Monday, December 12, 2011

How Much is Enough?

On December 9, 2011, Colorado State District Court judge Sheila Rappaport, in the case of Lobato v. State of Colorado, issued a court order declaring Colorado's funding system for public schools to be unconstitutional, going on to say:
"Evidence establishes that the finance system must be revised to assure that funding is rationally related to the actual costs of providing a thorough and uniform system of public education. It is also apparent that increased funding will be required."
The Court has given the Governor and the state legislature until the end of the 2012 legislative session to come up with a fix.

Without even attempting to read or understand this case (I'm not a lawyer), I'll assume that that the arguments in this Colorado case have little difference to those raised by DeRolph v. State of Ohio, which was filed almost exactly twenty years ago.


DeRolph was the school funding case that made it to the Ohio Supreme Court, which declared the public school funding system then in use to be unconstitutional. Most people mistakenly believe the Supreme Court declared the use of property taxes to fund schools to be unconstitutional, but that's not at all what they said. Regardless, DeRolph is now moot, as the General Assembly has enacted two  different funding systems since then, and neither has been test by a lawsuit.

It looks like Colorado might be the next state to go down this road. Lobato will undoubtedly be appealed. If it isn't, and their legislature doesn't satisfy the Court's order, it will still raise the constitutional question as to whether the legislative branch in their state can be ordered to do anything by the judicial branch.

Both states have similarly vague, and not very useful constitutional standards in regard to public education. Ohio's Constitution talks about a "thorough and efficient system of common schools"  (Article 6.02), while Colorado's says "thorough and uniform system of public education."

It will be interesting to watch the Colorado case as it progresses. Lots of people would like to know how much a public education should cost and how it should be funded.

So how would we go about figuring that out - what Judge Rappaport called "actual costs" - and where should the money come from?

It seems to me that we first have to go back to the fundamental fact that 80-90% of the money spent on public education (88% in our district) goes to pay for the compensation and benefits of the teachers, staff and administrators who are employed by the school district, and most of that is spent on the teachers.

I'm not saying that's a problem. As long as educational services are delivered primarily by teachers in a classroom, that's where as much of the money as possible should be spent. Everything else should be viewed as support for what happens in the classroom, or as "extras" above and beyond the State requirements.

But how much should teachers be compensated, and how many of them should we employ (in relationship to the number of students)?

The notion of Governor Strickland's "Evidence Based Model" funding approach was that there are clear answers to those questions. The EBM specified how many teachers there should be, and how much they should be paid - at least at a minimum. It also specified how many folks we should have in key administrative and support staff roles, and also what they should get paid.

Here is a copy of our district's PASS report, the document which shows how a school district was funded under the EBM approach. Page 2 of the report spells out how many people we should have in specific job categories. For example, lines 6-12 detail the minimum number of teachers we should have in various categories. The State would then give a district $56,902 of funding per teacher, adjusted by the "Education Challenge Factor," which is essentially another measure of how affluent a district might be. Our ECF was .98509, meaning that the State's contribution would be adjusted to  $56,902 x .98509 = $56,054.

This $56,054 is supposed to cover both compensation and benefits. In our district, the average teacher compensation is $69,369 plus 35% in benefits, or $93,648. So the EBM would cover only 60% of the cost of one of our teachers. The other 40% was our local contribution beyond the State funding.

Of course, Gov. Strickland's EBM was never fully funded, nor was the system it replaced. In the case of Hilliard Schools, and most school districts like ours, the changeover from one system to the next had virtually no impact on the amount of funding we received from the State, due to the effects of the so-called Transitional Aid Guarantee.

Any change in the school funding algorithm creates winners and losers. Since the objective of such a change is always to get more money to the poorest of Ohio's school districts, the winners are usually those districts while the losers are districts like ours. The Transitional Aid Guarantee came to be to prevent there being any such losers - a matter of political expediency rather than good policy.

