Today we’re going to take a closer look at how much Virginia’s school funding formula is out of whack with reality.
You may recall that I wrote recently about how Franklin County was shocked to see that its score on the Local Composite Index — the state’s formula that is used to determine each locality’s ability to pay for its schools — had shot up to the highest in this part of the state, which translates into about a $3.7 million loss in state funding.
Two things are driving this: the influx of new residents around Smith Mountain Lake, who are helping drive up property values, which constitute a big part of the LCI. Also, the departure of some students out of the public school system for private schools or home schools. The theory is if a school system has fewer students, it doesn’t need as much funding, but that’s not entirely true — no matter how many students a school has, the building still has to be heated, the bus routes still have to be run, and you still need a first grade teacher whether there are 20 students in the class or 10.
Those who think the LCI should be changed say a better measure would take into account other things, such as the number or percentage of students in poverty, because they start school with the most disadvantages that educators must work to overcome.
With that in mind, I took another look at the most recent LCI figures across Virginia. Now, I don’t mean to pick on Loudoun County, but Loudoun County is the most affluent county not just in Virginia, but in the whole United States, so I started off with that as my baseline. How many localities are deemed by the state’s funding formula to be better able to pay for their schools than our most affluent county, with a median household income of $170,463?
22 localities are rated better able to pay for their schools than Loudoun County
Some of these you’ll see are in Northern Virginia, and maybe it’s not worth quibbling over whether Fairfax County is better able to pay for its schools than Loudoun (although Fairfax County officials may want to talk about that). I’m much more curious about the other localities, particularly the rural counties that rank so high.
Two of those counties fall into special statistical cases: Both Highland County and Surry County score a perfect 0.8000 — the highest score available — compared to Loudoun County’s 0.5518. It’s not that they’re wealthy, because they’re not. In Surry, the median household income is $68,655. In Highland County, $57,070. Highland, though, is the least-populated county in the state, with just 190 students. The state thinks that means Highland ought to be able to take care of itself, never mind that it has to run bus routes over more territory than Fairfax County. Surry County’s formula is skewed by a different problem: It’s home to a nuclear power plant, which makes the county look more affluent than it really is.
There are often odd examples to everything, though, so let’s set Highland and Surry aside. Instead, let’s ask why a cluster of four rural — and relatively poor — counties along the Chesapeake Bay are rated better able to pay than Loudoun County.
‘Rural resort’ counties get penalized under the state funding formula
“Rural resort” is a relatively new phrase, at least to me. It refers to rural counties that have become destinations for retirees or remote workers, particularly in the Zoom-era migration that’s taken place since the pandemic. In Virginia, this cluster of counties along the bay, along with Nelson County (home to Wintergreen Resort), have become magnets for both those groups. To some extent, Highland County and Rappahannock County might also qualify as “rural resort” communities — picturesque, lightly populated counties that have acquired a certain amount of glamour over the years for their bucolic settings. The rising property values in all these counties have skewed the LCI scores, coupled with declining enrollment. That’s the phenomenon that Franklin County is dealing with. So are some other localities that don’t score as better able to pay than Loudoun County — at least not yet.
20 of the 22 localities ranked better able to pay than Loudoun County have higher poverty rates
Those who’d like to see the LCI changed say the number of students in poverty should play a role in the formula. Here’s why. In Loudoun County, 16.73% of its students live in poverty, according to the Virginia Department of Education. Only one other locality in the state has a smaller share of students living in poverty: Falls Church, at 6.96%. Data for Fairfax city wasn’t available.
Here’s how many students living in poverty those other 20 localities ranked better able to pay than Loudoun have:
Fairfax 23.31%
Arlington 23.45%
Clarke 24.72%
Fauquier 26.59%
Albemarle 27.2%
Goochland 28.75%
Highland 31.68%
Williamsburg 32.86%
Rappahannock 37.1%
Alexandria 40.86%
Mathews 41.91%
Charlottesville 46.6%
Fredericksburg 50.05%
Nelson 53.20%
Surry 58.87%
Middlesex 59.68%
Northumberland 59.77%
Charles City 63.8%
Lancaster 68.3%
Richmond city 70.68%
Here we see the problem in a different way: Those “rural resort” localities that look so affluent on the LCI scores have high poverty rates — from 53.20% in Nelson County to 68.3% in Lancaster County. And these are just the ones that scored higher than Loudoun. Northampton County on the Eastern Shore has seen its LCI score shoot up and get closer to Loudoun, thanks to a lot of development around Cape Charles. Meanwhile, Northampton County still has 71.47% of its students living in poverty.
This isn’t a problem unique to those rural resort communities, either. One of the localities ranked better able to pay than Loudoun is the city of Richmond, which has 70.68% of its students living in poverty. Richmond, like Northampton County, like Franklin County, like some other localities, has seen its LCI score rise in spite of having so many students in poverty. Over the past decade, Richmond’s score has risen from 0.4758 to 0.5740, one of the biggest increases in the state. That’s probably a testament to the redevelopment that’s taken place in the city, but that hasn’t changed endemic poverty.
Some glaring inequities
If we’re going by the percentage of students in poverty, then the two poorest localities in the state are the city of Franklin, where 94.57% of students live in poverty, and Sussex County, where 92.29% do. Franklin city’s LCI score is an appropriately modest 0.2884, although still higher than many other localities with lower (but still high) poverty levels. Sussex, though, comes in at 0.3434 — higher than Bedford County with its lakefront property and not that far behind Chesterfield County in the Richmond suburbs at 0.3563. In Bedford, the poverty rate is 39.24%, in Chesterfield, 34.83%.
Let’s frame this another way: Sussex County, where the median household income is $59,195 and the student poverty rate is 92.29%, is ranked as having about the same ability to pay for its schools as Chesterfield County, where the median household income is $95,797 and the student poverty rate, while still high, is almost one-third what it is in Sussex. I realize there are a lot of other considerations I’m not taking into account. For instance, Chesterfield County has a lot more English language learners than Sussex does. A study last year found there are 69 languages other than English spoken by Chesterfield students; in Sussex County, just one. Still, something seems amiss.
Charles City County may suffer the most under the LCI
Charles City County has a median household income that’s 38% of what Loudoun County has. It has a student poverty rate of 63.8%, almost four times higher than Loudoun’s. Yet Charles City somehow is ranked with more ability to pay for its schools than Loudoun, with an LCI score of 0.669 to Loudoun’s 0.558.
Charles City County, a small, rural county east of Richmond, suffers in the LCI because the county’s population has been declining, and so has its enrollment. Fewer students means a presumed reduced need for funding, although as noted above the infrastructure costs and many of the personnel costs remain the same.
You’ll see in the chart above how Charles City County’s LCI score has risen over the years, relative to Loudoun County.
Some rural localities suffer under LCI but others benefit
The problem with changing any funding formula is that, unless you increase the overall amount of spending, there’s a risk that somebody will wind up with less money than before. That makes those who benefit the most from the LCI the most reluctant to change — and those LCI beneficiaries are almost entirely in Southwest and Southside. The localities deemed the least able to pay for their schools are:
Radford 0.1658
Lee County 0.1712
Buena Vista 0.1803
Hopewell 0.1870
Scott County 0.1872
Wise County .02020
Petersburg 0.2075
Giles County 0.2117
Dickenson County 0.2175
Smyth County 0.2225
Those localities may think they don’t receive enough from the state, so they sure don’t want to receive any less. That’s the challenge: Can Virginia design a better system for school funding that helps Charles City County and Richmond and those counties along the Chesapeake Bay without penalizing Southwest and Southside?
