The Efficiency Smokescreen, “Cuts Cause no Harm” Argument & The 3 Kansas Judges who Saw Right Through It!

State school finance litigation is a tedious – often annoying –politically charged process.  Often, school finance litigation involves extensive debate over tedious statistical and other details underlying estimates of how much is should cost for states to meet their constitutional obligations. Too often, it seems, these debates over tedious statistical details serve to distract the conversation from broader principles of plainly logical fair treatment for kids.

In these cases, states continue to vigorously defend their right to fund – or not – schools as they see fit… when they see fit…. whether or not they see fit.  A relatively consistent pool of experts continue to advise states on strategies for their defense. These strategies have evolved somewhat over time.  For many years, the central “expert” strategy was simply to argue that there’s no proof that adding more money would matter anyway because there is no systematic relationship between funding and outcomes. Of course, this argument fails to excuse the facial inequity of permitting some children in some districts to have twice or more, the resources of others. But, defense experts have certainly extended the money doesn’t matter argument to support the contention that because money is inconsequential, so too are these inequities.

More nuanced versions of these arguments have emerged in recent years.  Bringing “efficiency” arguments into the debate, defense experts have taken to helping states build their central theory on the argument that all districts have more than enough money, even those with the least, and that if they simply used that money in the most efficient way, we could see that it is more than adequate. The extension of this argument is that therefore, even cutting funding to these schools would not cause harm and does not compromise the adequacy of their funding, if they take advantage of these cuts to improve efficiency.  This argument is then coupled with challenges to any and all attempts to estimate the “cost” of producing adequate outcomes based on existing practices of school districts – because existing practices are inefficient practices.  This is a nuanced and complex argument and one that I’ve addressed previously in academic writing and in this blog.

As I’ve stated previously:

Importantly, cost model estimates are estimates based on the actual production technologies of schooling. They are based on the outcomes schools and/or districts produce under different circumstances, for different children – the actual children they serve, based on the actual assessments given, and based on the real conditions under which children attend school. Some critics of education cost analysis in general, and cost function modeling in particular assert that all local public school districts are simply inefficient, mainly because they pay their personnel based on parameters not associated with improved student outcomes.[1] Therefore, they assert that it is useless to consider the spending practices of current districts when trying to determine how much needs to be spent to achieve desired outcomes. A common version of this argument goes that if schools/districts paid teachers based on test scores they produce and if schools/districts systematically dismissed ineffective teachers, productivity would increase dramatically and spending would decline. Thus, educational adequacy could be achieved at much lower cost, and therefore, estimating costs based on current conditions/practices is a meaningless endeavor.[2],[3]

The most significant problem with this logic is that there exists absolutely no empirical evidence to support it! It is entirely speculative, frequently based on the assertions that teacher workforce quality can be improved with no increase to average wages, simply by firing the bottom 5% each year and paying the rest based on the student test scores they produce.  To return to the car purchasing analogy above, this is like assuming that somewhere out there is a car/truck with all the features of the Escalade, but the price of the F-150 – specifically, a version of the Escalade itself produced by a new, yet to be discovered technology with materials not yet invented that allow that vehicle to be sold at less than 1/2 its original price.

In fact, the logical way to test these very assertions would be to permit or encourage some schools/districts to experiment with alternative compensation strategies, and other “reforms,” and to include these schools and districts among those employing other strategies (production technologies) in a cost function model, and see where they land along the curve. That is, do schools/districts that adopt these strategies land in a different location along the curve? Do they get the same outcomes with the same kids at much lower spending? In fact, some schools and districts do experiment with different strategies and those schools carry their relevant share of weight in any statewide cost model.

Pure speculation that some alternative educational delivery system would produce better outcomes at much lower expense is certainly no basis for making a judicial determination regarding constitutionality of existing funding, and is an unlikely (though not unheard of) basis for informing statewide mandates or legislation.  Cost model estimates, as well as recommendations of professional judgment and expert panels can serve to provide useful, meaningful information to guide the formulation of more rational, more equitable and more adequate state school finance systems.

In a Shawnee County District Court decision released on Friday, a three judge panel thoroughly impressed me with their understanding, and eloquent takedown of the efficiency & funding cuts smokescreen.