So if 80-90% of the spending in a school district is on compensation and benefits, is there any data which helps us figure out how many folks we need on staff, and what we should pay them?

How about if we go back to the philosophy of the Empirical (Augenblick) Method, which was the approach used from the early 1990s until it was replaced by Strickland's OEBM in FY2010?  Only this time, let's use only the 81 districts rated as "Excellent with Distinction" in 2009 as the sample set.

The Augenblick Method is to list the per-student spending of the school districts in the sample set, throw out the lowest and highest 5% or so to eliminate outliers, then average the rest. With this algorithm and using 2010 per student spending from the CUPP report, we get $10,026/student as the benchmark number, .

In other words, we don't know how exactly a district should or would spend the money, but it seems like with $10,026/student, any district should be able to achieve a rating of "Excellent with Distinction."

Yet the actual range is quite large. Throwing out the 4 high and 4 low districts (5%), the per-student spending still ranges from $14,733 at Sycamore Schools (Hamilton County) to $7,949 in Wausean Schools (Fulton County). So why can't Sycamore Schools get the job done at $8,000/student/year like Wausean - close to half the cost?

As said before, it's all about how many people the school district employs, and what they are paid.

At Sycamore, the ratio of Regular Education Teachers to Pupils is 17/1. At Wausean, it's 21/1. The average Wausean teacher has 24% more students in the classroom than a Sycamore teacher, yet they both achieve the same rating. So do the Wausean teachers get paid more for achieving the same result while having larger classes?

The average teacher salary in Sycamore is $71,137, while in Wausean it's $55,668, meaning Wausean teachers have 24% more students in their classes than Sycamore teachers, but get paid 22% less. So it's not class size or teacher comp which determines the rating on the State Report Card.

How about teacher experience?  The CUPP report gives the percentage of teachers with 0-4 years of experience, 4-10 years, and 10 or more years. For Wausean, those statistics are 14%, 19% and 67%, respectively. For Sycamore, it's 14%, 17% and 69% - nearly identical, and both skewed to the higher experience band. That would certainly suggest that experience makes a difference in terms of results, but doesn't explain compensation differences between districts (Hilliard's numbers are 12%, 22% and 66%).

I should stop here and remind folks that correlations are not the same thing as "cause and effect," and that merits remembering here. There are within this dataset school districts which achieve Excellent with Distinction yet have fewer than 25% of their teachers with 10+ years of experience. Twinsburg for example achieves this rating while having 60% of its teachers with 0-4 years of experience.

So is there anything we measure which seems to be a strong predictor of outcome? I'd suggest that there is, at least within the constraints of the data published in the CUPP report. That predictor is the level of poverty in a school district. Among the 81 Excellent w/ Distinction districts, the average and median number of students living in poverty conditions is 22% (stdev=13). As poverty goes up, performance goes down, and it doesn't matter that much what the per-student spending might be.

For example, Columbus City Schools spends $14,904 per student, second in our area only to Grandview Heights, which spends just $74/student more. Yet the Performance Index for Columbus City Schools is only 80 (2009 data) vs Hilliard's 101.5, which we achieve while spending $3,400/student (23%) less. The difference: 80% of Columbus kids live in poverty, while 21% of ours do (I suspect that number is surprising large to many in our community).

So how do we determine how many folks we employ in our school district, and what we pay them?

The best answer I can come up with is that it's all a matter of local choice.

Across Ohio, teachers are paid according to what their local union negotiates with the local school board, and it seems clear to me that local school boards in more affluent communities tend to settle the labor contracts at higher salaries than do those in less affluent communities. That's about it.

So it behooves a young teacher to get hired in an affluent district like ours, or one of the many suburban districts around Ohio. Presumably those districts can be very selective in their hiring, so only the most promising young teachers get a job. In our district, new fulltime teachers typically serve as substitutes for a year or more before being hired. It's an effective way to give them a 'try-out' before being invited to join the team, and I've been impressed with the new crop every year when we get to meet them. It must be a valued opportunity, as we have literally thousands of applicants each year for dozens of openings.

