Introduction to the Property Tax–School Funding Connection

Property taxation and school funding are closely linked in the United States: 45 percent of total public K–12 education revenues come from local governments and 80 percent of the local share comes from property taxes. In a well-structured school finance system, both major funding sources—property tax and state aid—will ensure that schools can provide an adequate education for all students equitably and efficiently.

We have published a variety of resources designed to promote basic understanding of the relationship between property taxation and public K–12 education funding.

Balancing Act: The Property Tax—School Funding Dilemma

Based on the Policy Focus Report, Rethinking the Property Tax–School Funding Dilemma, this explainer video examines the roles of the local property tax and state aid in funding public education. The video traces the history of funding for public schools while exploring the strengths and challenges of these two revenue sources. Property taxes provide local control and stable funding but can lead to inequalities between wealthy and poor districts. State aid helps address these disparities but can be unreliable during economic downturns and has the potential to erode local control. The video emphasizes that combining property taxes with state aid allows for both local control and greater equity, creating a more balanced and effective school funding system to ensure all students have access to a quality education.

Cover of Rethinking-Property Tax School Funding Dilemma

Enfoques en políticas de suelo

Rethinking the Property Tax-School Funding Dilemma

This report updates The Property Tax–School Funding Dilemma, a Lincoln Institute Policy Focus Report published in 2007. It describes the joint role of the property tax and state aid in funding public K–12 education, analyzes the strengths and weaknesses of each funding source, presents case studies of five states, and concludes with a dozen recommendations. Some recommendations seek to make the local property tax more equitable and efficient; others suggest ways to improve state aid.

Read the Report

The Property Tax–School Funding Connection

This webinar series explores the experience of three states that have enacted various types of property tax limitations and their efforts to ensure that funding remains adequate for public education. Presenters from each state assess the effectiveness of those efforts and suggest possible policy reforms.

Watch the Recordings