As the Kansas 3-Judge Panel Framed It: (p. 188)

If “value” is to be a determinative consideration in the evaluation of the costs of providing suitable education, which we concur it must be, then, nevertheless, we would have to believe the State would have some obligation in this proceeding to advance alternative measures that cost less, but which, at least, produce the same sustained effect in producing the “improvement in performance that reflects high academic standards” which now epitomizes the end measure for a “suitable education.” Here, the record is wholly devoid of such alternative approaches, by cost or otherwise, to that goal. Rather, here, the State has effectively asserted that all Kansas K-12 students have reached their apparent maximum and will continue to do so with less money. Here, it is clearly apparent, and, actually, not arguably subject to dispute, that the state’s assertion of a benign consequence of cutting school funding without a factual basis, either quantitatively or qualitatively , to justify the cuts is, but, at best, only based on an inference derived from defendant’s experts that such costs may possibly not produce the best value that can be achieved from the level of spending provided. This is simply not only a weak and factually tenuous premise, but one that seems likely to produce, if accepted, what could not be otherwise than characterized as sanctioning an unconscionable result within the context of the education system. Simply, school opportunities do not repeat themselves and when the opportunity for a formal education passes, then for most, it is most likely gone. We all know that the struggle for an income very often – too often – overcomes the time needed to prepare intellectually for a better one.

If the position advanced here is the State’s full position, it is experimenting with our children which have no recourse from a failure of the experiment.  Here, the legislative experiment with cutting funding has impacted Kansas children’s K-12 opportunity to learn for almost one-third of their k-12 educational experience (2009-10 through 2012-13). Further, given the increased performance results that have accrued after passage of the No Child Left Behind Act and the more focused attention to the increase in standards in the future, the failure to provide full opportunity for learning experiences in our Kansas K-12 school system in the past due to a shortfall in funding is truly sad, however, a continuation of the status quo would only deepen the reflection of opportunities lost. For past students and future students, “all that they can be” was, is currently, and will be, compromised.

See also:

Baker, B. D. (2012). Revisiting the Age-Old Question: Does Money Matter in Education?. Albert Shanker Institute.

Baker, B. D. (2011). Exploring the Sensitivity of Education Costs to Racial Composition of Schools and Race-Neutral Alternative Measures: A Cost Function Application to Missouri. Peabody Journal of Education, 86(1), 58-83.


[1]Hanushek, E. (2005, October). The alchemy of ‘costing out’ and adequate education. Paper presented at the Adequacy Lawsuits: Their Growing Impact on American Education conference, Cambridge, MA. Costrell, R., Hanushek, E., & Loeb, S. (2008). What do cost functions tell us about the cost of an adequate education? Peabody Journal of Education, 83, 198–223.

[2] For elaboration on this argument, see: Costrell, R., Hanushek, E., & Loeb, S. (2008). What do cost functions tell us about the cost of an adequate education? Peabody Journal of Education, 83, 198–223.

[3] An alternative version of this argument is presented by the “efficiency” intervenors in this case. Intervenors’ brief explains: “Therefore, it is literally impossible for the legislature or other current managers of the school system in Texas to take the position, in cost-effective economic terms, that any particular level of funding is necessary for efficiency. Even the question of allocation of funding among districts cannot be determined in an efficient manner without a more substantive and comprehensive system of financial accountability.” http://eduefficiency.org/wp-content/uploads/2012/02/2012-02-22-Plea-in-Intervention.pdf (p. 9) This comment would appear to be a backhanded attempt to undermine any use of analysis of existing spending data for addressing either the overall adequacy of funding to Texas school districts or the equitable distribution of that funding. But this argument suffers the same lack of substantiation that there actually exists some hypothetically more efficient system out there somewhere, and that the current system is necessarily so inefficient as to be irrelevant. The only reasonable basis for  the court to determine education costs in Texas, and how they vary across children and settings is to evaluate those costs in the context of policies as they currently exist, given the actual production of outcomes and average efficiency of schools and districts in producing those outcomes.  Reducing regulations may be a rational alternative, and re-estimating costs after such policy change is also reasonable. If costs of desired outcomes go down after such policy change, then great! But one cannot simply assume that regulatory change (or charter expansion as an approach to regulatory reduction – see Section 5.0) will result in dramatic efficiency gains.

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Do School Finance Reforms Make Any Difference?

