The full state funding model assumes that education is a state function, and all the revenue raised for
education should come from state—not local—sources. Only Hawaii has truly a full state funding model.
Hawaii has a single, unified school system under the governor’s and state legislature’s financial control.
Hawaii’s funds come from the state general fund supported by state income, sales, and excise taxes. Other
states have been reluctant to adopt such a model.
The full state funding concept offers a paradox. Education, by constitutional definition, is a state
function. Leaving the education funding responsibility to localities gives opportunity for the rich to provide the
best services and the poor to provide the least. In theory, full state funding could be an effective method to
achieve fiscal equalization. In reality, however, the politics of influence and resources still play a major role in
One healthy aspect of some local funding discretion for school districts within a state
exists—competition. When school districts compete for personnel with enhanced compensation, benefits, and
professional development programs, and when they vie for students with excellent instructional programs and
facilities, the entire community benefits. This competition may not exist in a full state funding model. Full state
funding has one unhealthy distinction: in Hawaii, it moves control of the system and access to it far from the
people it serves.