As districts across the country prepare themselves to report out on the requirements of ESSA, many districts are focusing much of their attention on how they are spending on a per-pupil basis. For many districts, this is a new way of budgeting, so this post includes some guiding questions to lead your efforts into early analysis of per-pupil spending across schools. The guiding questions and our recommendations draw on the work of Marguerite Roza at Georgetown’s Edunomics Lab.
1. Are your policies shortchanging any schools within your district?
Ask any Superintendent or CFO about their district policies and they’ll be able to tell you anything you want to know. But the real question is, “How are these policies governance trickling down to the school level, and affecting day to day operations and the ability to teach students?” While policy is in place for a reason, policy for the sake of policy is not always a winning combination for the teachers and students eventually affected by them. Take some time to review your most pertinent policies, and consider the ways in which those policies actually affect the teachers and learners in your district. Does a policy negatively affect one of those groups? See what you can do to be an agent of change to help make the policy better-informed.
2. Are salary patterns driving uneven spending in ways that are concerning?
The number one spend of districts, nationwide, is salaries. And it’s not just teacher salaries, but also administrator salaries, Central Office staff salaries, and the salaries of the various other employees required to run a district. Spending at any given school within a district is directly determined by the number of employees, but also of those employees tenure and education level. It’s fair to say that a school with the exact same number of teachers and students may cost half the amount of another school with more experienced and better educated teachers. Districts should carefully consider the various drivers that affect district revenue and staffing structures; enrollment, negotiated contracts, and forecasting. With deliberate and strategic planning, districts can confidently allocate for personnel expenses without egregiously impacting their bottom line.
3. What share of the dollars are centrally-managed?
One of the biggest ways in which ESSA is changing the way finances are reported is that site-based spending is becoming a mandated portion of the ESSA Report Card. Up until now, many districts have kept the majority of the budget “housed” at the Central Office level. This means that there was little to no transparency for building administrators to understand and manage their budget (because they didn’t even know what percentage of the district budget was actually allocated to their own school). A good rule of thumb is to keep between 5% and 10% of the total budget centrally managed, and the rest should be budgeted to specific locations and managed at those levels as well. Consider how much of your district’s budget is pushed down to the site-level, and see where you can begin making metered improvements in this area.
4. Relative to meaningful peers, how well are dollars being leveraged at each school to drive outcomes?
Historically, peer comparisons have been used as a strategy to assist districts in determining their effectiveness in spending, and outcomes related to that spending. Typically, any given district can identify a set of peer districts who operate within similar budget constraints and serve the same demographic. Observing how these peer districts spend, and measure their outcomes against spending, can provide your district with useful data and best practices with which to measure (or eventually, model) yourself. Determining where you may be falling short on certain spending categories can also assist in strategic planning for upcoming years.
Analyzing your district’s per-pupil spending requires not only a transparent look into how resources and funds are being attributed between schools within your district, but an honest evaluation of the policies in place that may be hindering or contributing to that attribution. Districts that invest in such reflection will not only prove their districts ESSA ready, but maximize outcomes for the students in their care.
ABOUT THE AUTHOR
Allovue works with districts and state departments of education across the country to allocate, budget, and manage spending. Allovue's software suite integrates seamlessly with existing accounting systems to make sure every dollar works for every student. Allovue also provides additional services such as chart of accounts and funding formula revisions.