Well… here’s what a number of reasonably strong empirical studies have shown…

•   David Card & A. Abigail Payne, School Finance Reform, The Distribution of School Spending, and the Distribution of Student Test Scores, 83 J. Pub. Econ. 49 (2002)
–    Using micro samples of SAT scores from this same period, we then test whether changes in spending inequality affect the gap in achievement between different family background groups. We find evidence that equalization of spending leads to a narrowing of test score outcomes across family background groups. (p. 49)
•    John Deke, A Study of the Impact of Public School Spending on Postsecondary Educational Attainment Using Statewide School District Financing in Kansas, 22 Econ. Educ. Rev. 275 (2003)
–    In this paper, I use a policy change in Kansas involving statewide school district refinancing to measure the impact of per-pupil spending on the probability that a student will choose to acquire more education. Using panel models that, if biased, are likely biased downward, I have a conservative estimate of the impact of a 20% increase in spending on the probability of going on to postsecondary education. The regression results show that such a spending increase raises that probability by approximately 5%.
•   Thomas Downes (2004) School Finance Reform and School Quality: Lessons from Vermont. In Yinger, J. (ed) Helping Children Left Behind: State Aid and the Pursuit of Educational Equity. Cambridge, MA: MIT Press.
–    All of the evidence cited in this paper supports the conclusion that Act 60 has dramatically reduced dispersion in education spending and has done this by weakening the link between spending and property wealth. Further, the regressions presented in this paper offer some evidence that student performance has become more equal in the post–Act 60 period. And no results support the conclusion that Act 60 has contributed to increased dispersion in performance. (p. 312)
•    Tom Downes, Jeffrey Zabel, Dana Ansel (2009) Incomplete Grade: Massachusetts Education Reform at 15. Boston, MA. MassINC.
–    The achievement gap notwithstanding, thisresearch provides new evidence that the state’s investment has had a clear and significant impact. The achievement gap notwithstanding, this research provides new evidence that the state’s investment has had a clear and significant impact. how education reform has been successful in raising the achievement of students in the previously low-spending districts.4  Quite simply, this comprehensive analysis documents that without Ed Reform the achievement gap would be larger than it is today. (p. 5)
•    Jonathan Guryan (2003) Does Money Matter? Estimates from Education Finance Reform in Massachusetts. Working Paper No. 8269. Cambridge, MA: National Bureau of Economic Research.
–    Using state aid formulas as instruments, I find that increases in per-pupil spending led to significant increases in math, reading, science, and social studies test scores for 4th- and 8th-grade students. The magnitudes imply a $1,000 increase in per-pupil spending leads to about a third to a half of a standard-deviation increase in average test scores. It is noted that the state aid driving the estimates is targeted to under-funded school districts, which may have atypical returns to additional expenditures.
•    Margaret Goertz & Michael Weiss (2008) Assessing Success in School Finance Litigation: The Case of New Jersey
–    State Assessments: The gap between Abbott districts and all other districts was reduced to 12 points by 2005 or 0.40 standard deviation units. The gap between the Abbott districts and the high wealth districts closed from 25 points to 15 points in 2005 (Figure 7). Performance in the low, middle, and high wealth districts essentially remained parallel during this time. (p. 17)
–    NAEP: The NAEP results confirm the changes we saw using state assessment data. NAEP scores in 4th grade reading and mathematics in Central Cities rose 19 and 20 points, respectively between the mid-1990s and 2005, a rate that was faster than either the Urban Fringe or the state as a whole. P. 20)

Another Lame Attempt by KS Legislators to Screw High Poverty Districts!

I’ve gotta give them some credit. The Kansas Legislature is getting more creative and arguably a little better at math over the years. But, the primary objective remains the same – find some way… any way… blatant or more preferably deceitful… to redirect funding allocated for higher poverty larger town and urban school districts to someone else… preferably the ‘burbs and when necessary, small rural districts.

Over the years, the Kansas legislature has come up with many angles to achieve this policy objective – like allocating “new facilities” weighted aid to suburban districts in amounts that for years dwarfed at risk and bilingual education aid to poor urban districts next door. Most recently, when legislators realized that the jig was up… and they at least had to call the aid, at risk aid, they concocted a scheme to shift some of the at risk aid, to “children who are not poor and do not live in poor districts but fail the state assessments.” Yes, failure based aid for the ‘burbs.  A brilliant solution.

Them Kansas Legislators have been convinced for years that them darn city liberal and minority folk are suckin’ the state budget dry by stickin’ a “poor kid” label on everyone they can find and even ones they can’t find – fudgin’ the numbers and gettin’ rich in the process. (this was part of the reason for the move to the non-poor failing child weight).

They’ve now come up with a new way to correct them-there-fudged-numbers. Okay… back to civilized speech.

HB 2357 proposes to base each district’s at risk funding on the lesser of the district’s actual at risk count or the district’s U.S. Census Poverty Rate times 2.37. The multiplier is, in theory (I’ve not seen their math), based on the idea that at risk counts are higher than census poverty rates because they are based on national school lunch program cut points for family income, which are at higher income thresholds.

The problem with using the same multiplier (2.37) for smaller and larger districts across the state is that the ratio of at risk children to census poverty tends to be higher in larger districts – about 3.3 (over 2,000 students) to 3.36 (over 5,000 students) – and lower in smaller districts (under 2.0 in districts enrolling fewer than 2,000 students). This happens because of the way in which those income thresholds cut differently across urban and rural areas. Too little time to fully explore this issue here.