Does that mean the tens of thousands of teachers in the less affluent districts are all duds, because they couldn't find jobs in districts like ours?  Certainly not!  Many things will cause a young teacher to live in a less affluent community: family, spouse's job, lifestyle preferences, etc. And there are districts that achieve Excellent w/ Distinction in spite of having very low teacher salaries. Bloomfield-Mespo (Trumbull) is such an example, with an average teacher salary of $37,751, less than the starting salary in our district of $38,362.

And the 'how many' part of the equation is a matter of local choice as well. We choose locally the overall student-teacher ratio. We decide locally the breadth of programming we wish to offer, and how those programs will be staffed.

You may respond that YOU don't get to make those decisions. But that's a cop out. You elect the school board members, and you should hold us accountable for making decisions consistent with your wishes, understanding that there will never be 100% agreement on anything about anything.

Your input makes a difference. Input from a lot of you makes a big difference, and can change the direction of important decisions. We've seen that a couple of times this year.

It will seem like we're entering a 'quiet' time right now. We have a workable agreement with the teachers and support staff through 2013. With your passage of the levy, we are committed to not putting another levy on the ballot before 2014 - provided the State doesn't hammer us with another significant funding cut.

Indeed we can take a little breather. But I feel strongly that we soon need to start the community education and communications effort to prepare us for 2013, when we'll next be negotiating with the teachers and support staff, and for 2014, when we'll be voting on the levy to fund that new contract.

The basics of school economics aren't difficult to understand, but we have lots of people to educate.

11 comments:

  1. I think most people who have seen the Buckeye Institute report of teacher salaries believe teachers are overpaid, but what happens is that generally those with the time, energy and intelligence to run for school board are well off and thus that skews what the board thinks is a fair salary. To use two examples, Heather Keck, a lawyer, certainly isn't hurting for money and neither are you. That said, Justin Gardner, whatever his monetary situation, truly did seem to understand that teachers are overpaid and yet he lost, so we do get the leadership we deserve.

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  2. My friend Marc Schare, President of the Worthington School Board, has perhaps the best observation about teacher compensation. He says: "Some are paid too much, and some aren't paid enough, and neither problem can be fixed under the current system."

    Nor will an ill-conceived and poorly-implemented merit pay system fix the problem.

    I don't know whether to be complimented or insulted by your remarks. But I'll suggest that financial status has less influence over being elected to school board than does endorsement by the teachers' union and name recognition.

    You can buy name recognition with money, but it would take a lot. During the 2009 campaign, my running mates (Justin and Don Roberts) and I spent a small amount of money on a website, yard signs, flyers and a couple of 1/2 page ads in the local newspapers. We don't know which of these had the most impact, or whether they had any impact at all (my suspicions is that the flyers were the most impactful).

    I've fond of the marketing adage which goes: "Half of all advertising dollars are wasted - we just don't know which half."

    Mostly what it takes is hard work, by both the candidate and supporters. The three of us hit the streets pretty hard for a few months, starting with the 4th of July Parade.

    When a candidate gets the endorsement of the teachers' union, it automatically means the 1,000 members of the HEA - plus their families - hear about these candidates, and are encouraged to vote for them. Granted, not all the HEA members live in our school district, but many do, so their endorsement is quite valuable. The union will also do 'literature drops' on behalf of their endorsed candidates, putting thousands of campaign flyers in the hands of voters.

    And don't dismiss the influence voters can have on sitting Board members. We certainly took notice of the many people who came forward about athletics and gifted programs.

