That being said, a number of these districts face higher labor costs, which offsets at least some of that advantage, according to the research from Brookings.

The findings “raise questions about what I see as a predominant narrative that local property tax finance means that poor schools don’t have as much money and that that is a core, structural cause of inequality, and I just think it’s not,” said Sarah Reber, a senior fellow in economic studies at Brookings and the report’s lead author. 

“That doesn’t mean giving poor schools more money wouldn’t help. It could help,” she added, but “if we’re spending all of our time … focused on the level and allocation of school funding, we’re missing other important things.”

To do this work, Reber and her colleagues used data collected by the Census Bureau, which surveys school districts on their spending and enrollment. They then divided districts into five groups, or quintiles, based on poverty rates and racial composition, with the first quintile being the least poor and the fifth being the most and the first quintile having the lowest share of non-white students and the fifth having the most.

They found that spending allocations across these five poverty brackets is U-shaped, with the poorest and wealthiest districts spending the most. Since the early 2000s, the poorest districts have outspent even the wealthiest ones. Part of this U-shape can be explained because states send more money to high-poverty districts, while affluent public schools are more likely to be in wealthier, higher-spending states.

While these findings weren’t necessarily surprising to Reber, she felt it was important to document because there is such a strongly held conviction in the opposite.

Rick Hess, director of education policy studies at the right-leaning think tank American Enterprise Institute, echoed this point and said the Brookings researchers, “deserve credit for taking a careful look at the data and trying to illuminate the real situation on the ground because … many of these conversations can be driven more by narrative than by the stark reality.”

Reber added the caveat that while funding is likely not the prime cause of education inequity, there is still significant causal research that shows when funding is increased it improves outcomes.

“I definitely don’t want to put myself in the ‘money doesn’t matter’ (group), like we shouldn’t care about that at all,” she said. “But I think this idea that people have that obviously the reason that schools that serve poor students are struggling is that they have less money (is) not the case. For one thing they don’t — they have more money.”

Reber also emphasized the importance of the historical lens of the research. She found that patterns in spending by both poverty and racial compositions remained largely consistent in each end of the five decades the authors examined, though there were some changes in the middle years. Beginning in the 1980s and early 1990s, spending was less targeted to higher-needs students, but that shifted back to earlier patterns after 1995. 

The findings that most surprised her, she said, were around racial composition: She was not anticipating that within states, predominantly non-white districts have had more funding than their counterparts throughout the entire five-decade period studied. That being said, because many of these districts are in urban areas, “their purchasing power is not as different as that (level of funding) would make it seem because they’re facing higher wages.”

High-poverty and mostly non-white districts were also disproportionately hit by the Great Recession, since “the federal aid was both not enough for how long the recession shock lasted … and wasn’t really targeted,” said Reber.

“Over the ’90s and 2000s, there had been this increase in state funding that was increasingly targeted to higher-poverty districts,” she added, “so that was part of how you’re getting that increased (levels of directed funding) during that period, but then that made them vulnerable to cuts from state funding during the recession.”

A large body of previous research has looked at differences in spending within states, but in Reber’s work she found, “the differences across states swamp all of this within-state difference that gets so much attention.”

In commenting on these large differences between states, Hess, of AEI, argued, “the real irony is that so much of the progress we’ve been seeing in the last five or seven years is in relatively low-spending states like Mississippi and Louisiana and Tennessee” while “many of the states which spend most expansively have been performing at remarkably low levels. So certainly what matters with money is very much what you do with it.”

In the report, the authors note that their findings might seem to contradict other reports on school funding equity that suggest primarily non-white and high-poverty school districts receive less funding. They point to the widely cited from EdBuild, which found “predominantly white school districts get $23 billion more than their nonwhite peers.”

To explain these discrepancies with the 2019 report in particular, they point to two main differences in methodology: EdBuild adjusted for regional cost-of-living differences and looked at only state and local revenue, whereas Brookings studied total current spending — including from federal revenue, which disproportionately benefits largely non-white districts. 

The single biggest allocation of federal funding for K-12 schools is Title I, which this year sent in additional money to schools with high concentrations of low-income students.

Rebecca Sibilia, who was the CEO of EdBuild at the time the report was released, acknowledged the decision to leave out federal funding streams was somewhat “controversial,” but argued it was the right call given their research question and organization were specifically focused on state funding formulas.

“The state dictates how much money school districts will receive from the state, and also what the tax policy is for how much you can raise from local taxes,” said Sibilia, who is now the executive director of EdFund, a national education research and advocacy nonprofit. “And so our critical concern was, ‘Are these funding formulas working for kids who need the resources most?’”

Ultimately, the differences “just highlight that there are different ways to accurately measure whether or not kids are getting their fair share,” Sibilia added, emphasizing that Reber’s differing methodology made sense to determine which districts get the most money overall.

Reber emphasized that her work was not meant to make any argument against poorer districts receiving more money, but rather just to document the phenomenon. She also argued it’s equally important to be thinking about how schools can be using their money better.

“Obviously, there’s places that are spending much less and not really getting demonstrably worse outcomes,” she said. “I think it’s important to try and learn from that and try to figure out what the barriers to being more productive with spending are.”

Nearly half of those surveyed reported leaving their jobs to provide child care, 80% experienced food insecurity and just over half worried that their child was missing out on care that is safer or more welcoming. This was especially true for kids with disabilities.

The research is particularly relevant given the federal government’s recent attempt to freeze $10 billion in social service funds to five Democratic-led states, including at least $2.4 billion in child care subsidy funding.

Daphna Bassok, the report’s author and an education and public policy professor at the University of Virginia, said if the funding to the five states were to disappear overnight, the impacts would be “pretty dire” and quickly felt.

