Reopening schools has been expensive. Making up for student learning losses may be worse.

Superintendent Chad Gestson has been spending a lot of money lately.

He has had to buy personal protective equipment for staff and laptops for about 28,000 teenagers. He also has had to keep his schools open for a small number of students with disabilities and extra needs, as well as continue social services like food assistance for families during a pandemic.

“We’re living in the most costly, expensive times that I’ve lived through as superintendent,” said Gestson, who has been in that job since 2015 and runs the Phoenix Union High School District in Arizona, which has 22 high schools. 

The vast majority of teaching has been remote since last March. Gestson said the district has been spending less in overtime costs because it is not running sports and clubs after school, but virtually every other area of spending has been the same or higher. Technology costs have been the greatest, but PPE and safety expenses have played a part as well.

“Even though people think school systems are closed, we’re still providing all the services that we do during a typical school year,” Gestson said.

Phoenix Union received about $12 million from the first coronavirus stimulus bill, according to Gestson.

“That sounds like a lot of money, but if you think about buying a laptop for nearly 30,000 teenagers ... that, in and of itself, is your entire stimulus money,” he said. “That leaves no money left over for Wi-Fi, no money left over for PPE, no money left over for all the other expenses.”

When the coronavirus hit the U.S. last spring, public schools across the country were forced to grapple with how best to educate their students while still protecting lives. For districts that stayed open, that meant buying PPE, investing in new cleaning methods and updating building ventilation systems. For those that closed buildings or turned to a hybrid of in-person and remote learning, it meant buying one-to-one remote learning technology so every student had a laptop or learning device. But that initial financial hit was just the beginning, according to some education experts.

The long-term costs of making up for learning losses over the next few years are expected to far exceed the expenses that schools have already incurred. Experts – and history – suggest school districts need much more than what federal and state governments have provided so far.

White students could lose four to eight months of learning by June 2021, and students of color could lose six to 12 months, according to a McKinsey & Company report published in December.

Making up for those kinds of learning losses, as well as increasing necessary social-emotional support for students, could cost $12,000 to $13,500 per pupil in some districts over the next five years, according to Education Resource Strategies. ERS, a nonprofit that assists school districts, analyzed large urban school systems as well as “countywide” systems that are a mix of urban and suburban to arrive at its estimates. Those districts included a significant number of students of color, students from low-income families, and students with additional learning needs.

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And while school districts grapple with current and future costs, most states are simultaneously likely to collect fewer tax dollars because of COVID-19’s effect on the economy.

“K-12 schools are, in the majority of states, the largest portion of a state budget,” said Victoria Jackson, a senior policy analyst at the Center on Budget and Policy Priorities, a research institute. “Any decline in revenues for state and local government is going to be a huge hit to K-12 schools.”

The federal government has provided two major stimulus packages. The first, passed last March, provided about $13.2 billion for K-12 education. In December, another gave about $54 billion to public schools. But those were one-time payments to cover what will likely be recurring costs.

As schools eagerly await a new stimulus package from the Biden administration, education researchers warn that the schools serving the most vulnerable students will likely bear the brunt of that financial pain unless the federal government delivers and states make thoughtful cuts in school spending. 

Making smart cuts

Money from the stimulus bill passed in December has not arrived yet, but Gestson plans to use the expected $40 million to try to make up for learning losses that his students have suffered.

Phoenix Union is planning the most robust summer school it has ever had, offering more evening school to students who have fallen behind and rewriting the curriculum for next year. 

“All that is extremely expensive – and on top of that, all the PPE required to bring people back,” Gestson said. “This anticipated next stimulus package is going to be vital."

Schools in the U.S. are generally funded through a combination of state and local dollars, with some limited federal money. But there is no uniform national formula, and each state funds its schools in a different way.

In most places, state governments try to compensate for the fact that some school districts struggle to raise money locally.

For example, Phoenix Union is primarily funded through a state-based formula, with the opportunity for local bonds and overrides (tax levies), and some federal dollars.

About two-thirds of the district’s funding comes from the state. That means the majority of its budget is affected by how much Arizona is able to collect in property, sales and income tax.

Taxes that make up state spending are generally more volatile than local tax revenue, according to Rebecca Sibilia, the former CEO of EdBuild, a nonprofit think tank focused on school funding that closed in June of last year. Income, sales and energy taxes are most at risk.

“About half of all of the money in our education system is kind of in a pretty stable position,” Sibilia said. “And then half of the money that's in our education system, that's kind of way up in flux, and it depends on the state.” 

Experts say it’s not only the likely cuts to education but the way states make those cuts that will be crucial for the most vulnerable American students.

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Some states, like Ohio, that announced targeted expected cuts last year, tried to take less money away from schools operating in the lowest-wealth districts and took more from wealthier school districts that could raise more money locally. (Ohio Gov. Mike DeWine has since announced the reversal of some of those cuts.) If a different state makes a flat cut across all school districts, that will disproportionately affect schools that are less able to raise money locally and that rely on a higher percentage of state money. Across-the-board cuts particularly affect students of color, students from low-income backgrounds, and students from communities that have already been hit hardest by the pandemic. 

