When Mark Smith was principal of Houston's Anderson Elementary School in the early 1990s, he often ran up against a maddening mathematics problem. At the time, the Houston Independent School District doled out money to schools for nonteaching staff members--like assistant principals, clerks, and librarians--based on a set of enrollment formulas that topped out around 1,200 children. With 1,570 students, Anderson got no additional funding for such positions than did much smaller schools. His gripe partly explains why some districts, including the 210,000-student Houston schools, have adopted a "student-based" funding system. Instead of assigning staff positions based on broad enrollment ranges, a student-based system gives money to schools based on the actual number and kinds of students at each site. For a big school like Anderson Elementary, that means added funds for each additional student--and more flexibility in how to spend the money.