The results do not shed any particular light on why non-tax revenues are not used to close gaps during downturns in business cycles although they are used at other times when districts are faced with constraints. Possibly, exploring the interactions between school districts and their overlapping governments might indicate whether the use of non-tax revenues in school finance is lower when the use of such revenues to finance other local services is higher. But it may well be that there are limits to what traditional empirical analysis can tell us about what may be seen as underutilization of these revenue sources.

The discussion at the outset of this paper suggests that concerns regarding access and philosophical objections may be among the reasons why non-tax revenues are little used. And the evidence from all of the New England states, particularly Massachusetts and Vermont, is consistent with policymakers steering away from non-tax revenues for these reasons. But philosophical objections are especially difficult to quantify. Surveys of school district leaders may enable us to learn how pervasive these attitudes are and how strongly they correlate with the use of revenues from fees and other non-tax sources. That kind of qualitative analysis might be a useful next step in shedding light on why alternative funding sources have been so little used in New England and in the rest of the country.

During and even after the Great Recession, numerous popular press stories commented on the apparent growth of non-tax revenues in the face of school district budget deficits. But Downes and Killeen (2014) show that nationally the growth of non-traditional revenues has been far less than these articles may lead the reader to believe. This paper uses data from the New England states to assess the empirical content of some of the possible explanations of this slow growth. In New England, as in the rest of the nation, non-tax revenues per pupil have grown in real terms but have not become a more important source of local revenues. Further analysis of Massachusetts offers equivocal evidence on whether non-tax revenues substitute for or are complements to revenues from overrides of revenue limits. Results from Vermont show that, when the incentives created by a school finance reform are sufficiently strong, districts turn to non-tax revenues in place of property taxes. However, once those incentives are removed, districts shift back to traditional revenues, indicating that districts are not inclined to use alternative revenues as a permanent replacement for property tax revenues.