March 31, 2015

Audit the Kansas City Public Schools

We actually went back about eight years and found that there was over $25 million paid in stipends either unapproved, unauthorized or improper. I have to say, with all the money paid in stipends, the district would not be in the condition it’s in if it were under control.

This quote comes from the late Missouri State Auditor Tom Schweich, in remarks about his report on the St. Joseph School District. In the same story, Schweich reported, “There were significant other problems with payroll, overtime hours, summer school credits, nepotism issues and other questionable spending.”

The St. Joseph District is not alone in wanting to spend more money. The Kansas City Public School District has been putting “trial balloons” in the air for some time seeking to increase the taxes that fund schools. Many education advocates want to spend more money on teachers and in the classroom. But in Kansas City, the amount spent per student, approximately $16,000 per pupil per year, is already very high. The likely problem, as highlighted by Schweich’s audit in St. Joe, is that the money is often not making it to the classroom; it is being eaten up by administrators through bad policy and perhaps even fraud.

In his 2011 audit of the Kansas City School District, Schweich found lots of similar problems. According to a story by KCTV:

The district could not account for $4 million in food costs and student incentives, repeatedly failed to competitively bid projects and monitor contracts, has excessive overtime and failed to properly oversee its closed buildings, the audit found.

The state audit said a principal at Lincoln College Preparatory Academy made $58,000 in unauthorized purchases and cash withdrawals. Jamia Dock is no longer at the school and has been charged in Jackson County Circuit Court with stealing more than $25,000 in district funds. She has pleaded not guilty and the case is still pending.

The Kansas City School Board was also faulted for repeatedly violating the Missouri Sunshine Law.

Schweich’s 2011 audit grade for KCPS was “Fair,” of a four-point scale including “Excellent,” “Good,” “Fair,” and “Poor.” According to the auditor’s office, most of these findings assume that district spending numbers are correct, which means they don’t do the time-consuming work of digging into expenses. Even still, for Kansas City to score in the bottom half is an indictment.

Many parents and teachers want to see more money making it to the classroom. As Schweich’s comment at the top of this post suggested, efficient money management means that more money can be made available where it matters most. If the Kansas City School District wants to build trust with parents, teachers, and taxpayers, they should invite a thorough and recurring examination of their books and remain transparent in all their expenditures.

classroom

March 26, 2015

Charter Schools: From B to A

Missouri has made significant gains in its use of charter schools as educational options. Recently, the state earned a B grade on a charter school report card, ranking 12th strongest out of 43 charter laws. By comparison, Missouri’s charter law is better overall than many other states, but the demand for charter schools still outweighs the supply.

charter school rankings

According to the guide, most schools reported waiting lists of nearly 300 students each. The table below shows how many students transferred out of both charter schools and public schools during the 2013-14 school year. The low percentage of students transferring out of charters is an indication that waiting lists remain populated.

 

Students Transferring Out of Public and Charter Schools
  Total Enrollment Transferred Out Percentage
Kansas City Public Schools 15,627 2,441 16%
St. Louis Public Schools 25,200 8,070 32%
Kansas City Charter Schools 10,159 587 6%
St. Louis Charter Schools 9,219 444 5%

 

The availability of seats is affected by the number of new charter schools that open. Currently, Missouri charter schools do not receive any money for school facilities. In order for Missouri to become a grade-A charter school state, shifting some public funds is just one helpful reform.

There are other areas where Missouri can show improvement. For example, the charter law could be expanded to allow charters to more easily open in accredited and provisionally accredited districts.

B’s may be “above average,” which is better than where Missouri usually finds itself, but the Show-Me State is capable of much more.

Is School Consolidation an Issue of Local Control?