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  3. Something you have often said is that the majority of district spending should be spent on teacher salary since they are the one's doing the actual work of educating the kids. I agree, to a point. I don't think "majority" should be 88%. But putting that aside for a moment, let's talk about the fact that student poverty rates effect the school rating. As you said, when the poverty rate goes up, performance goes down. Maybe the district needs to look at spending money in different ways. Our PTO started a program to get school supplies to families in need. Maybe that is something the district should consider doing too. As far as "bang for the buck", $20 spent to provide a child with supplies for a year would have a bigger impact than just about anything else you could do with $20. The district is fond of telling us that they are part of the community. What that seems to mean is that they are part of the community because we go to them. Except for rare occasions, it doesn't seem to mean the district wants to step up and make contributions to any other community initiatives. (And contributions don't have to be monetary!)

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  4. One aspect of this problem that strikes me every time the issues of funding and performance come up is that we've got issues and solutions that we're trying to apply at a macro level, but these issues aren't (generally) macro issues.

    No matter how our State funds education, the performance of our school district depends highly on local administration, and no matter how our district performs on average, the education of any specific child is going to depend hugely on the individual teachers working with that child, and on the involvement and guidance of the parents.

    As a society, we usually look across all our citizens and decide that everyone has a right to at least some minimum opportunity, no matter what. For our purposes, we can consider "everyone" to be citizens of the State of Ohio, or of the Hilliard School District, and I think it's in our collective best interest to make sure that kids have a chance to improve themselves regardless of their circumstances.

    But the performance of individual kids is going to vary hugely across any given population, and there are all sorts of factors that contribute to that. You're going to have individual kids that excel in lots of environments, and others that are real handfuls almost anywhere they go. Some kids come from great family environments; others from some pretty horrendous ones. Individual teachers vary in ability and (maybe just as importantly) style, such that a teacher might be better-suited to reach one kid vs. the next.

    As a parent, I'd like to see a school environment where everyone has a chance to succeed, but I also want to be able to participate in making decisions about my child's education. That might take the form of picking a school or curriculum. That might take the form of expressing concern (and seeing action) if a disruptive child is interrupting the classroom on a regular basis (such that everyone's education is compromised).

    To some extent, I think that some form of voucher system is a step in this direction, but I'd like to see it go even further. I'd like to see parents be able to participate individually in choosing the classes that kids attend. I expect that school administrators shudder at the thought of parents being able to request specific teachers for their kids, but what a powerful feedback mechanism that would be! If you've got two or three third-grade teachers and there's one that nobody's picking, perhaps that's a clue. How about a system that incorporates parents' feedback into rating and compensation for teachers and administrators? Just like the BCS, you could make that just one part of an overall formula, but for parents that are trying to be involved in their kids' educations, I think this would be a meaningful way to communicate positively *or* negatively.

    Finally, since I truly believe that parental involvement still may be the single biggest factor in educational success, if we really want to raise the bar for our kids across the board, I'd like to see some of the money our community seems to find between the couch cushions when it's time to run ads about levies used to promote involvement by parents. It's not fair to the kids to have parents completely disengaged in their kids' educations. Education has to be a partnership among kids, parents, and our schools, or it's just not going to go anywhere over the long run.

    Clearly, the danger of depending on parents' involvement is that kids whose parents aren't involved for whatever reason aren't going to be able to take maximum advantage of the system. Although this sounds scary, I believe this is already happening. As a society, we've been outsourcing our kids' educations for so long now that we seem to have forgotten our parental obligations, and I truly believe that changing that mindset also has to be part of the solution.

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  5. Thanks for your comment.

    Folks much smarter than me have for decades tried to figure out how to neutralize the effect of poverty on kids' education. I think the program your PTO has done to help kids pay for supplies is admirable and no doubt helpful.

    But often the deeper impact of poverty on kids comes from the fact that a family in poverty often has undereducated parents who can't be much of a help or an example. My family certainly didn't have much in the way of financial resources, but my siblings and I were blessed to have two parents in the home, both of whom came from families where education was valued. Their use of proper grammar alone was a huge gift.

    I've done some tutoring at one of the Columbus inner city elementary schools, where fewer than 50% of the parents have graduated from high school. There may not be a book in their homes, but many have video games.