Here’s a figure that shows the slope for larger and for smaller districts in Kansas based on three years of data from the National Center for Education Statistics.

Relationship between Census Poverty Rates and Subsidized Lunch Rates in Kansas
Relationship between Census Poverty Rates and Subsidized Lunch Rates in Kansas

Now, I don’t suspect that the legislators who proposed this new trick really understood quite why this new approach would lead to reduced at risk funding for large high poverty districts, but I have little doubt that they understand fully that this policy will have this effect (and that they chuckled when they had this revelation) – and that is precisely why it has been proposed.

HB 2357 follows a long line of similar Kansas policies both prior to and following court rulings –  from new facilities weighting, to the “high priced house” adjustment, to the middle/upper middle class failure weight.

While I must congratulate them on their new found creativity, I must urge the Kansas Legislature to simply get over it and for once try doing the right thing!

DUMP 2357, or at least fix those ratios to be differentiated on the basis of district size.

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Quick rerun of the equations for 2008 KSDE % Free Lunch numbers as a function 0f 2007 Census Small Area Poverty Rates:

Small district (<2000) equation is

%Free =  1.787355  x Census Pov + .0594738

slide23

Larger district (>2000) equation is

%Free =   2.771016  x Census Pov + .0101273

slide12

By the way… it doesn’t look like there are a whole lot of outliers among the larger districts. They’re not the ones with the irregular free lunch counts – at least by reference to poverty rates… so why implement a policy that penalizes them?


Kansas Constitution – Consolidation and School Finance

I feel compelled to provide this brief historical note regarding consolidation of school districts in Kansas and questions over the court’s authority to use Article 6, Section 6 of the Kansas constitution as a basis for compelling the legislature to “make suitable provision for finance of the educational interests of the state.” You see, that version of Article 6 wasn’t always there. That bit that requires the legislature to make suitable provision for finance. It was added in the 1960s. Okay… so that means it was added by some hippy do-gooders who don’t represent today’s more thoughtful Kansas values. Wait… that’s not entirely how it happened. The re-drafting of the education articles came about at least in part – if not primarily – because the legislature had repeatedly tried to figure out a way to consolidate schools. If I recall correctly, in the 1940s and later, the legislature passed one law after another trying to force consolidation, but the meddling KS supreme court of the time wouldn’t let them, because they did not have the constitutional authority to do so. So… what did they do… they proposed a redrafting of the education article to grant themselves that authority, and simultaneously granted themselves the responsibility to make suitable provision for finance. In fact, they got the new education article ratified in 1966, just in time to make sure that the 1963 consolidation law could be fully implemented without court intervention.

That in mind, here’s Mike O’Neal back in 2005 responding to the court’s authority to invoke that “suitable” clause in Article 6 –

http://www.accessmylibrary.com/coms2/summary_0286-8299972_ITM

Some lawmakers questioned whether the court even had the authority to order additional funding.

“If the court is telling me to vote for $143 (million) in extra money, and I don’t think it’s in best interest of the state of Kansas, taxpayers or my school district, I’m not going to do it,” said Rep. Mike O’Neal, a Hutchinson Republican and one of the architects of the bill. “I think that’s the way all 165 legislations should feel about it.”

Interestingly, O’Neal seems more than ready – now – to take advantage of the authority granted by the 1966 constitutional revisions, but seems somewhat averse to accepting the responsibility.

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Excerpt from a forthcoming book chapter by Bruce Baker and Preston Green:

Separate and Unequal by Design: What’s the Matter with the Rising State Role in Kansas Education?

Previous attempts at consolidation had been overturned on the partial basis that the legislature lacked the authority to delegate control to county level committees to oversee and manage consolidation (Donaldson v. Hines, 1947; School District, Joint No. 71, Rooks County v. Throckmorton, 1962). In the 1963 Act, the legislature adopted an alternative strategy of delegating oversight to the State Superintendent of Public Instruction. Every significant procedure in the process, including ratification of local elections, required the state superintendent’s decision or approval (State Department of Public Instruction, 1967).

Perhaps questioning whether they were again walking on tenuous ground in allocating so much authority to the State Superintendent of Public Instruction, legislators sought to redraft the state’s constitution to specifically grant themselves the authority to do what they had already done. An 11-member citizen task force was formed to make recommendations to legislators regarding guiding principles for revision of Article 6 of the constitution. The proposed language for a new Article 6 included, among other things, the following:

Section 1: The legislature shall provide for intellectual, educational, vocational and scientific improvement by establishing and maintaining public schools, educational institutions and related activities which may be organized and changed in such manner as may be provided by law.

