Utah’s Student Funding a Model for Colorado and Other States

Published May 31, 2012

As state leaders across the country consider how to increase student access to online learning, a new report by the Independence Institute outlines several important steps Colorado should take to insure digital education can flourish.

The most fundamental change recommended in “Online Course-Level Funding: Toward Colorado Self-Blended Secondary Learning Options,” authored by senior education policy analyst Ben DeGrow, is restructuring state school funding systems.

“Different students have different goals and motivations, and excel or need extra help in different subjects,” DeGrow observed. “No single provider—whether it’s a school district, charter school, or some accredited private program—can meet every student’s need in every area… Allowing the money to follow students to their chosen courses will be essential to ensuring that sort of change happens.”

Nearly 2 percent of the state’s students are currently enrolled in full-time online learning through 20 multi-district and 20 single-district programs. DeGrow argues access to online learning could be significantly expanded if the state enacts his recommendations.

The Utah Funding Model
The report notes the successes of other states in revamping funding formulas to make funding portable and expand online learning options. It focuses on Utah’s recent reforms in this regard. 

Utah students can select from online courses offered from any public school across the state and learn from home or also at another brick-and-mortar school where they are still enrolled. State education dollars follow a student to a chosen course, but the provider doesn’t receive the full amount until the student completes the course successfully. Utah has the lowest per-pupil spending in the nation but roughly average student performance.

Utah’s system catapulted the state to first place on Digital Learning Now’s 2011 State Report Card, noted Robyn Bagley, board chair of Parents for Choice in Education

“The largest paradigm shift in the law is that the money follows the student to the course of their choice,” Bagley said. “Districts and charters could sit back and watch students take the dollars to another option, or they could create a dedicated online program of their own to compete. Many chose the latter.”

The majority of participating school districts partner with private companies to offer online courses, which reduces the “sticky controversies that often undermine such paradigm-shifting policies from ever coming to fruition” until viable solutions arise, she said.

In less than one year after creating this structure, online options for Utah high school students increased 585 percent and were available in every public school in the state.

Backpack Funding
One of the cornerstones of DeGrow’s report involves moving toward “backpack” funding, where a state’s education dollars attach to individual students and can be divided among several schools or course providers. The report says this would help provide parents purchasing power and expand online learning options for children.

“The U.S. is moving away from a system driven by residential assignment to a system where funding is driven by parental choice and student enrollment,” said Lisa Snell, director of education and child welfare at the Reason Foundation.

Backpack funding is particularly important to digital learning because it allows students to pick from a menu of online classes, she said.

“Virtual courses can engage students effectively by meeting them right where they are academically, connecting them to digital experiences that fill other parts of their lives, and advancing them at a pace that allows them to truly master the material,” DeGrow said. “If we create a policy environment that allows digital innovation to flourish, students will be much better able to carve a personalized path to learning success in ways scarcely imaginable not long ago.”


Recommended Policy Changes
The Independence Institute report recommends these policies to improve online learning access in Colorado:

  1. Change the student count system to reflect movement toward online learning during the school year;
  2. Create “fractional funding” beyond just full-time or half-time funding;
  3. Allow education money to follow each student to any education provider of their choice;
  4. Fund providers based on performance;
  5. Establish independent audits of providers;
  6. Establish a pilot program to win support for statewide implementation.

Image by woodleywonderworks.