Money

Which Missouri school district spends the most money per pupil? If you guessed the Clayton School District, you’d be wrong. Clayton ranks sixth. Brentwood? Wrong again. Brentwood ranks 14th. At nearly $26,000 per pupil, the highest-spending district in the state is Gorin R-III; enrollment 19. If this shocks you, it shouldn’t. Eight of the 10 highest-spending districts per pupil are small districts with fewer than 100 students. In all, Missouri has 62 districts with fewer than 100 students.

Whereas larger districts often benefit from economies of scale—fixed administrative costs can be spread out over a large student body—small school districts do not. This naturally leads to higher costs per pupil; costs that many of these small districts could not bear were it not for additional state support for small school districts.

This is exactly the reason for House Bill 1292. Based, in part, on school consolidation in Arkansas, House Bill 1292 calls for the consolidation of school districts with an enrollment of less than 350 students. The Arkansas consolidation law came from a 2003-04 special session specifically targeted at fixing the state’s education funding system. Consolidation of small districts was seen as a way to save money on administrative costs.

The idea of school consolidation is sure to cause some arguments in the state capitol. Indeed, some believe it is an attack on local control of schools. However, when roughly 45 percent of funding comes from the state, as it does for the average district with fewer than 350 students, there may be a strong argument that the state has a considerable interest in the financial well-being of Missouri’s small school districts.

 

Rank District Enrollment Current Expenditure Per Average Daily Attendance
1 GORIN R-III 19 $25,931.71
2 CRAIG R-III 66 $21,812.23
3 MALTA BEND R-V 74 $19,355.81
4 BRECKENRIDGE R-I 72 $19,133.25
5 LESTERVILLE R-IV 250 $17,406.10
6 CLAYTON 2,587 $17,394.30
7 NORTH DAVIESS R-III 70 $16,764.86
8 CAINSVILLE R-I 88 $16,510.60
9 COWGILL R-VI 25 $16,483.03
10 BOSWORTH R-V 80 $16,135.35

 

March 6, 2015

What Teachers’ Unions Could Learn from Koufax and Drysdale

After the Los Angeles Dodgers won the 1965 World Series, Sandy Koufax and Don Drysdale, the two great stars of the Dodgers’ pitching staff, jointly negotiated their contracts for the next season. In effect, Koufax and Drysdale formed a pact—a voluntary mini-union, if you will—hiring a Hollywood lawyer to present their demands. Koufax ended up getting $125,000 and Drysdale $110,000, which was quite a bit of money for a Major League player back in 1966.

Sandy_Koufax_1961-248x300Reviewing the literature on collective bargaining recently reminded me of this little bit of baseball history. The Missouri National Education Association (MNEA), one of Missouri’s teachers’ unions, published a pamphlet arguing that successful collective bargaining requires an “exclusive representative” who negotiates a contract on behalf of all employees, whether or not all employees want to join the union. I pointed out in a recent post that a teachers’ association need not represent all of the teachers in a school district in order to effectively represent its members. The Koufax-Drysdale holdout illustrates this point.

DrysdaleIt would have been absurd for Koufax and Drysdale to force the rest of the team into their mini-union. More importantly, forcing everyone to accept representation from the same negotiator would be wrong. If another member of the Dodgers’ pitching staff would have refused representation from Koufax and Drysdale, it would have been his choice to make.

MNEA could learn a thing or two from the Koufax-Drysdale holdout. Rather than forcing every teacher in a school district to accept representation from their organization and negotiating a contract on behalf of all teachers, MNEA could seek to represent teachers in a members-only capacity. Members-only representation is where a union only represents its own members and neither forces nonmembers to pay fees nor forces them to accept a contract the union negotiates. Members-only agreements allow workers the freedom to choose whether or not to be represented by a union. They also give unions the freedom to withhold services from nonmembers.

The Koufax-Drysdale holdout is just one example suggesting that there are alternative ways for groups of employees to bargain with their employers. These alternatives can be as effective as exclusive representation—and they can be done in a way that fosters individual freedom.

