Each state is different, so school funding is different too. A dollar does not go as far in every place. That means we need to look at both adjusted and unadjusted dollars to make fair comparisons. This is one of those concepts that can sound overly technical and not important – but it really matters for how we understand education spending.

You may be thinking, “How important is this really? Aren’t dollars just dollars? How complicated can it be?” We hope we can shed some light on this topic.

The main reason why you can’t compare unadjusted dollars fairly across places is due to differences in purchasing power. So, when we talk about adjusting dollars within and across states, we’re talking about how much purchasing power a dollar has in one place compared with another.

Here’s an example. Let’s say that a cup of coffee costs $3.30 in Youngstown, Ohio. That same cup of coffee costs $4.60 in Boston, Massachusetts. This is due to purchasing power—prices are higher in Boston. The difference in price reflects different local costs, not a different cup of coffee.

Purchasing power may also vary within a state. This means that we need more detailed, local adjustments before we can make fair comparisons across communities. This is especially true in states like California, North Carolina, Texas, and Utah. These states have large urban centers and vast rural areas.

So, how do we make these adjustments? On our State Funding and Finance Map, we use the Comparable Wage Index for Teachers (CWIFT) to adjust dollars to local cost differences. This lets us compare things like education funding and revenues fairly across states and districts.

There are other indexes that we can use to adjust dollars. But we use CWFIT because it accounts for the different cost of delivering education in different places. 

What Is the CWIFT?

The CWIFT estimates how much districts would need to pay to attract and retain workers with a college degree in each geographic location. The cost to pay teachers and other school staff is the biggest part of the cost of education. For example, to hire someone with experience like a teacher might cost about $35,000 a year (plus benefits) in Youngstown. But it would cost about $57,000 (plus benefits) in Boston. The CWIFT measures the difference in the cost levels for staff from the national average. CWIFT can use this data to convert funding or spending figures to equal values in the same national baseline dollar. This allows us to compare apples to apples.

Keep in mind that the CWIFT helps us convert everything to national dollars. So, in this example, inYoungstown, where costs are lower than the national average, we need to adjust costs upward. In Boston, where costs are higher than the national average, we need to adjust costs downward. These adjustments reflect dollars standardized to the national average.

How We Use CWIFT on the Data Map

Our State PK–12 Finance Map has a “Local Cost Adjustment” feature that applies to everything with dollars on the map. It lets you choose between two views. The first view (called “As-reported $”) shows the dollar amounts reported by each state. The second view (called “Cost-adjusted $”) shows cost-adjusted dollars that use CWIFT to account for differences in cost levels across states.

Put simply, CWIFT helps us account for differences in purchasing power from place to place. That way, comparisons show what districts and states can afford to purchase—not just how much they spend. It lets us make comparisons across regions that are clearer and more meaningful.