A friend recently sent me a Yale thesis that used regression analysis to determine the quantitative impacts of the Act 46 mergers. As someone who participated in the policy discussions that led to Vermont’s 2015 school consolidation law, and has closely followed the outcomes, I read this report with great interest. I was eager to compare the learnings of that report to the current legislative efforts in Act 73 to address rising education costs. I will distill those findings here because I believe it’s important for Vermonters to understand which policy choices will and will not help in addressing our education spending and property tax woes.
As 21st century Americans, we have been conditioned to think that bigger is better; we see manifestations of this all around us in the form of cities, larger vehicles and giant retail chains, as a few examples.
However, bigger does not always mean better outcomes. Increased scale can cause its own problems, including a loss of focus on individuals and communities. The Yale report found that education is one of these areas. The central finding was that there was no significant change in overall spending or local tax rates from the Act 153 and Act 46 mergers, after consolidating 273 school districts down to the current 119; Act 73 contemplates further consolidation down to 10-20 districts. This would mean the removal of over 250 local school boards since 2010.
Act 46 actually appears to have increased the cost-per-pupil in our education system. You can see a definite acceleration in spending as mergers got underway in 2016. Equally important is that student outcomes have also been falling since 2013; larger school governance structures do not seem to have addressed either of these issues. This was further reinforced by a report put out by Campaign for Vermont in December, which confirmed that larger school districts in Vermont do not perform better on either cost or outcomes basis.
So, why would consolidation increase spending? According to this report, for a couple reasons: The first is transportation costs ($166 increase per student). There were also some minor material cost increases ($88 per student), but the big one was salaries and benefits ($1,121 per student). The reason for these salary and benefit increases is not obvious and eluded even the author of the report. When you merge business entities (in this case school districts), you need to re-negotiate staffing contracts and there is pressure to level up the lowest paid salaries to match the most generous contract among the previous districts. In other words, no one wants to take a pay cut, so you end up bringing everyone up to the same (higher) pay scale. This costs money, both in year one and subsequent years. It also explains why any savings from administration and contracted services were soaked up by these newly introduced costs (or, diseconomies of scale).
Perhaps more importantly, when you increase the geographic footprint of school districts, boards are now responsible for dozens of schools instead of only a handful; it becomes very difficult for board members, who are supposed to be the oversight mechanism, to have a strong sense of what is happening in each individual building and whether or not schools are meeting their obligations to students. This is further complicated when we start adding assignments to these volunteer board members, like consolidation mandates or “policy governance.” It shifts the focus away from education quality and meeting students where they are. We are seeing the results of this; today, our students are performing below the national average when you control for our demographics. Prior to the Act 153 and Act 46 consolidation efforts, we were among the best in the country.
When I talk to people about this, they say things like “I just can’t believe larger districts won’t save money” or “there must be administrative savings, right?” There are some administrative savings of course, but they are swallowed up by other diseconomies of scale that drive costs higher. When having these sorts of policy discussions, it is important to keep the facts in front of us, because it is easy to get distracted with platitudes that sound reasonable at the surface but fall apart as you look more closely. Such is the state of our politics today.
Fortunately, there are options that the data and research support. Getting rid of school boards (aka districts) is not one of them. Instead, keeping a local focus on student outcomes with districts that are a manageable size for board members to stay engaged with their school communities is important. Economies of scale can be found through shared services between school districts that can reduce the cost of districts procuring these on their own. We already do this for special education, but it could be expanded to all sorts of things, such as bulk purchasing, facility maintenance, transportation, HR, financing and accounting, AP and language classes, and the list goes on. Campaign for Vermont put out a proposal this past spring for one such model, but the key is thinking about how to collaborate without giving up the things that make Vermont schools special; the ties to their communities.
A group of Vermont colleges has already done this through the Vermont Higher Education Collaborative. They did this to achieve economies of scale without losing their individual identities. It could serve as a model for how we provide primary and secondary education as well. You will hear all kinds of arguments over the next couple years about what needs to be done with our education system, but remember that bigger is not necessarily better. Better is better; demand transformations that are focused on outcomes backed by data.
Ben Kinsley is the interim executive director for Campaign for Vermont Prosperity, a nonpartisan advocacy group seeking to grow the state’s middle class. He lives in Burlington.