Education First conducted this study to examine how state education agencies (SEAs) allocate federal and state funding to aid schools identified for support and improvement as required by the Every Student Succeeds Act (ESSA). Our aim is to identify and share promising practices that better align funding with need, support sustained academic improvement and build coherence across initiatives.

Despite the federal requirement for states to set aside 7% of Title I, Part A funding to support schools identified for improvement, there remains limited understanding of how states decide which schools receive funding, how much is allocated and what strategic priorities or rationale shape these decisions. This report aims to fill that gap.

Drawing on research from 29 states, including document reviews, interviews and a survey, this report addresses three core objectives:

• Evaluate how SEAs currently allocate school improvement funds
• Identify promising practices in allocating funding and leveraging state funds
• Recommend strategies for improving the sufficiency, coherence and strategic use of funding

Key Findings

1. States make different decisions about which schools to fund.
   • Most states in our sample fund all school types identified for improvement (CSI, TSI and ATSI), but some limit funding to CSI schools or use competitive processes to prioritize schools with the greatest needs or with specific improvement strategies.
2. Funding amounts are mostly based on fixed, non-evaluative factors.
   • States in our sample typically determine funding amounts using fixed, non-evaluative information like designation type, enrollment size, or per-pupil formulas. Few directly assess whether funds match the cost of the improvement strategies proposed or the levels needed to support them. However, some states with competitive approaches like Colorado and Delaware attempt to do so.
3. Hybrid funding approaches show promise in balancing equity and innovation.
   • States like Massachusetts and Rhode Island use a mix of formula and competitive funding to ensure baseline support while incentivizing more ambitious, strategic improvement plans through targeted competitive grants.

Recommendations

Given that federal school improvement funds are chronically under-resourced, states should act to:

1. Adopt competitive or hybrid allocation approaches that prioritize need, strategic alignment and the cost of evidence-based strategies
2. Leverage other federal and state funding streams to build coherence across improvement efforts and increase the total resources available
3. Invest in SEA and LEA capacity to evaluate, support, and implement high-quality improvement strategies tied to instructional quality and equity
4. Design state funding to complement federal dollars, ensuring schools not prioritized by federal formulas (e.g., TSI) are not left behind.