ABSTRACT

Public school finance at the start of the millennium is characterized by slowing revenue growth from traditional, broad-based state and local taxes (e.g., income, sales, and property taxes), and rising levels of revenue from nontraditional sources (Addonizio, 1998; Brunner & Sonstelie, 1997). These new, nontax sources of revenue are a testament to the creativity, and occasional desperation, of public education leaders who face at once flagging taxpayer support, rising enrollments, heightened expectations for academic achievement, and increasing competition for students and revenue arising from market-based changes in our public school system. Indeed, these market-based reforms, which typically involve increased school choice within and across local districts and, more recently, for-profit public schools, often trigger both a redistribution of traditional tax revenues across schools and the generation of new revenue from local sources.