The Washington Post this weekend lobbed some serious accusations at the Montgomery County Board of Education, calling recently revealed health care savings a "slush fund." This is the latest development in a battle between the school board governing this high-spending, wealthy suburban district and the County Council that exercises putative control over the county's budget.
In this go-round, the council cut $25M from the schools budget, after which the school board suddenly found $21M in health care savings, which it promptly used to reverse an expected increase in the proportion of health care costs paid by teachers. The Post, a vocal parents' group, and others are unhappy the savings weren't used more directly in the classroom.
The whole thing reveals one of the thorniest problems of traditional "marble cake" school governance. Both the council and the school board are agents of the taxpayers of Montgomery County. They are each serving others sets of interests as well, however: students, parents, teachers, public workers other than teachers, business owners, etc. The present system of governance in Montgomery County doesn't seem to be succeeding at working out the conflicts among those groups in an orderly and transparent way.
Our recent study on trends in the special education population was only able to get at the costs of special ed obliquely. But with some states spending two or three times as much per student as others, it seems clear that districts and states could find savings in this $110 billion-plus slice of overall school spending without negatively impacting kids. Some districts are now turning to private companies to provide services at a lower cost.
The role these businesses can play seems to be twofold. First, they are more flexible than districts at providing services where and when they're needed, reducing the amount of time kids are pulled out from their normal classrooms and getting past rigid staffing formulas. Second, because they are a level removed from the difficult politics of special ed, they may have more power to say no to services that are not effective.
Outsourcing these services is no walk in the park, of course. Shady operators will have every incentive to overcharge and underdeliver. Districts must consider which services they're outsourcing, and to whom. The need for careful oversight is a given.
However, serving a population of students with very diverse needs using a variety of outside providers with narrow specialties and an incentive to help children overcome their challenges for good (if possible) is a worthy approach to try. It could both save money and provide a path to more individualized instruction for all youngsters.
The US Department of Education has hired a new director of its Federal Charter Schools Program, which oversees a variety of grant programs for starting and replicating public charter schools, as well as credit enhancements to help them afford high-quality facilities. Stefan Huh, the new director, is leaving DC's Office the State Superintendent of Education (OSSE) after four years running the Office of Public Charter School Financing and Support there. (Full disclosure: I worked for Stefan at OSSE last summer and consider him a mentor and an important influence on my decision to work full-time in education after business school.)
Stefan's tenure in DC provides some hopeful signs that ED will continue to step up its game on charters. First, while he's a strong advocate for public charter schools, he focused strongly on school quality while running the program at OSSE. For instance, the office added a competitive grant component to its teacher compensation program last summer, developed by my colleague Jessica Sutter.
Second, Huh is not a natural-born bureaucrat ? he understands that building more quality schools means taking calculated risks. For example, most of ED's grantees in the Credit Enhancement Program for charter school facilities have used those funds in safe ways that have not dramatically increased access to capital for new charters. Texas uses its $10 million from the Department only for bond financing, which typically only very mature, safe charters can access. Under Stefan's direction, DC has
New Jersey's Supreme Court ordered Chris Christie to cough up another $500 million in funding for the state's schools in a 3-2 ruling today. Very few people (aside from the three justices in the majority and Mark Zuckerberg) would argue that NJ's worst-performing schools can be fixed with more money, however.
So-called "Abbott districts," which get more money under another NJ Supreme Court ruling that deemed education in those locales inadequate, are among the highest-spending districts in the country. Newark, which is one of them, tops out at $23,000 per student using the state's new accounting method. Education in these districts is indeed inadequate and horribly shortchanges the youngsters who live there, but after 25 years of receiving extra resources, it seems clear that the problem goes deeper than money. Unfortunately, the question of what constitutes an "adequate" education in New Jersey has largely revolved around funding issues rather than processes and outcomes for children.
Nevertheless, I agree with Bruce Baker that the court's rather narrow decision was the correct one. (This may be one for the record books.) Bruce found in a recent analysis that while New Jersey's funding system is fairly progressive, giving more state aid to poorer districts, Gov. Christie's recent cuts hit high-poverty districts the hardest. Today's decision is a perfect example of checks and balances functioning correctly, with the court restoring support to the poorest and most challenged residents of New Jersey.
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About the Editor
Bernard Lee Schwartz Policy Fellow
Chris Tessone was a Bernard Lee Schwartz Policy Fellow and the Director of Finance of the Thomas B. Fordham Institute. He has strong interests in governance and education finance, especially teacher compensation and school facilities finance.