Spotlight On: North Carolina’s Allotment Approach and How Teacher Sorting Affects Funding Fairness

Spotlight On: North Carolina’s Allotment Approach and How Teacher Sorting Affects Funding Fairness

In North Carolina, the state allots teaching positions to each school district based on the number of students in each grade, according to specific ratios set by the General Assembly. The classroom teacher allotment is by far the largest single state allotment: salary and benefits for teaching positions represent approximately 55% of total state support for education.

What is unique about this approach is that the largest state education resource allocation is made in the form of positions, not dollars. This position-based allotment model was intended to give districts and principals more hiring flexibility, allowing them to have a ‘budget blind’ hiring process. In other words, a school or district can hire any qualified candidate, regardless of where he or she falls on the state salary schedule.

While well-intended, a recent NC Program Evaluation Division (PED) study found that “the structure of the [position] allotment exacerbates” a phenomenon called “Teacher Sorting.” Teacher sorting occurs when experienced, highly qualified teachers become concentrated in affluent schools. Several studies have found that teacher sorting has negative effects on students because it limits access to highly effective educators. The PED analysis shows that North Carolina’s position allotment structure exacerbates this phenomenon and deprives high-poverty schools and systems from important funding resources.

The financial impact of teacher sorting can be significant and has its greatest negative impact on low-wealth schools and districts. The figure below shows the disparity between the districts with the highest and lowest average teacher compensation. In this scenario, District B receives $649 less funding per student because their average teacher has less experience and is not Board Certified. If districts A and B each have 10,000 students, the funding differences between the districts is $6,490,000.