February 24, 2015

Ideas for Kansas City Schools: Focus on Teachers

IMAG0950

Last night the Show-Me Institute partnered with the Kansas City Federalist Society for a panel discussion on the Future of Education in Kansas City. Panelists included James Shuls of the Show-Me Institute, Doug Thaman of the Missouri Charter Public School Association, Amy Hartsfield of the Kansas City Public Schools (KCPS) Board of Directors, Andrea Flinders of the American Federation of Teachers, and John Murphy of the Missouri Catholic Conference. The event was well attended, and the discussion lasted two hours; I think everyone would agree that it was educational.

One topic of discussion was pay for teachers. Flinders asserted that Kansas City teachers are paid lower than the state average. She is most likely correct, and there is something we can do to fix it. In previous posts we suggested reforming teacher pay schedules to increase the incentive for teachers to stay on.

But the district actually can pay teachers more if it cuts back on hiring non-teacher personnel. According to my colleague Brittany Wagner,

Over the past 60 years, schools have increased non-teaching personnel positions by 702 percent. [A report] also found the U.S. spends more than double what Korea, Mexico, Finland, Portugal, Ireland, Luxembourg, Austria, and Spain spend on non-teaching staff salaries and benefits.

Recall that upon arriving Superintendent John Covington asserted that the district was too big, and in 2010 KCPS closed 30 buildings and eliminated 1,247 full-time equivalent positions. Doing so freed up a great deal of money. According to Wagner,

One study showed that if non-teaching personnel grew at the same rate as the student population, American public schools would have an additional $24.3 billion annually.

This impacts pensions as well, which is far greater than the immediate cost of this educational bloat on salaries. Show-Me Researcher Michael Rathbone writes,

Non-teaching personnel also accrue pension benefits through the Public Education Employee Retirement System of Missouri (PEERS). According to the PEERS annual report, “PEERS is a mandatory cost-sharing multiple employer retirement system for all public school district employees (except the school districts of St. Louis and Kansas City), employees of the Missouri Association of School Administrators, and community college employees (except St. Louis Community College).” Members of the plan and their employers both contribute to the pension.

Over the last five years, the unfunded liabilities (liabilities minus assets) of this plan have increased by more than $64 million. Pension benefits like PEERS benefits are guaranteed and must be paid out. If PEERS can’t make those payments, taxpayers (i.e., you) will have to.

By spending too much on non-teacher personnel, KCPS is draining resources from both funds to pay teachers in the short term and teacher pension funds in the long term. Cutting back on non-teacher staff—or perhaps just restricting growth—would allow school districts to better meet their financial responsibilities to teachers and to demonstrate a real commitment to the children in the classroom.

February 20, 2015

Teachers’ Union Gets Collective Bargaining Wrong

IMG_5945_Last week someone forwarded me this pamphlet from the Missouri National Education Association (MNEA) on collective bargaining for teachers. It’s a well-put-together brochure that explains the MNEA’s position on a pretty complicated issue. While I applaud the union for producing a primer on an area of public policy I think most people do not know a whole lot about, I take issue with a few of the points they make.

1. The MNEA’s pamphlet argues that the only way for teachers to successfully achieve an enforceable labor agreement is when one union acts as the exclusive representative of all the teachers subject to the labor agreement. This requirement is nowhere to be found in the constitution. It was not mentioned by the Missouri Supreme Court when it created collective bargaining rights for teachers in 2007. And the Missouri Supreme Court failed to mention the necessity of exclusive representation in any further decisions.

Furthermore, there are school districts in Missouri, such as Hillsboro and Warren (see below), where the school district has a labor agreement with multiple teachers’ unions. The fact that both the Missouri State Teachers Association and the MNEA already represent teachers in multiple multi-party labor agreements proves that a single exclusive representative is unnecessary.

2. The MNEA’s pamphlet suggests that collective bargaining through an exclusive representative is a democratic process that results in fair representation for all teachers subject to the labor agreement. Ordinarily, once a government union obtains the privilege of acting as the exclusive representative for employees, it never has to run for re-election. There’s hardly anything democratic about a representative winning a lifetime appointment after a one-time election.