“The findings highlighted just how meaningful these resources are for families. This is not help around the edges or help just to make things a little better,” she said. “The results suggest they are driving families’ abilities to work and go to school and do basic things, as well as children’s ability to go to child care centers.”

On Jan. 6, the Department of Health and Human Services announced it was halting billions in child care and family assistance funds to California, Colorado, Illinois, Minnesota and New York, alleging “serious concerns about widespread fraud and misuse of taxpayer dollars in state-administered programs.”

Within days, the attorneys general for all five states claiming the move was “cruel,” unconstitutional and would lead to immediate and devastating impacts. A federal judge has since issued two , halting the freeze through Feb. 6. 

Three key programs serving particularly vulnerable children and their families hang in the balance: the Child Care and Development Fund ($2.4 billion), the Temporary Assistance for Needy Families ($7.35 billion) and the Social Services Block Grant ($869 million).

The Child Care and Development Fund is the main federal grant program allowing states to assist low-income working families with child care, and even before the attempted freeze the need was greater than what the dollars were able to support, according to Julie Kashen, the director of Women’s Economic Justice at The Century Foundation. 

“It is a program that has long been starved,” she said.

The move by HHS to cut off funds to the five states followed a conservative YouTube personality alleging widespread fraud in child care centers in Minnesota. A from 2019 did find significant weaknesses in anti-fraud controls, vulnerabilities that were addressed by and . Separate and highly publicized instances of substantial fraud in a Minnesota child nutrition program during the pandemic have since led to dozens of . The more recent allegations made via viral video have so far proven to be

Some 12.5 million children are eligible for the subsidies based on federal guidelines, yet only about 2 million received them in 2019, covering just 16%, according to a 2023 Between July 2024 and May 2025 in Virginia alone, almost 19,000 families who applied for a subsidy were placed on a waitlist.

Brookings researchers collaborated with the Virginia Department of Education to survey these families. They received responses from 6,548 (35%) of them between August and September of 2025, making it one of the largest studies to date looking at the experiences of eligible families missing out on subsidies. At the time of the survey, 67% of respondents were still awaiting the benefits, while 33% had made it off the waitlist and were receiving funds.

The vast majority of surveyed families still on the waitlist reported significant impacts to their employment as a result, with 76% saying they worked less than desired, 71% saying they turned down additional work or a promotion and 64% saying they reduced work or school hours to provide care. Nearly half had left their jobs altogether.

In open responses, parents described the financial bind they were in: each needed child care to work but, without subsidies, also needed work to afford child care.

“So many of these families felt trapped in this cycle,” said Bassok.

One parent wrote: “I feel like I can’t commit to any plans or ideas about the future months or year until I know if my daughter can go to daycare because we simply cannot afford the rates without subsidy.”

This challenging loop could be exacerbated if HHS is allowed to proceed: The Century Foundation has that if child care providers in the five states are forced to shutter because of withheld federal subsidies, it could impact more than 500,000 children, cost more than $400 million annually in lost parental earnings and could drive 156,000 moms of young children out of the workforce.

It’s not clear what will happen once the temporary halt lifts on Friday; the judge is currently considering a request for a temporary injunction, which would secure the funding while the underlying case is litigated.

For now, the families who eventually made it off the waitlist in Virginia are faring significantly better: nearly two-thirds reported they were able to increase work or school hours, start a new job, or accept a promotion or new position as a result. In all, those still awaiting funds were twice as likely to remain unemployed as those who received them, a difference Bassok described as “massive.”

Those still on the waitlist were also 11 percentage points more likely to experience food insecurity (80% vs. 69%); 15 percentage points more likely to frequently worry about running out of money before getting paid again (51% vs. 36%); nearly twice as likely to have bills that are often past due (31% vs. 18%); and 10 percentage points more likely to buy things with credit, hoping to have the funds later (25% vs. 15%). 

Half of families awaiting support said they were unable to find any care for their kids — including with relatives or friends — and the vast majority (69%) worried their children were missing out on care that could better support their learning and development. That percentage plummeted to 21% for the families that eventually made it off the waitlist.

These concerns were particularly pronounced for parents of kids with diagnosed or suspected learning disabilities and delays, according to Bassok, who described this as an “intense and common theme in the responses.”

Families were “really worrying about what the wait for a child care center was doing for their kids at a critical moment in their development,” she said.

“My son is turning 2 years old and is not yet talking or interacting with other children,” wrote one parent. “Without access to affordable, quality care, he is missing vital opportunities for socialization and early learning that could support his development.”

Another argued her daughter’s delays were a direct result of low-quality care: “She is just being ‘watched’ and not taught much. She doesn’t say many words and I have to put her in speech therapy. … I didn’t have enough money to pay for the day care center that teaches babies.”

These concerns extended to physical safety as well: parents struggling to afford care were less likely to rely on regulated child care centers and more likely to turn to options they didn’t trust.

“The wait for assistance has forced us to rely on unlicensed home daycares out of desperation,” wrote another parent, “which comes with safety concerns and constant instability.”

On the flip side, parents of kids with disabilities who did have access to the subsidy reported an ability to access high-quality care. One wrote, “[Receiving a subsidy] has meant that my son, who has high functioning autism, can attend a safe school where he can get incredible care and since starting there he has been thriving.”

Bassok argued that the Brookings report demonstrates a growing need for more of the exact resources the federal government is trying to strip away. 

“Aside from this moment of what’s happening nationally around these cuts,” she said, “the real takeaway is around needed expansions in federal and state dollars to meet these demands for kids.”