Section 2: (a) The legislature shall provide for a state board of education which shall have general supervision of public schools, educational institutions and all the educational interests of the state, except educational functions delegated by law to the state board of regents. The state board of education shall perform such other duties as may be provided by law.

Section 5: Local public schools under the general supervision of the state board of education shall be maintained, developed and operated by locally elected boards. When authorized by law, such boards may make and carry out agreements for cooperative operation and administration of educational programs under the general supervision of the state board of education, but such agreements shall be subject to limitation, change or termination by the legislature.

Section 6: The legislature shall make suitable provision for finance of the educational interests of the state. No tuition shall be charged for attendance at any public school to pupils required by law to attend such school, except such fees or supplemental charges as may be authorized by law. The legislature may authorize the state board of regents to establish tuition, fees and charges at institutions under its supervision.

Consolidation and the Costs of Public School Systems

When budgets get tight across states, legislatures try to figure out where they are going to find savings… as fast as possible.  One idea that resurfaces now and then is  consolidation of school districts and/or other layers of government within states, where some of those layers draw on state resources – especially schools. The issue has again emerged in Kansas as having the potential to produce “huge” savings. There is little doubt in the research literature on public education costs that smaller school districts do have elevated costs of producing even the same outcome levels of larger districts. The best review of literature on this topic was written by Andrews, Duncombe and Yinger (2002) in the Economics of Education Review, which noted that costs tend to rise for districts enrolling fewer than 2,000 students. Costs tend to rise most sharply for districts enrolling fewer than 300 students. Duncombe and Yinger have also produced more recent work on the potential savings from consolidation.

Click to access Does_School_Consolidation_Nov_05.pdf

In this article (later published in the Journal of Education Finance and Policy) the authors do find that consolidation can lead to reduced operating costs – assuming schools within districts are reorganized to achieve more optimal size.

As you might expect, Kansas Liberty, throwing its support behind the conservative house Speaker Mike O’Neil has chosen to echo the speaker’s arguments about the huge potential savings… most likely from reduction of administrative redundancies (their argument… certainly not mine).

http://www.kansasliberty.com/liberty-update-archive/2009/12jan/house-speaker-says-the-legislature-needs-to-start-examining-consolidation-of-school-district-administrators/

Consolidating Kansas school districts and other layers of government further is probably a good idea, but the savings are unlikely to be any where near as large as legislators might desire. A few important points:

1. central administrative overhead costs for public schools are relatively small – as a share of public education expenditures. The real long term savings comes not so much from reducing centralized administration (numbers of district units) but from reorganizing individual schools into more optimal operating sizes – where feasible (elementary schools of 300 to 500 students and high schools of 600 to 900 students). But, achieving this optimal long run arrangement often means significant increases in short run capital costs. As such, a well designed consolidation plan likely does not help with the short term budget crunch.

2. When one thinks of consolidating Kansas school districts, one often thinks only of consolidating the smallest of rural school districts, but many of these districts likely can’t feasibly be consolidated at the school level. Only the relatively small district level redundancies might be eliminated. One must also look to reorganize smaller districts that are carved out of and clustered near the state’s much larger cities and towns (e.g. consolidating Piper with KCK).

As for total savings, the legislature needs to realize that large shares of the state’s children already attend scale efficient, reasonably well organized school districts (as a function of the 1963 consolidations) and many of the children who attend very small districts also attend districts that are geographically remote, such that the bulk of operating costs cannot (with present teaching/learning strategies) be cut.

Consolidating and/or reorganizing school districts is likely an even more viable option for states other than Kansas.  I cannot say enough that the rationality, equity and adequacy of state programs for financing public school systems is inextricably linked to the organization of those school districts  – the grade ranges of children they serve, the enrollment size of those districts and the extent to which many small “un-organized” school districts are, in some states, carved out of densely populated areas.

Below is a table of states ranked by the percentage of children in those states who attend scale efficient (>2,000 students) unified K-12 school districts (NCES Common Core of Data fro 2006-07). While states like Montana, South Dakota, Wyoming and Nebraska make this list – as does Kansas, there is arguably less that can be done in these states to feasibly relocate children into schools and districts of optimal size.

Vermont, on the other hand is a particularly interesting case – with only slightly more students in total than Wyoming, but very few attending unified public school districts of reasonable size. Vermont is near the top of my list for major re-organization, especially as student enrollments continue to decline. The lack of organization of Vermont school districts, the role of non-operating districts and complex tuition arrangements between elementary and union high school districts has – year after year – undermined that state’s ability to achieve greater equity in school funding.

