# Plain Language Summary of the ACE Act

The ACE Act (All Children are Equal Act) changes how the federal government distributes money to school districts based on poverty levels. Right now, the government uses two different methods to calculate how much funding each school district gets, and it picks whichever method gives each district more money. This bill says that starting in 2024, the government should use only one method—the one that focuses on the percentage of poor students in a district rather than the total number of poor students.

Here's why this matters: Under the current system, large school districts with many poor students tend to get more money, even if the percentage of poor students there is lower than in smaller districts. A small rural district might have 60% of its students living in poverty, while a large city district has only 40% living in poverty, but the city district could still get more federal money because it has more total poor students. The bill argues this goes against what Congress actually intended—to send more money per student to districts with the highest concentrations of poverty.

The change takes effect gradually. Through 2023, school districts will continue using the current system that favors whichever calculation gives them the most money. Starting in 2024, all districts will switch to using only the percentage-based method. According to the bill's supporters, this will shift some federal education funding from larger districts to smaller ones with high poverty rates, making the distribution fairer. However, larger districts that currently benefit from the dual system would likely see their federal funding decrease under this change.

ACE Act

Thompson, Glenn

All Children are Equal Act or the ACE ActThis bill revises the funding formulas for distributing Targeted Grants and Education Finance Incentive Grants to local educational agencies (LEAs) by prioritizing allocation of funding to LEAs with a higher percentage of students from low-income families. &nbsp;