Friday, July 20, 2007

Merging Districts -- Real World vs. Theory

The Mackinac Center, a well-respected Michigan think tank, released the report, “School District Consolidation, Size and Spending: an Evaluation” by Andrew Coulson. (I wrote about it in a blog found here, and their full report can be found by clicking here.)

The report attempts to use data to determine whether merging districts would save money, and concludes it would not.

But their reasoning warrants a closer look because it views districts from a theoretical, one-size-fits-all perspective. Suburban and rural school districts are the proverbial apple and orange, and this approach is akin to throwing them into a blender in an effort to determine which is the ideal fruit.

The concern is that those who seek to preserve the real-world, administratively top-heavy status quo
may abuse these theoretical findings. It’ll make things tougher for those of us in the trenches attempting to encourage districts to investigate and pursue efficiency.

The report uses complex mathematical formulas to “debunk the myth” that merging school districts saves money, suggesting instead that dividing up the state into districts of 2911 pupils would save Michigan $363 million per year.

This defies common sense.

Larger districts create economies of scale in purchasing, and could realize cost reductions by eliminating the duplicated administrative overhead existing between adjacent suburban districts.

And while merging smaller rural districts may yield little or no savings, pooling resources may create opportunities to enrich education with planning and curriculum development services currently missing in smaller districts. The report highlights this potential expansion of staff as a cost concern, but that concern is misplaced because Proposal A prevents districts from increasing taxes to expand staff.

Sadly, no attempt is made to identify where mergers might make sense. Instead, all districts statewide are lumped together, causing input data to be heavily weighted with small rural districts. These rural districts – which comprise the majority of Michigan’s 550 districts – are not only smaller, but spend far less per pupil than their larger suburban counterparts.

Viewed from a purely mathematical standpoint, a district of 2911 students might appear fiscally ideal on paper. But such districts oftentimes don’t employ professionals whose expertise guides curriculum development, assessments, and technology. They’re simply too small to afford them.

In reality, adding such positions might help improve student achievement in those smaller districts, which on average score lower on MEAP assessments. Statewide, districts with less than 3000 pupils – the report’s optimum size – have the lowest MEAP math scores (excluding the City of Detroit).

Lagging achievement cannot be blamed on district size alone, and this report correctly notes there’s no correlation between spending and achievement. But achievement should be our schools’ primary goal, and it’s unbelievable that achievement wasn’t considered in the study. Perhaps the results would’ve been different if they were.

Actually, the more appropriate question to answer would be, “What district size produces the best academic results in the most cost effective way?”

That question might’ve directed attention toward a larger district like Utica Community Schools in Macomb County. The state’s second largest district, – at nearly 30,000 pupils – spends merely 2.5 percent more per pupil than the average sub-3000 student district. Yet Utica’s 8th grade MEAP scores in math are 15.5 percent higher, and their ACT scores and Advanced Placement exam participation rates are notably higher too.

The Utica example, while statistically insignificant, shouldn’t be summarily dismissed. Consider how their model might be applied in Oakland County, with 28 school districts ranging in size from 1,500 to over 15,000 students.

Details are unavailable on the precise the number of central office administrators in Oakland County, but a review of district websites suggests smaller districts have a 500 to 1 ratio of students to administrators, medium sized-districts are 750 to 1, and larger districts are 1000 to 1. It follows that there may be 270 administrators in Oakland County, presumably costing taxpayers – with benefits and retirement – at least $38 million per year. Many of them do the identical work of their counterparts in neighboring districts.

But merging into five new districts of 40,000 students each, and using the administrative structure of Utica as a model could eliminate this duplicated administrative overhead. Utica’s student-to-administrator ratio appears to be approximately 1500 to 1, which if applied here would project a need for 26 administrators per district, or 130 administrators in Oakland County.

This represents less than half the number of current administrators, and the savings could return $100 per pupil to the classroom. Incidentally, this doesn’t consider savings resulting from merging services, pooling purchases, etc., nor does it entail closing or merging a single school.

District mergers are not some panacea. The Mackinac Center correctly notes, “… neither mergers nor consolidations are likely to bring about dramatic reductions” in state spending. The potential savings proposed here are relatively small when compared to the nearly $2 billion spent on education in Oakland County.

But every percent of savings is meaningful to taxpayers, and more importantly to our children.


Anonymous said...

Again the details are missing here.

What about the local parents, voters, and tax payers?

How do you propose to get them to do this?

Many districts such as Avondale have let you know that they have absolutely NO intent in being "swollowed" up by another district. At least that is how they see it.

So now you have a huge campaign and tons of spending just to sell this idea.

The school boards will follow public will. How will you change the public?

Or will you propose more BIG government and get Lansing to ram this down our throats?

john said...

Of course schoold districts would say they do not want to be "swallowed" up by larger schoold districts. The administrators (overhead, not in a classroom) do the speaking and their minimization is where the efficiency gains will come from. School district merger with its minimization of overhead is absolutely the right thing to do.

A Conservative Teacher said...

Efficincy and economies of scale are useful for businesses responding to market forces and having the information of prices at its disposal, but whenever efficiency and economies of scale are applied to political problems (like school districts), you have to be very careful that it doesn't turn into tyranny.

Control of districts should be left at the local level, and every attempt should be made to return more and more control over education to the local level. Any attempt to centralize school districts and make larger and larger districts will only result in the increasing control of the state in education affairs and the logical dumbing down of education that usually follows increasing state control.

Don't fall for the charm of efficiency- it is a myth, but in the real world, all it will lead to is larger and larger centralized administrations located at farther and farther distances from the people, and lower the quality of education in our society.