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State conversations about school system redistricting have become more common in the United States, especially in Pennsylvania, where lawmakers have been discussing the idea for nearly two decades. The state’s 1.5 million public school students are spread among 500 different school districts. These range in size from over 118,000 students in Philadelphia to fewer than 150 in the rural Austin Area School District. There are 112 districts that enroll under 1,000 students.¹ Most of the boundaries between districts were drawn many decades ago, often in ways that separate students by race and income. The profusion of small districts creates extra administrative expenses, and the state’s heavy reliance on local taxes to fund public education leaves many schools cash-poor.

In 2007, the state legislature’s Budget and Finance Committee ordered a study of district consolidation that found the potential for cost savings.² In 2009, Governor Ed Rendell took up the cause and proposed cutting the state’s 500-some school districts down to 100, putting it on par with states like North Carolina.³ A legislator proposed a bill in 2010 that would have replaced existing school systems with county-based school districts.⁴ A House Republican sought to create a $100 million School District Consolidation Incentive Fund in 2015,⁵ and a Senate Democrat tried to legislate both financial aid and state planning support for mergers in 2023.⁶ Today, a state representative is again proposing that Pennsylvania reduce the district count through consolidation.⁷ But time after time, these efforts have failed.

Changing political boundaries is never easy, but Pennsylvania has fallen short in part because lawmakers have defined their case too narrowly, focusing only on efficiencies from school district consolidation and greater economies of scale. They have ignored two other potential benefits from school district boundary change: greater fiscal equity between school districts, and reduced racial and economic segregation. These are stubborn problems in American public schools—not just in Pennsylvania, but across the country.⁸ And they are closely connected. Both have to do with where Americans of different races and incomes live, and why.

Decades of American housing policy have resulted in deep residential segregation and prevented people of color, in particular, from building wealth in their homes.⁹ In the twentieth century, this included openly race-based policies that made it effectively impossible for homebuyers of certain ethnicities to secure mortgages in many areas and reserved certain housing for White families. Today, it manifests in subtler forms of discrimination, like zoning rules that effectively close towns or communities to the construction of affordable housing. These policies, past and present, have produced a residential landscape that is highly segregated by race and class. Because nearly all public-school students attend school in the district in which they live, and school district boundaries are frequently drawn along existing racial and residential fault lines, segregation between neighborhoods also means segregation between school systems.

Unfair housing policy shows up in schools in another way: unequal district budgets. Much of the disparity in school funding between school districts comes from differences in local property tax bases. The average school district in the United States received 43.5 percent of its revenue from local sources in 2023, and the majority of that—27.1 percent of the total—came from local property taxes.¹⁰ School district funding amounts are therefore directly tied to local property wealth levels. Higher property values mean a district will be able to raise ample revenue for schools easily, at lower tax rates. As a result, big funding gaps are often related to significant disparities in the property tax base. Because property-poor districts struggle to collect enough local revenue for schools, they are at a disadvantage in everything from attracting the best teachers to building and maintaining modern school buildings. And since property values are shaped by many years of racialized housing policy, it is not only high-poverty districts that often deal with low tax capacity; it is also districts that serve many students of color.

This ground-level school finance inequality, with its troubling racial dimension, is an injustice to students. To state lawmakers, it is also a budget problem. States have constitutional obligations to provide students with a fairly and adequately funded public education.¹¹ Local property taxes just aren’t sufficient to support that education in most school districts. So, states spend billions of dollars on K–12 education each year, compensating for local funding inequality by providing greater amounts of state aid to districts with less property wealth. This is the reason that only slightly less than half of school funding comes from local sources in the average school district. A similar proportion comes from state aid, though this share is generally lower in property-wealthy districts and higher in property-poor districts.¹² In nearly every state, however, school finance policy allows plenty of room for high-wealth districts to counteract this progressive aid with additional local tax revenue for their own schools, overwhelming state efforts. This makes it an ever-increasing task for states to achieve resource equity just through compensatory aid.

The job will only get harder over the next few years. Districts, still not fully recovered from the COVID-19 pandemic and its massive academic disruptions, are currently dealing with the expiration of their final federal pandemic relief funds.¹³ State budgets are newly threatened by severe cuts to federal safety net programs; slashed federal funding for health care and food assistance will leave states squeezed, as they will need to meet new costs with less revenue.¹⁴ Since public education spending looms so large in state budgets, it is unlikely that K–12 schools will be spared in the financial crunch. And state education aid cuts are likely to hit low-wealth districts hardest. Because state funding policies are set up so that property-poor districts receive more of their funding from the state, across-the-board state cuts affect their budgets the most. (Multiple studies of Great Recession education cuts show exactly that.¹⁵) This puts the burden on school systems with smaller tax bases and asks them to jack up property taxes to make up the loss. But the last few years have already seen substantial property tax increases for the average American homeowner.¹⁶ Something has to give.

School redistricting is a solution for all of these problems. If states draw district boundaries with the goals of encompassing more diverse student populations and more equal amounts of property wealth per pupil, then the system will be fairer at the ground level. States will be better able to provide an equally resourced education to all their students, without making individual districts disproportionately dependent on state aid.

With this report, we show how. Drawing on machine-learning methods often used for legislative redistricting, we simulated three options for new school system boundaries and measured their impact on segregation and tax-base equity. We offer a first-of-its-kind displaying states’ current school district maps and better alternatives, showing how specific redistricting choices can create a fairer school system for our children.

The gains from these changes would be enormous. The average state analyzed showed a potential 66.6 percent increase in the equality of per-pupil tax base between districts, as well as a 47.6 percent reduction in racial segregation and a 65.0 percent decrease in economic segregation between districts. All of this can be achieved without changing anything about property values or where families live—just by redrawing the imaginary lines that separate students from resources, and from each other.