This paper outlines school finance issues that have emerged due to litigation on the constitutionality of school funding at the state level. Such funding varies from state to state, ranging from 8 percent in New Hampshire to 74 percent in New Mexico; per-child expenditures range from $1,500 to $15,000. Beginning in the 1970s, poor school districts and some advocates for minority and disadvantaged children challenged the state-funding formula in the courts. These court cases have focused on the constitutional provisions on the ground of equity or adequacy. Equity is generally defined as a relatively equal per-pupil expenditure across the school districts in the state. Recent court cases have begun to address the issue of an "adequate" education for all students. States must shift their focus from monitoring students' inputs (student-to-teacher ratios) and focus on the outputs (graduation rates and reading levels). States must focus on the definition of what an adequate education is and what amount of funding is needed for all students to have a possibility of obtaining it. The paper describes the six different funding methods used to achieve an adequate education: flat grants, foundation programs, guaranteed tax base programs, percentage equalization programs, full state funding, and pupil weights. (DFR)