The case is similar, though arguably even more exaggerated in the nation’s most population dense state – New Jersey. Like Vermont, New Jersey has a multitude of small, non-unified school districts, not in the remote southern pine barrens area, but in densely populated areas adjacent to New York City (Bergen County) and near Philadelphia. In some cases, undersized K-8 school districts span a few city blocks. Even more so than Vermont, New Jersey has made efforts to improve equity in school funding – but some of these gains are necessarily offset by the awkward and inefficient organization of New Jersey school districts.

Finally, there’s Illinois – which unlike Vermont or New Jersey has never really made any effort to improve equity in financing schools. In fact, Illinois is among the only states that to this day maintains a persistent strong negative relationship between available school resources and school district poverty and racial composition. Now, not familiar with details of school district organization in Illinois, one might assume the unorganized school districts to exist in the southern and more rural regions of the state. However, Illinois’ lack of organization of school districts mirrors that of New Jersey – existing primarily in the most densely populated suburbs around Chicago.

So, there they are… my picks for the day for consolidation and reorganization – Vermont, Illinois and New Jersey – if anyone is paying attention. In Illinois and New Jersey especially, the geographic constraints to reorganizing where students attend school are minimized. Vermont might take a little more work, and all three will require some significant investment in new and reorganized infrastructure.

organization1

Executive Compensation in Public and Private Schools

Superintendents of public school systems are an easy target when it comes to their compensation packages. It is easy to create public outcry simply by making out-of-context comments about superintendents’ whopping “six figure” salaries.  The past year has finally seen some similar outcry regarding exorbitant executive compensation in “private” sector industries which have also sought sustenance through public taxpayer subsidy. Indeed the average taxpayer still does not make six figures and many may still lump together in their minds, the $100,000 to $300,000 salaries of public school district superintendents with the $10 to $30 million dollar annual gross compensation of many corporate executives, this despite the distance between the average taxpayer salary and the superintendent salary is much narrower than the distance between the superintendent salary and the corporate executive salary. This is not to suggest that coporate executes are appropriately compensated or that superintendents should be similarly compensated. Rather, some context is in order.
What is most interesting about superintendent compensation is that it does not seem to compare rationally across sectors within regions or across regions. In my recent work, I’ve been evaluating the finances of private schools in comparison with those of public schools. On average, I have found that private schools spend more than public schools, but have slightly lower teacher salaries, and much higher administrative expense. Among other things, in New Jersey in particular, private independent school headmasters earn, on average, about $215,000 per year (in 2006-07) while big city superintendents in New Jersey earn just under $200,000 on average. Note that the average private school in this sample has about 700 students, compared with large city school districts having over 40,000.

Interestingly, in the New York metropolitan area alone, there appear to be some significant variations in public school administrator salaries. While few, if any New Jersey administrators have been earning in excess of 300,000 per year, many administrators in New York state earn in excess of 300,000 and in some cases many within the same school district.  http://www.nytimes.com/2006/04/23/nyregion/nyregionspecial2/23weadmi.html?fta=y&pagewanted=all. Ford Fessenden of the New York Times has followed this issue in the past.

In Illinois, primarily in the Chicago metro area, 10 administrators exceeded the 300,000 mark – most working in affluent suburban districts. http://www.championnews.net/salaries.php. In Texas, the top 4 superintendents in 2007-08 were compensated over 300,000 in base salary.

