Wednesday, February 7, 2007

District Consolidation Incentives - Show Me the Money!

Michigan's Governor Granhom gave her State of the State Speech on February 6, 2007.

The full text can be found here:

The Detroit News: Full Text of Granholm's State of the State (02/07/06)

Here's a quote that shows she's onto something... but should've been more prepared.

Early in the speech she talks about the excessive number of local goverments (cities, townships, etc), and encourages them to consolidate and share services. She then moves into talking about schools:

"It’s simple. When they show us they’re consolidating or sharing, we’ll “show them the money.”

We will also ask our school districts to cut costs by consolidating services at the county or regional level.

My budget proposal will include incentives for districts to consolidate their business services in the coming school year.

A year from now, I’ll submit a budget that will penalize those who haven’t embraced this common sense way to put more dollars in the classroom. For example, it just doesn’t make sense to have 10 school districts in a single county buying separate software when they can save dollars and cents buying it together.

Consolidation of services makes sense, and it saves money. And whether it’s by using a carrot or a stick, we are going to make it happen."

--- Governor Jennifer Granholm

I have been an advocate of district consolidations or mergers for some time, as shown by the opinion pieces I wrote as early as 2004. Most people that look at the issue -- except for most school boards and most district administrators -- seem to see the value and potential.

It's great to see the Governor jump on the bandwagon.

But, I'm worried that revealing her idea without a firm plan may hurt more than it will help.

First of all, anyone that might currently be thinking about consolidating or sharing services is likely to put all plans on hold until the plan is revealed and passed. After all, it wouldn't be very smart to consumate a deal only to find out that waiting would've rewarded you with an incentive from the government.

And, this incentive plan will now serve as a rallying cry to everyone opposed to significant consolidation efforts. How can legislators even consider trying to force the issue now? The response will be, "Let's give the incentives a chance."

That would be fine if we had time, but do we?

And where are we going to get the money for any significant incentives?

I think it's unlikely that the government will be able to effectively define a meaningful consolidation of services. It's hard to see where they will be able to offer much in the way of incentives. And, it's unlikely that they will be able to do it quickly.

Consolidation seems to hold a lot of promise. Districts could see significant savings without a reducation in service. But school boards and district administrators, whose positions and jobs would be the first to go, are not likely to advocate for or effectively market the ideas. It needs to happen higher up the food chain.

Maybe a direct approach is best. The incentive could go to districts that publicy identify and begin discussions with a potential merger partner before the 2007-08 school year begins, and the penalty in the 2008-09 year would be a reduction in funding if you don't go through with it!

In the end, the most plausable scenario is that the government will devise small incentives that will entice districts to dabble in sharing services.

I guess baby steps are better than nothing, but it sure not the kind of bold leadership we need!

==> Mike

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