Six Reasons Why Hold Harmless is Anything But for Kids

Hold harmless is a policy that guarantees school districts the same amount of funding as they had in the prior year, regardless of fluctuations in enrollment. This means that public school districts receive the same amount of funding from Harrisburg regardless of how many students exit the school system, whether by graduating, relocating, dropping out, or switching to homeschool or private school. 

Here are six reasons why Pennsylvania’s hold-harmless policy hurts public education.

1. It creates funding inequities.

Inequities in Pennsylvania’s education funding exist because the commonwealth relies primarily on its hold-harmless approach rather the student-based formula.

2. School district budgets grow but help fewer students.

Because Pennsylvania funds school districts rather than kids, school districts grow their budgets with little incentive to help kids who require specialized education.

3. High-needs kids fall through the cracks.

Hold harmless fails to take students’ needs into account. Kids in economically disadvantaged communities, English language learners, and special-needs kids with Individualized Education Programs deserve increased funding to address their specific needs. However, hold harmless fails to provide for Pennsylvania’s most vulnerable students.

4. It underfunds growing districts.

Hold harmless guarantees funding regardless of current enrollment rates. Schools with increased enrollment are at a disadvantage because they receive funding based on previous lower enrollment numbers

5. Taxpayers are on the hook to subsidize shrinking schools.

Schools experiencing shrinking enrollment are also at a disadvantage; low-enrollment schools are costly to operate. The cost to heat, cool, and staff these underutilized facilities is higher than that of better-optimized schools. Taxpayers bear the burden of continuing to fund schools losing students.

6. It doesn’t improve academic performance.

Pennsylvania adopted hold harmless in 1992. Since then, Pennsylvania’s fourth-grade reading scores have declined, dropping from an average score of 221 in 1992 to 216 in 2024, according to the Nation’s Report Card. 

What is the solution?

If Pennsylvania followed a student-based funding formula, money would follow the student to their school—rather than to the school district where they live, which would more equitably distribute funds across the state.  

Solutions start with conversations. Lawmakers need to discuss the benefits of a student-based funding formula, such as the one in Tennessee.

Pennsylvania lawmakers should consider funding students directly rather than school systems. This would allow funding to follow the student regardless of the school they attend, providing adequate funding for each student’s specific educational needs.

All 2 million K–12 students in Pennsylvania deserve a fairly funded education, regardless of whether they are public, private, charter (both cyber and brick-and-mortar), vocational, or homeschool students.

This pie chart illustrates the inequity in funding schools (navy blue) compared to direct funding for students (gold). The baseline numbers (navy blue) show the percentage of state funding flowing to schools regardless of enrollment. The gold slice of the pie chart shows the percentage of funding that runs through the funding formula.