Federal Solutions to School Fiscal Crises

Abstract

Applying a Multiple Streams framework, the article documents the development and ultimate undoing of what became known as the national sales tax plan for education. The authors identify four factors that coalesced to lead the Nixon administration to propose replacing local property taxes with a federal value-added tax to finance K-12 education. They further delineate key supporters and opponents, along with their arguments for and against the plan, finding that intergovernmental tension between administration officials and state governors, opposition on Capitol Hill, public opinion, a supreme court ruling, and the Watergate scandal came together to unravel the plan before it could be formally introduced in Congress. Finally, the authors discuss what this case tells us about the complexity federalism brings to public school finance.