A new report from the Albert Shanker Institute, “Does Money Matter in Education?” confirms what educators have long known: money matters in education, and even more so for students in underfunded communities. The study, a comprehensive review of decades of research, finds that increased investment in schools leads to better student outcomes, while funding cuts harm them.
Where Money Goes, Achievement Follows
The report finds that additional funding improves student performance, particularly when invested in smaller class sizes, teacher compensation, and infrastructure improvements. Schools prioritizing hiring more teachers and increasing instructional support see higher test scores and long-term academic gains. Likewise, financial investments, such as improved heating, ventilation, and classroom facilities, boost learning conditions and aid in teacher recruitment and retention.
The Equity Gap: Poorer Schools Need More Funding
One of the most striking findings is that money matters most in communities that have been historically underfunded. The return on investment in these schools can be up to 20 times higher than in wealthier districts, proving that progressive funding models are essential to closing achievement gaps. The report also highlights the dangerous impact of funding cuts, showing that reductions in school budgets lead to lower graduation rates, increased dropout rates, and reduced lifetime earnings for students .
Texas Needs to Step Up
Despite overwhelming evidence that education funding improves outcomes, many states, including Texas, continue to underfund public schools. Texas ranks near the bottom nationally in per-pupil spending. Without meaningful investments, students in low-income communities will continue to face systemic disadvantages, disadvantages that disproportionately affect black and brown communities the most.
As lawmakers debate budget priorities, this report serves as a reminder that failing to fund public education equitably is a policy choice with real consequences for students and communities. When schools receive adequate funding, students can thrive in these well-funded environments. When funding is cut, students suffer.
None of this is breaking news to Texas educators, as most of these concerns highlighted are being felt in our communities. Our Educator’s Bill of Rights, crafted through direct feedback from our members, highlighted many of these issues that created our legislative agenda. Every student has a right to quality education, but a significant factor is holding our legislators accountable for their duty of fully funding our public schools.