evaluate the new funding model’s effectiveness. 

“In order for anything to be successful, we need to be looking at continual improvement,” she said.