This brings me to yet another recent Kansas Liberty article, which points out that Kansas school district administrators and not teachers have reaped the benefits of the massive increases in funding to Kansas schools. Setting aside the fact that those massive increases in overall funding simply do not exist (see my previous posts), let’s take a closer look at the Kansas Superintendent salaries mentioned, and implied as exorbitant in the Kansas Liberty article. The Superintendent of Wichita Public Schools, enrolling about 45,000 kids, is paid most at approximately $278,000 and Blue Valley, enrolling over 20,000, second at about $275,000.
http://www.kansasliberty.com/liberty-update-archive/2009/12jan/administrators-not-teachers-reap-rewards-of-increased-school-spending/. [SEE COMMENTS BELOW, WHERE MY WELL INFORMED COLLEAGUE MIKE SLAGLE PROVIDES CORRECTED FIGURES FOR BLUE VALLEY. SURPRISE, SURPRISE – KANSAS LIBERTY PROVIDED DECEPTIVE NUMBERS. THEY DID SEEM HIGH TO ME. I HAVEN’T BEEN OUT OF KANSAS THAT LONG]
In the past I’ve used two comparison bases. First, how do these stack up against other superintendent salaries elsewhere in the country and second, how do these stack up against private independent school headmasters.  Well, there aren’t many exclusive private independent schools in Kansas or in the Kansas City metro area, and for those in Kansas (including Wichita Collegiate and Topeka Collegiate), salaries are on the order of $150,00 according to recent non-profit financial filings, while those in the Kansas City metro approach and exceed $200,000 (Barstow and Pembroke Hill) for 2006 (2007 tax filings – IRS 990). Unlike New Jersey superintendents, whose base pay is much lower than private school headmasters, these Kansas Superintendents are making out okay.
So what about the comparisons to Illinois and Texas Superintendents. A $275,000 salary would put a superintendent into the top 20 in Illinois and top 15 in Texas. But, to do this right, one really needs to adjust for regional cost differences. In this case, as in others, I look to the regional wage variation factor published by the National Center for Education Statistics (http://www.nces.ed.gov/edfin/adjustments.asp). In 2005, Wichita is assigned a wage factor 1.0731 and the Kansas City metro (for Blue Valley), 1.2092 (meaning that Kansas City had average wages – controlling for age, education level, occupation and industry) that were about 13% higher than Wichita. As such, to compare the Wichita Superintendent and Blue Valley superintendent, we take:
$278,000/1.0731 =$259,000 in year 2000, regionally adjusted dollars
$275,000/1.2092 = $227,000 in year 2000, regionally adjusted dollars
[Note that the inflation adjusted component of the NCES ECWI is only updated through 2005, so the inflation adjustment of these 2007 and 2008 salaries is imperfect. But the relative comparisons of these salaries across these labor markets is reasonable]
So, with regional adjustment, the Wichita superintendent makes much more than the Blue Valley Superintendent. But, how do these compare to salaries in Chicago or Texas. The average comparable wage index for the Chicago Metro is 1.3873, for Dallas, 1.389 and for Houston, 1.354.
So, that would mean that the Wichita salary of $259,000 in year 2000, adjusted dollars would be equivalent to a salary of:
1.3873 x 259,000 =$359,301 in the Chicago area
1.389 x 259,000 =$359,751 in Dallas
1.354 x 259,000 =$350,686 in Houston
And the Blue Valley salary of $227,000 in year 2000, regionally adjusted dollars would be equivalent to:
1.3873 x 227,000 =$314,917 in the Chicago area
1.389 x 227,000 =$315,303 in Dallas
1.354 x 227,000 =$307,358 in Houston
The superintendent of Dallas ISD was paid $327,600 to run a district of 158,000 kids in 2007-08, and that was tops in the state of Texas. The Wichita Superintendent was paid significanlty more for a district less than 1/3 the size. The Houston Superintendent was paid $314,500, for a district of 200,000 students, about the same as the Blue Valley Superintendent for a homogeneous, middle class white district only about 1/10 the size. In a more parrallel comparison, the Plano superintendent was paid $263,025 – for a more homogeneous suburban district, but still twice the size of Blue Valley.
The Newark, New Jersey Superintendent (2006-07) was paid about 250,000, in a labor market with an ECWI of 1.4669. The Kansas salaries would translate to 227*1.4669 = $333 thousand and 259*1.4669 = $380 thousand.
In this particular case, I might have to agree with the Kansas Liberty general critique  – though the rhetoric or the framing of it – that some Kansas superintendent salaries may in fact be slipping out of line, especially in a state where teacher salaries continue to hang around 40th nationally, as they have for quite some time.
Going back of the napkin today (spreadsheet and statistical software free) so I may have blundered on a calculation or two. Links to data are above. Enjoy and correct if necessary. Thanks.
Cheers.

KS Liberty revisionist history…

The same KansasLiberty article I addressed yesterday also included the following quote:

“The court’s only evidence was a discredited school audit that had been dismissed by the Legislature, which had commissioned it, as impractical and dangerously expensive. The audit’s figures had been compiled by asking school administrators how much money they would like to receive to achieve a range of outcomes.”
http://www.kansasliberty.com/liberty-update-archive/08dec2008/study-shows-huge-education-funding-increases-have-had-no-impact/
Wow… that’s one twisted interpretation. While the Augenblick report was far from stellar research by any stretch, it was, as you note the report that had been commissioned by the legislature. It was pursued on recommendation from a Governor’s Task Force (which also included legislators). Further, the charge of the report was specifically linked to the constitutional language which had also been referenced in the Task Force recommendation. And while the report had been shelved by the legislature, they never criticized it openly until after the case went against them in the lower court. It had not been discredited by legislators when the case went to trial and it was not discredited by any of the experts at trial.

Most of the evidence cited by Judge Bullock as basis for determining the constitutionality of the school finance system was unrelated to the Augenblick study. It was evidence related to disparities in funding across districts, which harmed certain populations and were associated with large persistent disparities in educational outcomes. The Augenblick study was cited primarily as an option for achieving constitutionality – a guideline – the legislature’s own guideline – one possible guideline for achieving constitutionality. It was the only one on the table. Would you have preferred the Judge to make up his own? Seems logical and fair to use the legislature’s own target.