    This is a not-so-easy battle to fight. A century ago, not so many parents had graduated from high school either. But over the next two generations, they made sure their kids got an education, and American industry found ways to put that educated workforce to work.

    I'm not so sure the young uneducated parents of today have the same motivation to see that their kids get a good education. That's a generalization of course, and therefore wrong in many specific instances. But so many of the kids in poverty these days seem to be being led to a path of dependency on the public assistance programs rather one of education and financial independence.

    It's clear that one of the reasons we need so many intervention teachers and the like in our schools is that without them, many more kids would fail in school, perpetuating the problem into another generation.

    This just isn't one of those problems that can be solved with money. Money helps - like the program your PTO does. But what it really takes in one-on-one time with these kids.

    My friend Tyler Flynn started the Franklinton Tutoring Program a number of years ago. Adults from the area spend one lunch hour each week helping 2nd and 3rd graders with their reading.

    I worked with a kid for two years, and during that period his reading skills improved from not being able to read at all, to catching up with with his grade level. Certainly the credit goes mostly to his primary teacher, as well as his reading intervention teacher, but the stats show that the kids in this program progess faster than their peers who do not participate. But there just aren't enough volunteer tutors.

    A couple of years ago, I was invited by one of the Hilliard elementary teachers to volunteer in her classroom, and this is now my third year doing so. Once/week, I have the opportunity to help one, or a small group of kids catch up on something giving them some challenges.

    I recognize that I'm blessed with the time to do this, and not everyone is. But what if we could replicate Tyler Flynn's program in Hilliard? Are there adults who would give up one lunch hour each week to help a struggling kid?

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  6. Thanks David - my comment above was in response to Anonymous, but clearly you and I were thinking along the same lines.

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  7. One of the key arguments put forward by the opposition to Senate Bill 5 was that SB5 prevented public workers from bargaining staffing levels, as though defeating SB5 would prevent any future layoffs.

    The reality is that you can't make a local government - and that includes school districts - spend money it doesn't have. So when the community votes down a levy, the typical recourse is to lay off workers.

    Today, the Columbus Dispatch published a story about how one of the most respected and affluent school districts in our region - Dublin City Schools - was going to do exactly that, cutting on the order of 100 jobs.

    That's because compensation/benefits is where nearly 90% of the money is spent in a school district, and there's no way to take millions of dollars out of a spending plan without cutting labor costs.

    Dublin spends about $157 million/yr on compensation and benefits. Another possible answer to their need to spend $7m less over the next two years (the amount their projected FY14 cash balance is negative) is for everyone to take a 2.2% pay cut.

    What prevents them from exploring this option?

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  8. Paul, a pay cut is a dirty word, and really this has nothing to do with Sentate Bill 5 This is about the control of the schools and the continued paradigm

    So we start as usual, Ed Association in each district is very powerful, they endorse Board candidates that will vote with them. They have a huge warchest to spend. As they also vote with friends and family, they hold a big voting block.
    They and the district then solicit big money for levy campaigns from vendors, contruction co. banks etc. HOw does average community member combat this.
    They cannot.

    The community gets labled as uncaring, against the kids, while at the same time we have work to the contrACT actions that hurt the kids, but not one
    comingment, not one apology from the board.

    How are we going to try to get an adjustment downward when the supplemental contracts are totally out of control. 4 wrestling coaches at Davidson, multiple weight room personnel ??
    Paying for after school activities to the max.

    We have4 members of our board endorsed by the HEA
    andnothing is going to be done except a new levy in two to three years. Meanwhile, the community members are forced in the real marketplace with paycuts,no pay raises, no step raises, Medical contributions in double digit increases and we get excited that a single employee now pays 50.00 per month, for medical premium and free dental and the pick up on deductible besides.

    No one is going to touch this, so the best other option might just be HB136 which I have issues with
    on a number of fronts but might just give the individual parent , guardian et al more control
    and if enough people leave perhaps the boards might listen.

