> started growing much faster than the tax base

So you have two unaddressed problems.

> A better solution would have been to fund education more equitably at the state level

Which could only work if the state was "richer" than the local district. So by playing abstract and unnecessary games with money and districting we intentionally prevent schools from accessing the funding which could obviate concerns over this "fraud" issue entirely.

> but that was not a lever that the school district had at the time.

The idea of a parent "fraudulently" getting their child an education from a "district" is still just hilarious to me. What is the point of this system? To make parents play games or to educate children?