A large literature finds that resources are not significant determinants of student performance. These results may arise because resources really do not matter in public education or because local school districts allocate additional resources to poorer performing schools. To shed light on this issue, a unique data set for the Metropolitan Nashville-Davidson County School District in Tennessee, known as Metro, is analyzed. Financial data from 2004-05 are combined with academic test scores and demographic data for 2003-04 and 2004-05 academic years for each of 70 K-4 elementary schools. Econometric tests indicate that school-specific budget allocations do not discriminate against minorities and are mildly favorable for low-income students. Direct funding is not significantly related to school performance, although community resources significantly improve reading performance. (Contains 9 footnotes, 5 tables, and 1 figure.)