Further, when the legislature was granted a do-over in 2006 by the Supreme Court, they commissioned two additional studies overseen by the Division of Post Audit. From these studies they got roughly the same answer they had gotten previously, and once again chose to ignore the findings.

Eventually, the court let them off the hook after a modest (and still inequitable) infusion of some additional funding, dismissing the case while leaving open the question of whether the system is actually constitutional.

For a thorough review see:

Click to access kprv27n2.pdf

Kansas Study Finds Huge Infusion of Cash Didn’t Help Schools

Today, the self-proclaimed non-partisan news outlet KansasLiberty.com reported that a scholar at the University of Kansas Business School has come to the brilliant conclusion that the massive infusion of funding that went into Kansas public schools from 1997 to 2006 has led to no substantive improvements in student outcomes. The author of this report presents a handful of graphs and a few crude regression models of the relationship between spending change and outcome change between 2004 and 2006 for test scores and 1997 to 2005 for “persistence” measures.

Click to access TR08-1205–EducationSpending_Neymotin.pdf

Setting aside academic nitpicking over the absurdly crude statistical analysis provided by the author, lets take a look at the basic question of whether there even was a massive infusion of funding to Kansas schools from 1997 to 2005.

Data on unified K-12 school districts from the Fiscal Survey of Local Governments – Public Elementary and Secondary Education Finances suggest otherwise – In fact, Kansas fell further and further behind national averages during that very period. And, any court ordered funding that went into the system, did so after the period investigated.

year Nation Kansas Gap
1990 $ 4,422 $ 4,105 $ 316
1991 $ 4,683 $ 4,252 $ 431
1992 $ 4,779 $ 4,536 $ 243
1993 $ 5,072 $ 4,944 $ 128
1994 $ 5,242 $ 5,157 $ 84
1995 $ 5,415 $ 5,261 $ 154
1996 $ 5,568 $ 5,436 $ 132
1997 $ 5,751 $ 5,550 $ 201
1998 $ 6,020 $ 5,786 $ 234
1999 $ 6,336 $ 5,946 $ 390
2000 $ 6,722 $ 6,243 $ 479
2001 $ 7,191 $ 6,547 $ 644
2002 $ 7,525 $ 7,048 $ 477
2003 $ 7,854 $ 7,291 $ 563
2004 $ 8,123 $ 7,519 $ 604
2005 $ 8,530 $ 7,706 $ 825

Okay… so let’s take a second look. Here’s Kansas versus the nation after adjusting simultaneously for regional differences in labor costs and for inflation in labor costs, using the National Center for Education Statistics, Comparable Wage Index. Now… Kansas is higher than the national average, because Kansas is a very low cost state.  But, notice that Kansas current spending has been pretty much flat over the period after controlling for changes in competitive wages.

year National Kansas
1998 $ 6,558 $ 7,251
1999 $ 6,579 $ 7,102
2000 $ 6,609 $ 7,041
2001 $ 6,801 $ 7,078
2002 $ 6,748 $ 7,238
2003 $ 6,858 $ 7,277
2004 $ 6,851 $ 7,290
2005 $ 6,987 $ 7,328

So why does this matter? Let me connect the dots here. If there was no massive infusion of cash into Kansas schools, one could not possibly measure an effect of such an infusion on educational outcomes. There must be a shock to the system to measure the effects of that shock on the system. Pretty simple. Further, even if funding had crept incrementally upward across all districts while outcomes simultaneously crept incrementally upward, one could not distill statistically a relationship between the two – Certainly not over a period from 2004 to 2006, only a few years later. Interestingly in this case what we have are outcomes drifting upward with resources staying constant (with respect to competitive wage growth) or negative with respect to education spending growth nationally.

One earlier, more rigorous, peer reviewed study in the Economics of Education Review, addressing the infusion of funding to Kansas schools during the 1992 reforms, found via fixed effects (change over time) regression:

“Using panel models that, if biased, are likely biased downward, I have a conservative estimate of the impact of a 20% increase in spending on the probability of going on to postsecondary education. The regression results show that such a spending increase raises that probability by approximately 5%.”
Deke, J. (2003). A Study of the impact of public school spending on postsecondary educational attainment using statewide school district financing in Kansas. Economics of Education Review, Volume 22, Number 3, June 2003 , pp. 275-284(10).

Other studies on Massachusetts, Kentucky and Vermont have produced similar findings following major structural changes to aid formulas. I’ll gladly share the citations for those interested.

Cheers!