United States PreK-12 Policy and Budget Outlook 2024-2025

The $190 billion in pandemic-era ESSER funding is winding down, but according to the report, federal appropriations and state budgets for PeK-12 education have remained strong during Fiscal Year 2024.

This report determined that the stability is due to the ongoing stimulus funding aimed at addressing the ongoing learning losses from the pandemic lockdowns, alongside robust local and state budgets. In fact, 33 states are on track to up their savings funds which will help prepare for this transition.

The report also identifies and analyzes the major program and curriculum priorities and initiatives taken by federal and state policy makers. Perhaps the most significant of these are the efforts and programs for funding workforce and Career and Technical Education (CTE), a trend that continues to gain momentum. Other areas getting attention and monies include increased investment in PreK-12 education, especially for early literacy programs, and more funding for teacher professional development, with a recent emphasis on providing educations with AI-literacy skills.

What is growth in AI in the classroom driving?

• New legislation
• Professional development

How is AI prompting new legislation?

• The growth of AI in the classroom is prompting new legislation on how the technology may be used and is spurring professional development so teachers can develop AI literacy skills.

How many states are boosting investment in PreK-12 education?

• Over 30 states are boosting investment in PreK-12 education and there is focus on expanding access to preschool and childcare services.

What is the outlook for federal and state funding for PreK-12 education?

• Federal and state funding for PreK-12 education remains strong in Fiscal Year 2024.

In addition to examining and determining the key policy and curriculum priorities, the report also examines: total K-12 spending; distribution and utilization of ESSER funds; state funding trends; social and emotional learning; the impact, potential and risks of AI in the classroom; the science of reading; and how classrooms continue to grapple with difficult social issues such as gun violence, homeless students, and mental health. Also covered are trends in connectivity and date privacy as well as staffing and teacher pay.

The report outlines several significant policy and budgetary concerns, including: increased operational costs and oversight and accountability issues at the district level; inequities in funding distributions across multiple regions; and the end of ESSER funding. A main source of the compiled data is the US Department of Education’s National Center for Education Statistics - which is generally viewed as the most authoritative source for data of this type - along with information from state education departments, local school districts, and state legislative bodies.

The report covers major themes and elements impacting education, including:

• FY 2024 Congressional Appropriations
• FY 2025 Congressional Appropriations
• Federal Relief and Its Impact
• State Funding Trends
• State Specific Initiatives and Policy Changes
• Current Curriculum Issues
• Policies Influencing Curriculum
• The Impact of Social Issues
• Staffing and Teacher Pay

The report conducted a review of publications, public announcements, and other information and data covering educational policy and budget trends nationally and locally.

The editors and analysts also utilized multiple sources, including:

• AASA: The School Superintendent Association
• American Councils Research Center (ARC)
• American Educational Research Association
• American Federation of Teachers
• American Library Association (ALA)
• Association of American Publishers
• Calder Center at the American Institutes for Research (AIR)
• Campaign for Our Shared Future
• Centers for Disease Control and Prevention
• Code.org, with the Consumer Science Teachers Association and the Expanding Computing Education Pathways Alliance
• Connected Nation
• Council of Chief State School Officers
• CRT Forward, an initiative of the University of California-Los Angeles School of Law and its Critical Race Studies Program
• Department of Education’s Institute of Education Sciences
• Education Next Survey of Public Opinion
• Education Trust
• Edunomics Lab at the University of Georgetown
• EdWeek Market Brief
• Gallup
• FiveThirtyEight
• FutureEd
• Institute on Taxation and Economic Policy
• K-12 School Shooting Database
• K-12 Security Information Exchange
• Media Literacy Now
• Movement Advancement Project
• National Association of School Budget Officers (NASBO)
• National Association of State Boards of Education
• National Governors Association
• National Institute for Early Education Research (NIEER)
• NPR
• Omdia
• PEN America
• Pew Research Center
• Rand Corporation
• SchoolHouse Connection and the University of Michigan’s Poverty Solutions
• Seal of Biliteracy
• The Florida Policy Institute
• The National Center for Home Education
• US Census Bureau

Publishers and investment professionals can trust this report to provide the inside intelligence needed to evaluate the growth potential and understand the trends impacting the PreK-12 market. This report is an essential tool for publishing executives, M&A advisors, market analysts, and industry consultants who need to understand the larger budgetary and policy trends impacting the PreK-12 instructional market.

Federal Funding for PreK-12 Education

In the complex landscape of the United States’ PreK-12 education system, understanding the nuances of federal funding is crucial. Financing public schools for students in kindergarten through 12th grade involves a dynamic blend of local, state, and federal monetary contributions, each playing a distinct role in shaping educational opportunities and outcomes.

While state and local governments form the backbone of educational funding - accounting for approximately 89% of total financing - the federal government contributes through targeted grant programs designed to address specific needs. These grants primarily support schools serving at risk youth, including students with disabilities or those from low-income households. This federal support is critical, particularly during economic downturns when state and local revenues may falter, ensuring that educational standards are upheld even in challenging financial times. Federal initiatives like the Title I grants under the Elementary and Secondary Education Act (ESEA) and Part B grants under the Individuals with Disabilities Education Act (IDEA) are pivotal. They not only supplement state resources but also aim to narrow the funding gaps for at risk students, ensuring equitable educational opportunities across diverse socioeconomic landscapes.

This chapter delves into the intricacies of federal funding within the PreK-12 education sector, exploring its impact on educational equity and quality, and examining how these funds are allocated among states and districts to meet varying educational needs. The analysis will provide a comprehensive understanding of the federal role in an era marked by significant educational challenges and transformations.