The formula used to allocate federal funding for state and local special education programs is one of the Individual with Disabilities Act’s most critical components. The formula not only serves as the primary mechanism for dividing available federal dollars among states, it also represents policymakers’ intent to equalize educational opportunities for students with disabilities nationwide. In this study, we evaluate the distribution of IDEA Part B(611) funding in the wake of changes to the formula that were instituted at the law’s 1997 reauthorization. We find that the revised formula generated large and concerning disparities among states in federal special education dollars. We find that, on average, states with proportionally larger populations of children and children living in poverty, children identified for special education, and non-White and Black children receive fewer federal dollars, both per pupil and per student receiving special education. We present policy simulations that illustrate how changes to the existing formula might improve the fairness and efficiency with which federal IDEA Part B funding is allocated to states.
special education, school finance
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