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Relating School District Resource Needs and Capacities to Chapter 1 Allocations: Implications for More Effective Service Targeting

The purpose of this paper is to provide the most recent national information available on the relationship between school district poverty, local fiscal needs and capacities, and Chapter 1 allocation levels. Two central questions will be addressed. First, what is the relationship between a school district’s poverty rate (the primary basis for Chapter I allocations) and its local revenue raising capability? Second, how are Chapter 1 funds allocated among districts with different poverty rates, fiscal capacities, and local revenue bases? Following a presentation of findings related to these questions will be a discussion of some of their implications with regard to targeting federal compensatory aid to the “right” school districts, schools and students.