Worse still, when one union wins the privilege to act as the exclusive representative for a group of government employees, other employee groups often lose out. We’ve seen this with both teachers and police.

3. The pamphlet fails to mention the history of teacher collective bargaining in Missouri. Instead, it simply alludes to a couple of Missouri Supreme Court cases in the late 2000s. In fact, the Missouri Supreme Court imposed collective bargaining on teachers in those cases. Prior to 2007, the courts had long held that the Missouri Constitution did not give government unions the right to collectively bargain with the government. Indeed, when collective bargaining language was added to the Missouri Constitution, collective bargaining with the government was seen as impossible and potentially unconstitutional.

Teachers’ unions, like the MNEA, may now collectively bargain with the government. However, this is not some long-established right. The court created teacher collective bargaining law only eight years ago. Whether you consider this an activist decision or the product of a living constitution, the law is still in flux. There is no reason for the MNEA to assume that principles used in the private sector, such as exclusive representation, have a necessary place in collective bargaining with the government.

February 11, 2015

Teacher Pensions: Let’s Not Become Illinois

When talking about pension reform, it’s easy to lose sight of the real, human consequences of the decisions policymakers make.

Jessica Canale is an art teacher in North Saint Louis City. She commutes every day from O’Fallon, Illinois. While it might seem like a trivial decision to choose between working on the east or west side of the Mississippi, in actuality, when it comes to the money that will be available when she retires, it matters a great deal.

In January, Dick Ingram, executive director of the Illinois Teachers Retirement System (TRS) explained just how bad Illinois’ fiscal position has become. In order to deliver promised benefits, the state has divided teachers into two categories—Tier I and Tier II.

Tier I teachers will enjoy promised benefits, while Tier II teachers, those hired after 2010, will receive greatly reduced benefits. According to Ingram, “Tier II is designed to help solve the financial problems faced by TRS and the other systems by reducing pension benefits for these new members. Lower pensions means reduced long-term costs for the state.”

But “reducing pension benefits” is an understatement. In order to pay for Tier I pensions, Tier II teachers and administrators will have to contribute 9.4 percent of their salary while only receiving 7 percent toward their retirement. No wonder Jessica would rather commute to Saint Louis than give 2.4 percent of her compensation to older teachers.

But Missouri is not much better. According to the National Council on Teacher Quality, Missouri’s pension plan earned a grade of D-.

In his 2013 policy study on public employee pensions, AEI resident scholar Andrew Biggs called the situation in Missouri a “looming crisis.” Luckily, he offered several suggestions:

  • Promote better accounting, which will show the extent to which plans are underfunded.
  • Attract and retain quality public employees like Jessica by changing existing plan structures to either a defined contribution or a cash balance approach.
  • Give employees more freedom to choose the retirement plan that works for them.

As Show-Me Institute analysts have continuously argued, there are solutions to Missouri’s pension problems. For teachers like Jessica, Missouri has to do better.

January 23, 2015

For Education, It’s More of the Same

Basic RGB

In Wednesday night’s State of the State address, Gov. Jay Nixon doubled down on the same education initiatives that have gotten us nowhere—increased funding, mandated standards, accountability tests, strong tenure laws, smaller class sizes, increased teacher salaries. This has been the strategy for the past 20 years, and it hasn’t worked.

Since 1992, per-pupil spending in Missouri has increased nearly 40 percent in inflation-adjusted dollars. Missouri has had state-imposed learning standards since 1993. We’ve participated in No Child Left Behind mandated testing for more than a decade. Teachers are given an indefinite contract after five years, making it difficult to remove even an ineffective teacher. In 2014, there were approximately 13 students to every one teacher. The average teacher’s salary is nearing $50,000, with a 14.5 percent match on retirement contributions and benefits that far surpass private-sector counterparts.

