School Finance

Two-thirds of schools in the UK were closed for a day recently as
teachers went on strike over proposed changes to pensions. Unions are
trying to force the government’s hand during negotiations over
contributions to the pension system, which has become unaffordable
(there as here in the US) due to rising life expectancy and rules that
permit retirement as early as 55.

The UK’s schools minister, Nick Gibb, didn’t mince words in condemning the strike:

Mr Gibb said: “Strikes benefit no-one – they will disrupt
pupils’ education, hugely inconvenience parents, and damage teachers’

“It’s irresponsible to strike while negotiations are ongoing. Many
parents will struggle to understand why schools are closed when the
pension deal on the table means that teachers will still be better
rewarded than the vast majority of workers in the private sector.

“Reforms to public sector pensions are essential – the status quo is
not an option. The cost to the taxpayer of teacher pensions is already
forecast to double from £5bn in 2006 to £10bn in 2016, and will carry
on rising rapidly as life expectancy continues to improve.


A major impediment to improving outcomes for disadvantaged children
in the nation’s schools is misallocation of the more than $600 billion
we spend annually on K-12 education. Marguerite Roza from CRPE and Cindy Brown from the Center for American Progress brought up this very point at our governance conference this morning. (Live feed is here if you want to tune in.)

The Department of Education just released a national study
(pdf) confirming with hard data what many experts have said for years:
rigid salary schedules established are a major source of inequity within
school districts. (It’s important to stress that this is not a
“loophole,” but a carefully structured policy embedded in most contracts
at the behest of teacher unions.) Here’s CAP’s Cindy Brown in the New York Times:

A few researchers have documented the problem with
statewide data in Florida and some other states, said Cynthia Brown, a
vice president at the Center for American Progress,
a liberal research group. “But I’m excited because this is the first
time that data documenting the problem has ever been collected


moolah photo

It's my money; I'll do what I want.
Photo by sushi♥ina

Do well-heeled parents have the right to heap donations
on their students’ public schools to pay for teacher aids, extra library hours,
or a media lab? Of course—though, as the Los
Angeles Times
explains, expect a fight. This week’s example comes from the
Santa Monica-Malibu Unified School District, where the PTA at one Malibu
elementary school adds over $2,100 per pupil to the school’s coffers compared
with a mere $96 raised at another district elementary twenty miles down the
road. The school board is mulling a plan to centralize all PTA donations,
allowing for more equitable student funding. Our position on school financing
is clear: Funding formulas should include weights that ensure that more public
resources be allotted to higher-need students. But, when it comes to private
dollars, districts and states should tread carefully. If parents want to donate
more, so be it. Barring...

Zachary Janowski at the Yankee Institute has an interesting take on school efficiency in Hartford, CT:

Ten Connecticut school districts can produce two high
school graduates for the price of one Hartford high school diploma,
according to Department of Education data.

The most recent 13 years of education, representing kindergarten through 12th grade, cost $165,275 in Hartford. With a graduation rate of 69.3 percent, the cost per diploma in Hartford is $238,492.

In 2010, Hartford’s costs were less than double the costs of the most efficient school districts.

Presumably, students who drop out gain some benefits from
their schooling, even if they don’t receive a degree. But a partial high
school education is not much of an asset in the labor market relative
to completion of a rigorous secondary program and vocational training.
This analysis reveals just how much of Hartford’s K-12 investment is
being squandered for likely little gain in outcomes for kids who don’t
make it to graduation day.

The Yankee Institute’s analysis reveals an important side of the
“doing more with less” coin: Schools that can deliver higher quality and
better outcomes for the same...

Protestors on UC campuses in California are focusing attention on the rising cost of higher education
in the state’s public university system, which has seen cuts in state
support of over a billion dollars. A Berkeley administrator sums up the

“The rapidly rising fees give us all heartburn,” said
Gibor Basri, the vice chancellor for equity and inclusion at Berkeley,
who has met with the protesters several times. “We don’t believe that
higher education is a private right but a public good.”

The funding challenge in higher ed has implications for K-12 spending
as well. Society has a responsibility to fund education — both to
provide equality of opportunity for all children and to develop human
capital for the improvement of civic life and our economy. But what to
do when taxpayers have already provided massive increases in funding
after inflation over a sustained period, as they have for K-12 over the
past several decades?

