Financial Model

Typical public education finance models are local, state and federal funds distributed back to schools to spend on students. It may be time to reimagine where the money comes from and how it flows through the system.

Education Savings Accounts

Overview: Financial Model

In this short video we take a look at how funding has happened in the past and how it may change in the future to better enabled an unbundled learning ecosystem.

Typical public education finance models are local, state, and federal funds distributed back to schools to spend on studentswith the majority of funding supported by the local tax base. A distributed model might make use of back-packed pass-through funds via the schools. Current debate exists around whether families should get all control of funds or whether funds, while still attached to the student, should flow through existing schools. 

As students get older, direct face-to-face interaction with educators (which may be more critical at younger ages) may transition to coaching and mentoring as students choose their learning experiences from the decentralized learning experience ecosystem. Learning Experience Designers would be compensated when, and only when, a student successfully demonstrates proficiency on the linked competency. This Pay for Success model would ensure quality in the system.

My Tech High operates as a provider for school districts but allows significant choice in both course content and crediting typical out-of-school experiences. In these provider models, a portion of the student funding remains with the district while the rest flows to the provider to allow for unbundled learning. This creative solution is designed to both increase district enrollments while supporting funding for learners to choose how they learn.

Black Mother’s Forum and Adamo Education, launched during the pandemic, partner with an existing virtual charter school to provide pass-through financial resources and online learning to small tuition-free learning pods in Arizona.

Many states have adopted vouchers, Education Savings Accounts (ESAs), and scholarship tax credits that go directly to the learner/school to support their education. While controversial due to the potential to decrease funding to the public sector, more control is given to the learner to build an experience that best fits their goals and expected outcome. These tools support an unbundled learning ecosystem. Idaho’s Advanced Opportunity offers $4,000 per middle and high school student for higher ed courses. Colorado’s HIgh School Innovative Learning Pilot provides full-time student funding to districts for students who are enrolled part-time, reducing the financial burden on the district when a student unbundles their learning.

In order for unbundled learning models to work, either the institutions that control existing funding must increase flexibility for building the learning journey (such as the My Tech High model), or funding itself must attach to each learner directly (as in the voucher/scholarship model).

Finally, some states have legislated policies to support credit for out-of-school learning opportunities. Currently, this is primarily in the form of work-based learning, internships, or apprenticeships. Newer “learn everywhere” type policies vary by state and often run counter to traditional credit or seat-time requirements. However, these policies do provide templates that are the foundation for crediting out-of-school experiences.