Brimley and Garfield (2008) share four criteria in evaluating a tax structure. Equity, efficiency, adequacy, and adaptability are their focus. To be thorough, it is necessary to break down equity into two parts which constitutes a fifth criteria. Equity for children and equity for taxpayers.
Equity for children – Fairness in providing an equal opportunity for an education for all children.
Equity for taxpayers – Fairness for all citizens.
Efficiency – A structure of fiscal management that provides the most services at the least cost.
Adequacy – Provides adequate funding for the fiscal needs of what the institution has deemed necessary to provide such public service.
Adaptability – A system that is flexible and responsive to changing economic conditions, changes in education, and “modified social demands for education” (Brimley & Garfield, p. 124, 2008).
Revenues collected and used for education include property taxes – real property and personal property, income tax, sales tax, sumptuary taxes, severance taxes, lottery revenues, and income from bond measures (Brimley & Garfield, 2008).
Education funded largely by property taxes have been commonly accepted as a reasonable expenditure of such resources as property ownership represented wealth, and wealth was an indicator of those most able to pay (Brimley & Garfield, 2008). Brimley and Garfield go on to explain “property tax at the local level has proved to be a good and reliable source of revenue for operating schools” (Brimley & Garfield, p. 125, 2008). The authors further add that people are able to understand the purpose of these taxes and that they are easily collected. As of recent economic conditions, property ownership is not an accurate indicator of wealth. Net ownership of the property is not considered (Brimley & Garfield, 2008). Furthermore, due to less than honest loan practices, individuals were financed for properties they could not afford.
Adequacy and equity must be considered in determining the effectiveness of a system. Varied tax assessment practices exist and are often not equitable. Additionally, taxpayers look for ways to circumvent tax laws by investing their monies in types of personal property that are not taxed. In this way, true wealth of a citizen may not be determined.
Equity in education cannot exist without also looking at the demographics of geographical regions. City schools tend to have a higher population of disabled students, disadvantaged students, and minority students which adds a higher cost for establishing and supporting an adequate educational structure Income tax reflects a more accurate measurement of wealth and “is far more sensitive to economic growth than are property or sales taxes and therefore can help solve the state-local fiscal crisis” (Brimley & Garfield, p. 130, 2008). Sales taxes, according to Brimley and Garfield (2008) “are effective at the state level but are not readily manageable at the local level, especially in small school districts. Sales taxes are regressive when food items and other necessities are taxed, since low-income families generally spend a higher percentage of their income on necessities than the affluent do.” (p. 141)
Also, a rural area does not have the same ability to raise tax revenue of a higher populated community. In this way, property taxes would prove to insufficient in providing the same opportunities as either a highly populated area or an affluent neighborhood.
Income tax reflects a more accurate measurement of wealth and “is far more sensitive to economic growth than are property or sales taxes and therefore can help solve the state-local fiscal crisis” (Brimley & Garfield, p. 130, 2008). California has the ability to provide tax credits to low income households and other various needs. It would seem that income taxes, then, would be the ideal for supporting education, however; raising funds through higher income taxes is a continual battle that the majority of citizens would likely not support.
Sales taxes, according to Brimley and Garfield (2008) “are effective at the state level but are not readily manageable at the local level, especially in small school districts. Sales taxes are regressive when food items and other necessities are taxed, since low-income families generally spend a higher percentage of their income on necessities than the affluent do.” (p. 141)
Supplementing local needs through bond measures is another avenue to meeting the needs of a district. Bond measures can provide the revenue needed for new infrastructure, buildings, and modernization in ever-changing communities, however; bond measures are dependent on interest rates and the willingness of property owners to commit to paying off the debt over the course of decades. This debt may and probably will be still being paid off even when the district incurs more needs. It is a temporary solution to an immediate need.
The “lottery tax” is another regressive tax as lottery tickets are often purchased by those that can least afford to spend the money on them. Furthermore, it only makes up 2% of state revenues (Brimley & Garfield, 2008).
How should education be funded to provide revenues that will support an adequate education for all students and is fair to all stakeholders? There may never be a perfect way, but perhaps we can only aim for a “best way.” The “best way” will always evolve based on the needs of communities and be dependent on the economic fluctuations of state solvency.
References
Brimley, V. & Garfield, R. (2008). Financing Education in a Climate of Change. Special Edition for Concordia University Chicago. Boston, Allyn and Bacon.

