Thursday, February 12, 2015

Things to learn from the Audit of Metro Schools

From TN Edu-Independent - The $560,000 MNPS audit has been released. It's 617 PDF pages. Long. Dense. Found here: MNPS Audit

There is a lot to highlight and point out. More posts will be forthcoming, but some key takeaways from my initial jump into the document:

1. MNPS spends much more than the public thinks on a per pupil basis.

If you look at the state report card or MNPS budgets, per pupil spending is often reported in the $10,000 to $11,500 range.

The audit found: "The School System spends a total of $14,747 per student overall and spends $5,870 per student directly at the school level, not including specialty schools." (pg. 20)

The MNPS accounting structure has a number of funds through which they spend money.  The $14,747 represents spending from all those funds. I'm not 100% sure, but my initial read into the audit would reflect that this $14,747 per pupil does not reflect spending from private gifts or donations.

MNPS receives many of these, both cash and in-kind from foundations and corporations in town every year.

Some of this is highlighted, but not all from what I could tell: "The Nashville Public Education Foundation has raised $12,257,000 over the past five years alone to support specific initiatives for the School System to provide supplemental educational opportunities for students from elementary through high school." (pg. 50) 

It also appears that the $14,747 does not reflect local school level support spending (like money raised through PTOs).

In considering the amounts reported in the audit, spending which wasn't captured, and that Tennessee has a low cost of living structure, that's a lot being spent annually on a per pupil basis.

Many in Nashville often comment that the main reason we have low school performance is an issue of being under-resourced financially. Is it really a question of not enough spending or of how we're spending the money throughout the district and across the city? 

2. Money seems to be allocated according to equitable spending principles.

It's reasonable to expect that more spending per pupil is needed for students classified as low income to be able to provide a rigorous education as compared to their more affluent peers (think of extra reading specialists, tutoring support, lower class size ratios for more personalized attention, etc). (This is somewhat in the eye of the beholder, as equitable for some may be the same per pupil spending amount for every student...but again, it seems reasonable that low-income, English Language Learner and Students with Disabilities need more resources on a per pupil basis to serve well).

The audit found: "Schools with higher percentages of students eligible for free and reduced lunch tend to spend more per student." (pg. 20 and 21) "The School System tends to invest more General Fund Purpose dollars in the poorest and lowest academically performing schools." (pg. 21)

MNPS is spending money in a way that equitably makes sense. Yet other parts of the audit point out that MNPS is not often getting the desired academic results. Again, I believe this goes back to the question of how all dollars are allocated across the district by school type and program.

3. Charters are discussed (again).

It's an ongoing hot topic in Nashville. What's clear in the audit is that charter schools are more efficient to Nashville taxpayers. Per pupil revenue for charters is much lower than the total per pupil revenue for district school students:

chart found on pg 232
In addition, charters would not see that kind of enrollment increase if they were not in demand from parents. The numbers speak for themselves. If people preferred their local neighborhood zoned school, they wouldn't enroll in a charter.

"High performing charter schools offer an opportunity for the School System to improve the academic performance of its students. Therefore, there is a demand in the community to expand alternatives to persistently low performing traditional schools." (pg. 222)

4. "Cost issues" of charters may actually be mistaken for MNPS resource allocation inefficiencies.

Charters are often blamed for costing the district too much or at some point in the future going to cost too much. It's sensible to be aware of charter school costs to be able to balance the overall MNPS budget, but there needs to be more context and nuance of the charter school discussion and the value they offer Nashville families and the city's taxpayer (higher academic return, lower cost).

Let's all agree on something: charters cost money. So do all other types of schools and programs that MNPS manages.

However, the cost structure of charters is actually the most efficient we have of any school type in the district. Charters only get paid if students attend. Put another way, charter school costs are perfectly variable.

This is not the case for district schools. The district personnel staffing formula and costs of building maintenance and infrastructure still pay for many under-enrolled schools.  These are not fixed costs as some would claim. These are variable costs too, which can be changed and modified.

Given the district's staffing formula and the way it allocates funds for infrastructure and buildings, while it isn't as variable as charter costs are, these costs do have flexibility to be changed.

Some could sit on their hands and say the costs are fixed...or we could look at ways to change how the staffing formula and infrastructure allocations work to be more efficient.  These cost inefficiencies magnified over the scale of the district results in millions of dollars of inefficient costs.

The audit did a close study of 5 district schools, looking at a partial cost impact of students transferring away from district schools to charter schools.  The analysis did not consider all areas of cost savings, namely just teacher salary costs.

"The review team conducted a review of five schools that lost enrollment to charter schools between Fiscal Years 2010 through 2013. The following schools were selected based upon the increasing number of students transferring to charter schools each year. It should also be noted that other schools within the School System experienced little or no enrollment loss as a result of charter schools." (pg. 237)

I will look at two of those school charts here:

If we ignore the student transfers to charter line (a partial reason of why students left this school), over the 4 years, 2009-10 to 2012-13, we see that Bailey's student enrollment went from 537 students to 440 students, yet added 7 teachers.

Lose 97 students but add 7 teachers.

Generally this is counter-intuitive. Bailey did get some extra turnaround money, but it is one time money, not year over year money to spend on things like keeping this number of teachers that is out of proportion to prior year teacher staffing ratios. As the bottom line shows, teacher salaries are 45-53% of the total cost per student.  When a school loses students, especially of that magnitude, teacher reassignments to other schools in the district or reductions in staff are possible to ensure cost effectiveness.
This is not the case for district schools. The district personnel staffing formula and costs of building maintenance and infrastructure still pay for many under-enrolled schools. These are not fixed costs as some would claim. These are variable costs too, which can be changed and modified.

Gra-Mar's student enrollment went from 532 students to 426 students, yet added 4 teachers.

Lose 106 students, add 4 teachers.

Every school case has a unique context and specific set of factors to consider, including special turnaround or grant money.

Generally speaking though, it'd be good to ensure that the MNPS staffing formula is appropriate for every school in the district, and is flexible and responsive enough year to year (and even mid year) to adjust staff and costs based on students leaving a district school (to go to a charter or other reason).

The finger often gets pointed at charters for costs as being solely responsible for everything, but is the way MNPS allocates dollars for staffing and infrastructure as efficient as it can be?

There's much more in the audit to highlight in future posts...

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