We can’t afford to focus only on the revenue side of the equation
anymore if our goal is to ensure that quality education remains a public
good. Just...

Andrew Boy
Founder and executive director of Columbus Collegiate Academy

Guest blogger Andrew Boy is the founder and executive director of Columbus Collegiate Academy (CCA), a Fordham-authorized middle school serving students in grades six through eight.

As school levies fail across central Ohio, I am concerned and
disappointed to see so many school districts quickly threaten to reduce
the quality of our children’s education. Providing an excellent
education for our children may be the single most important thing we
can do as responsible citizens.

give hope to our children in tough economic times, we must learn to do
more with less. When I read the statement made by Westerville’s
school-board president, “We’ll be looking at state-minimum
requirements,” I lost confidence in the leadership of the district in
which I live. As the operator of the Columbus Collegiate Academy, a
charter school on the Near East Side, I run a school on a shoestring
budget. Unlike traditional district schools, we don’t have access to
local property-tax dollars.

When I see levies on the ballot, I can only dream about what we
could do for our students, 94 percent of whom are minorities and 88

Last night, Rhode Island’s legislature passed a sweeping reform of its public-sector retirement system.
It cuts retiree benefits, mostly by suspending cost of living
adjustments, and institutes a cheaper hybrid plan with a 401(k)-like
private account component, and it should save taxpayers billions of
dollars in coming years.

Far-reaching as the bill is, however, this outcome is something of a
failure, good only by comparison to the tragedy that would have ensued
had lawmakers done nothing. Rhode Island waited until it was on the cusp
of disaster to make desperately needed changes. By comparison, Utah’s
reform, described in our recent series of case studies,
came about because lawmakers were thinking years into the future about
the risk pension shortfalls presented. They gathered support for changes
to the retirement system to head off a crisis before it became

The short-sightedness of the Ocean State shouldn’t be called
“courageous” simply because Rhode Island changed course at the last
possible moment to avert disaster. The state may provide a model for
other profligate jurisdictions like Illinois, showing them that change
is possible and following...

We are going to see increasing in-fighting among big government types
as big-spending school districts compete for resources with the rest of
the agenda supported by the public fisc. Schools are increasingly going
to lose those battles, which they’re not used to. Today’s example comes
from Montgomery County, Maryland, where I live.

Democrats on the county council have been butting heads with the
school board for months over skyrocketing education budgets, culminating
in a battle to repeal Maryland’s maintenance of effort requirement:

But the details of Maryland’s maintenance of effort law
have proved unwieldy in tough budget times. Its authors never
anticipated a housing bubble nor articulated a logical process for
working through it.

The debate has largely played out in Montgomery County. The county’s
nationally recognized schools have long been a generously protected
fiscal priority, and the county council exceeded minimum spending levels
by hundreds of millions of dollars over the past decade. When the
budget outlook worsened, though, the county council said it couldn’t
maintain the same level of investment.

“The county government was hurt by the fact that we were doing over


This soapbox has a great view

Mike and Janie bite off big topics in this
week’s podcast—from the repeal of SB5 to racial imbalances in gifted-ed
programs to online learning. Amber wants CRPE to name names and Chris starts
subbing for the pension benefits. You’re gonna want to sit down for this.

Illinois may finally be addressing its dysfunctional teacher retirement system with meaningful, bipartisan reform:

The sweeping pension changes, presented by House
Republican Leader Tom Cross and Democratic Speaker Michael Madigan,
would establish three retirement options for government workers to
choose from going forward. State employees could keep their retirement
benefit in place but pay more; take smaller benefits but pay no more;
or set up a 401(k)-style plan that would give employees more control of
their investments but also see them roll the dice on the markets.

I’ve made no secret
of how little I think of last year’s “reform” in Illinois, which simply
took money out of the pockets of young teachers to make up for the bad
choices made by legislators and unions. This is a much better start, and it’s cheering that the Democratic leadership is on board.

Labor doesn’t like it, with the Illinois AFL-CIO’s president claiming
this measure would reform the pension system “on the backs of working
families.” But working people are going to be hurt no matter what, since
the retirement system is in terrible fiscal shape. The...