“The communities that need the most will face the biggest hits,” said Zahava Stadler, special assistant for state funding and policy at The Education Trust, a nonprofit education research and advocacy organization. “If the state has to cut, and if it doesn't cut very carefully, the default situation is that those cuts are going to fall heaviest on high-need communities, on districts that have the least ability to make up those dollars locally.”

Juggling budgets

Patrick Miller is superintendent of Greene County Schools, a district in North Carolina that he describes as “poor and rural by every definition.” It has a little more than 2,700 students in K-12 and another 160 or so in pre-K, spread out over six schools.

The district started transitioning to remote learning last March. Miller got masks from the state but spent money on other types of PPE, including gowns, thermometers, face shields and disinfectant. Since opening schools on Aug. 17, the district is rotating students on a one-week-in-person, one-week-remote schedule.

Miller’s budget for the 2019-20 school year was about $35 million, and Greene County Schools received $1.4 million from the first coronavirus stimulus package. The district spent about $700,000 increasing its one-to-one remote learning technology for students and on tech assistance, with an additional expenditure of about $100,000 on PPE.

“We would have gone belly-up without that money,” Miller said.

He still does not know how much Greene County Schools will receive from the December stimulus package but believes it’s important “because everyone's unsure what the state budget picture is going to look like.” With the December money, Miller plans to finish transitioning remaining students to one-to-one technology, then hold on to the rest of the money until he knows what the state will do.

“I've got a feeling there may be a chance that the (North Carolina) General Assembly would look at the federal relief money as an opportunity to backfill some holes and just let that money supplant some of what they may have given us,” Miller said.

Stimulus money has been crucial to keeping schools operating and transitioning to remote learning. But it won’t last forever, and there is a danger that states will use it to replace their own spending, and that schools will use one-off stimulus money as a long-term solution.

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That’s what some states did in 2008. When federal money dried up a few years later, school budgets fell off a cliff. Although the contours of that budget crisis were different, the ghost of the 2008 financial crisis looms large over this one. When COVID-19 hit, some states were just beginning to catch up to where their pre-2008 spending had been, adjusted for inflation, according to several education experts. And many schools never recovered.

“There were a number of districts last time around that invested nonrecurring funds in recurring costs, and as a result of that, experienced some real challenges once that federal money went away,” said Jonathan Travers, a partner at ERS. “They didn't try to change underlying cost structures; they just added to what they were doing.”

The effect of COVID-19 could be even more dramatic than that of 2008 without serious and sustained federal intervention. During the Great Recession, state funding declined 6% in 2010, according to an analysis by Tyton Partners, a consulting firm. In terms of COVID-19’s impact, Tyton estimates that if there had been no federal stimulus to date, there would be a state budget decline of 5% in fiscal year 2021 and 13% in fiscal year 2022.

Seeking systemic fix

Schools right now are experiencing what Sibilia calls the “double squeeze”: facing the costs of getting kids back to school and making up for learning losses at the same time most states probably will cut their funding.

Biden’s proposed stimulus package, if it’s passed by Congress, would give about $130 billion to K-12 schools to help them reopen, make up for learning losses and stay viable over the next few years.

For some education experts, there is no single number in a dream stimulus plan that could cover what needs to happen in public education during and after the pandemic. Instead, they said, the pandemic should be a catalyst for changing the way states raise money for education. As it stands, schools in low-income neighborhoods serving students from vulnerable populations are still at the mercy of changing winds in state funding. 

Stadler envisions this time as a call to action for states to be careful with where they make cuts, prioritize education of underserved students first and foremost, look for new sources of funding, and think long-term. That could include refining the state sales tax to ensure it includes services used mostly by people with high incomes, implementing a state estate tax, or pooling property tax dollars for education at the county or state level so that high-income communities can share wealth.

For instance, Arizona passed Proposition 208 in November to put a 3.5% income tax surcharge on people making more than $250,000 a year, which would raise hundreds of millions to support K-12 education. That money is designated for teachers and classroom support staff, mentoring and retention programs, and the Arizona Teachers Academy, which gives financial support to people earning their teaching certificates in exchange for a commitment to teach in the state. 

Gestson doesn’t have a specific amount he believes his district will need to overcome the crisis. “After the economy crashed in the Great Recession, the stimulus package total for schools was closer to $100 billion. And so, when we think about the amount of money and resources needed to navigate a state and federal economic crisis, the first (COVID-19) package was not nearly enough,” he said. “The second one gets us closer. But we also don’t think it's enough long term.”

The next stimulus will bring the amount spent to help schools to nearly $200 billion. But no specific amount will be enough to help the children who need it most without changes to how states fund schools, Sibilia said.

“Let's figure out the actual systemic fix, so that these low-wealth school districts aren't the ones who consistently have to look at vulnerable revenues, cut their budgets, not know what's coming in the future.”

This story about stimulus funds for schools was produced by The Hechinger Report, a nonprofit, independent news organization focused on inequality and innovation in education. Sign up for Hechinger’s newsletter.