    Remember, Paul, your amendment drew zero discussion from your fellow board members.

    More of the same, more of the same, more of the same
    just pass another levy every 2 to 3 years. And then the board and district tells us we are at a bare bones education level on funding. Insulting
    but (sigh) reality

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  9. Paul, based on your analysis, it seems that it might be reasonable for the voters in our district to decide that we are over-funding the schools and under-funding the families in poverty that have children in our schools.

    It seems as though statistically, we are just as likely to maintain our overall district rating even if we cut our spending per student on schools, if we can maintain or lower our percentage of students living in poverty.

    As you point out, however, it is unclear what specific help we could provide to such families that would help raise the achievements of their students. Even if we could, simply giving them enough money to raise their incomes above the poverty line is not likely to raise student achievement. Poverty may not be a cause, but a symptom just like poor academic performance of the children in those families. It may be, as you suggest, the education level of the parents, or some other factor that results in poverty, and not the poverty itself that results in poor academic performance.

    In various comments, you mention tutoring programs for under-performing students. I wonder if some intervention might be appropriate for the families as well, to help them understand how they can best support their students (providing a quiet area and time period for the student to do homework, for example) and encourage academic achievement. Helping the students might be easier and more effective if we helped the parents as well, possibly using some partnership between educators, social workers, and volunteers.

    I realize to some this might sound like advocating for yet another government program, but if it can provide lower the overall cost for good academic outcomes, it might be worth considering. It might be most effective if it existed under the auspices of the school system, rather than some government agency that might have less focus on the specific outcome we would be trying to achieve. We could choose to hire a couple of social workers (at the cost of a teacher or two) for a pilot program. Do you know if any other districts have tried such an approach? There's no sense reinventing the wheel if someone else has succeeded with such an approach could give us a blueprint to work from. Or perhaps there are enough examples of this being tried unsuccessfully that we could reasonably assume that it isn't worth trying here.

    Regardless of all that, the conclusion you reach seems to be that we could lower our level of school funding WITHOUT hurting our Excellent with Distinction rating. Or am I reading too much into what you wrote?

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  10. Mark: Thanks as always for the thoughtful comments.

    Could we lower our funding and not hurt our Excellent with Distinction rating?

    Not my point. Rather, I'm trying to decouple performance from spending. Affluent communities tend to spend more on their school districts because they can, not because increased spending necessarily leads to better results.

    The retail community has known this kind of thing for a long time. A good friend was for many years an accounting executive with Lazarus. She told us never to shop at the Kingsdale store because the prices were materially higher there than on identical items available in the other Lazarus stores in the area (Westland had some of the best prices back then).

    Why? Because Lazarus knew that there were a fair number of folks in Upper Arlington who would willingly pay a higher price to shop in their own neighborhood (with their affluent neighbors?). So why leave money on the table?

    Folks in affluent school districts tend to pay their teachers and staff more because the voters tolerate paying higher taxes in order to avoid the pain of a teachers' strike or severe program cutbacks.

    Not very many communities figure out how to deal with things when that limit is reached however. South Western didn't, and ended up cancelling their extracurricular programs a couple of years ago. Westerville, is dealing with this situation right now.

    And let's not forget that our community barely avoided the same situation, passing a levy by the narrowest of margins.

    We're going to be right back in the same place in a couple of years if we don't find a different way of processing all this economic stuff.

    But that's not going to happen until many more folks in our community decide to make the effort to understand how these fundamental economic relationships work, and then engage in a dialog to determine our long term economic strategy (spending vs funding).

    We certainly had no problem getting a large number of people fired up when it looked like we might have to cancel extracurricular activities. Parents with high school athletes in particular were freaked out that the sports program would come apart before their kids graduated.

    What if the school board said we were going to eliminate extracurricular activities starting in 2014? Who would be showing up at the school board meetings then?

    That's who we need to engage.

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  11. Interesting commentary on Judge Rappaport's decision from the Fordham Institute

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