K12 Records Resources

May 31, 2024

Funding Alternatives for School Districts: Navigating the End of ESSER

In the realm of public education, funding is a perennial topic of discussion and concern. School districts face the ongoing challenge of securing adequate resources to provide a quality education while managing budget constraints and fiscal uncertainties. With the expiration of Elementary and Secondary School Emergency Relief (ESSER) funds on the horizon, school districts are now faced with a new set of challenges. How can they maintain their programs and support staff without the supplementary funds they have relied on? This blog post explores various funding alternatives for school districts, providing insights into how they can navigate financial challenges in the post-ESSER era.


How School Districts Are Funded

Before diving into alternative funding options, it’s essential to understand the traditional sources of school district funding. Public school districts in the United States generally receive funding from three primary sources:

  1. Local Funding: Local funding, typically derived from property taxes, constitutes a significant portion of school district budgets. The wealth of a community directly impacts the amount of funding a school district receives, leading to disparities between affluent and less affluent areas.
  2. State Funding: State governments allocate funds to school districts based on various formulas that consider factors such as student enrollment, district size, and specific needs. These funds aim to provide a more equitable distribution of resources across districts.
  3. Federal Funding: Federal funds account for a smaller percentage of overall school funding but are crucial in supporting specific programs and initiatives. Title I funding for disadvantaged students and Individuals with Disabilities Education Act (IDEA) funds for special education are notable examples.
  4. Grants and Donations: Schools often seek grants from federal, state, and private sources to fund specific projects or programs. Philanthropic donations can also play a role, albeit typically on a smaller scale.

    How School District Funding Is Allocated

Once funding is secured, school districts must allocate resources to meet various needs:

  1. Operational Costs: Paying for salaries, utilities, maintenance, and administrative expenses.
  2. Instructional Costs: Covering teacher salaries, classroom supplies, curriculum development, and technology.
  3. Special Programs: Funding for extracurricular activities, special education, English language learner programs, and gifted education.
  4. Capital Projects: Investing in infrastructure improvements, new school construction, and major renovations.

How ESSER Impacted School District Funding

The ESSER fund, part of the CARES Act, provided substantial relief to school districts during the COVID-19 pandemic. These funds helped districts address immediate needs such as:

  1. Remote Learning: Investing in technology and internet access to support remote instruction.
  2. Health and Safety: Implementing health protocols, purchasing personal protective equipment (PPE), and upgrading ventilation systems.
  3. Learning Loss: Launching programs to address learning gaps exacerbated by the pandemic.


What School Districts Are Doing Now That ESSER Is Ending

With ESSER funds set to expire, districts are bracing for a "fiscal cliff." Many are already experiencing increased job cuts and layoffs as they adjust to the impending loss of funding. According to an article by District Administration, job cuts are mounting ahead of the summer.
School administrators must now explore alternative funding options to sustain their operations and programs. Here are some strategies they are considering:


Alternative Funding Options for School Districts

  1. Education Grants
    Federal Grants: Programs like Title I and IDEA continue to provide essential funding. Additionally, the Department of Education offers competitive grants for specific initiatives, such as the Teacher Incentive Fund and the 21st Century Community Learning Centers program.
    State Grants: Many states offer grants for innovative programs, technology integration, and professional development.
    Private Grants: Foundations and corporations often provide grants to support education initiatives. Examples include the Bill & Melinda Gates Foundation and the Walton Family Foundation.
  2. Partnerships and Sponsorships
    Local Businesses: Partnering with local businesses can lead to sponsorships, donations, and in-kind support for schools. Businesses may fund specific programs or provide resources such as technology and supplies.
    Higher Education Institutions: Collaborations with colleges and universities can bring additional resources, expertise, and opportunities for students and teachers.
  3. Fundraising and Donations
    Community Fundraising: Engaging the community through events, crowdfunding campaigns, and booster clubs can raise significant funds. Schools can organize charity runs, galas, auctions, and other events to garner support.
    Alumni Donations: Reaching out to alumni networks can result in substantial donations. Alumni who have benefited from their education often wish to give back and support future generations.
  4. Leveraging Technology
    EdTech Solutions: Investing in educational technology can improve efficiency and reduce costs. For instance, adopting learning management systems (LMS) and digital resources can streamline administrative tasks and enhance instruction. Administrative technology has helped districts reallocate staff resources, save money, and even generate revenue.
    Online Learning Platforms: Offering online courses and programs can attract tuition-paying students from outside the district, generating additional revenue.
  5. Optimizing Budgets
    Cost-Saving Measures: Conducting thorough audits to identify areas where costs can be reduced without compromising quality. This might include renegotiating vendor contracts, optimizing energy usage, and consolidating services.
    Shared Services: Collaborating with neighboring districts to share services such as transportation, maintenance, and administrative functions can lead to significant savings.
  6. Exploring New Revenue Streams
    Facility Rentals: Renting out school facilities for community events, sports leagues, and private functions can generate additional income.
    Advertising Opportunities: Schools can explore advertising opportunities, such as digital signage and sponsorship banners, to create new revenue streams.
    Revenue Generation Opportunities: There may be hidden opportunities for school districts to generate their own revenue streams. For example, districts across the country have started charging alumni or third-party organizations like employment verification companies for the fulfillment of records requests. These small charges can quickly add up, earning districts hundreds if not tens of thousands of dollars each month.


    As the ESSER funding era comes to an end, school systems must navigate the transition with strategic planning and innovative solutions. By exploring alternative funding options, school administrators can mitigate the impact of the fiscal cliff and continue to provide high-quality education to their students.

    For those looking to delve deeper into funding strategies, administrative cost savings, and revenue generation opportunities, check out The Hidden Impacts of Paper-based Processes, which includes an audit template for K-12 district staff to complete. Together, we can ensure that our schools are well-equipped to face the challenges ahead and thrive in the years to come.