Public Education Now a $305 Billion Industry

Published September 1, 1999

Tax revenues for public education in the United States surged 6 percent in the 1996-1997 school year, pushing total income to $305 billion from $288 billion a year earlier, according to a new report from the U.S. Department of Education.

Spending per student increased by 4.2 percent, to $5,923 from $5,689 in 1995-1996. Federal resources devoted to public education made up a scant 6.6 percent of the $305 billion total, with state sources providing 48.0 percent and local and intermediate sources providing 45.4 percent.

These and other financial data for the 50 states and the District of Columbia for public elementary and secondary education are available in the June 1999 report, Revenues and Expenditures for Public Elementary and Secondary Education: School Year 1996-1997, published by the U.S. Department of Education’s National Center for Education Statistics. The data are collected and reported each year as part of the National Public Education Financial Survey.

Of the $305 billion income for public education in 1996-1997, $35 billion was assigned to construction, equipment, and debt financing. The remaining $270 billion, called “current expenditures,” was spent on instruction (61.9 percent), support services (33.7 percent), and on other non-instruction services such as food service and bookstores (4.4 percent). Instruction expenditures include teacher salaries and textbooks, while support services include school maintenance, nurses, administration, and library services.

Revenues by state ranged from a high of over $34 billion in California to a low of $643 million in North Dakota. Three states–California, New York, and Texas–accounted for more than a quarter (27.3 percent) of all public education revenues. Almost half (49.5 percent) of all public education revenues were raised in just eight states: California, New York, Texas, Pennsylvania, Florida, Michigan, Illinois, and Ohio.

The top 15 states account for more than two-thirds (67.8 percent) of all public education revenues in the United States. In sharp contrast, the bottom 15 states account for less than 5 percent of those revenues.

Revenues from local and regional sources made up an average of 45.4 percent of U.S. public education revenues, ranging from 2.4 percent in Hawaii to 89.5 percent in the District of Columbia. Revenues from state sources averaged 48.0 percent nationally, with New Hampshire ranking lowest at 7.4 percent and Hawaii ranking highest at 89.5 percent. Revenues from federal sources averaged 6.6 percent nationally, ranging from a low of 3.5 percent in Connecticut, New Hampshire, and New Jersey to a high of 14.0 percent in Mississippi.

In the 1996-1997 school year, the 50 states and the District of Columbia spent an average of $5,923 per student, with individual jurisdictions ranging from a high of $9,588 in New Jersey to a low of $3,783 in Utah. Median spending per student was $5,734, indicating that half of the states educated students for less than $5,734 per student.

For more information …

The June 1999 report, Revenues and Expenditures for Public Elementary and Secondary Education: School Year 1996-1997, is available from the U.S. Department of Education by calling 1-877-4-ED-PUBS and requesting a copy. The Department also makes the report available from the Web site of the National Center for Education Statistics at