More of the same is not going to propel Missouri forward.

Allowing charter schools to enroll students across district boundaries, creating opportunity scholarships, reducing mandates—these are the types of policies that will create an ever-improving educational market. These are the types of changes we need.

If we truly believe that “education is the key to the economic future of our state,” as the governor suggested, then we need to re-think our policies and re-imagine what it means to have a quality public education system. Mandating, taxing, and spending will not get us to the schools that we need. We need policies that enable school leaders to be change agents who empower parents with educational options.

January 15, 2015

Missouri Ranks 33rd on New Quality Counts Report

c-minus

As they do at the beginning of every year, Education Week released their “Quality Counts” state report cards. Once again, Missouri ranks in the middle of the pack, 33rd overall with a C- grade. For regular readers of the Show-Me Daily blog, this should come as no surprise. Missouri has been stuck in the middle for years.

Why is Missouri perpetually in the middle when it comes to academic rankings? After all, we are several years into an initiative launched by the Missouri Department of Elementary and Secondary Education to get Missouri into the top 10 by 2020. This initiative has spawned changes at nearly every stage of education, from pre-kindergarten to teacher preparation. One could argue that these changes just haven’t had time to take root, and once they do, Missouri students will be making academic gains like gangbusters. I doubt it.

Missouri is not likely to make significant improvements, because Missouri’s education policies are predicated on getting things right—if we get certification right, teachers will get better; if we get standards right, instruction will improve; if we get accountability tests right, achievement will rise. The list could go on and on. The problem is that we don’t know the “right” way to do these things for every child and every teacher in every school, and we never will. Until our education policies shift from a “getting things right” mentality to one that fosters continuous improvement, we should not expect marketable differences in outcomes.

How do we do this? Andy Smarick outlines a nice plan in his book, The Urban School System of the Future. He starts with a somewhat controversial but true premise, “The traditional urban public school system is broken, and it cannot be fixed. It must be replaced.” Smarick goes on to substantiate this claim and offer a solution, creating an educational market where new schools regularly open and bad schools regularly close. This is how improvement happens in every other sector.

Smarick’s proposal would require substantial legislative changes, but here are two easy places for Missouri to start moving in the right direction.

  1. Allow charter schools to enroll students across district boundaries.
  2. Expand options for students by establishing an Equal Opportunity Scholarship program.

These changes themselves will not get us anywhere near what The Urban School System of the Future outlined. They will, however, begin moving Missouri toward that system of continuous improvement.

January 9, 2015

Should Missouri Use an A Through F System to Grade Public Schools?

restaurant-ratings-abc-1031

The practice of grading organizations using an A through F grading scale has been utilized by many types of industries. This legislative session, elected officials will decide if the system is right for Missouri’s public schools. Senate Bill 28 “requires the State Board of Education to develop a simplified annual school report card for each school attendance center using a letter grade of A to F.”

To understand Missouri’s current accountability system, the MSIP-5, a parent must first have access to the Internet. The Comprehensive Guide can be located using the Department of Elementary and Secondary Education’s (DESE) website. Navigating the site is notoriously difficult, especially for a first-time user. Once the document is found, the parent must read through 104 pages of confusing tables and formulas just to, hopefully, understand the accreditation process on page 56.

The table below shows Missouri’s accreditation scheme. Although there are only four categories, words like “partially accredited” are not intuitively associated with the word “underperforming,” as the letters C and D are.

accreditation

To gain a different perspective, imagine if restaurants were evaluated using the MSIP-5—“How about dinner at Barcelona in Clayton? It got an APR of 73; oh, but its MPI was Floor.” Simply saying the restaurant has three and half stars on YELP indicates the restaurant is good, but perhaps some have had a not-so-good experience.

Our familiarity with letter grades, stars, and even “$$” provides us with simple indications of the type of service we should expect to receive. States such as Florida, Oklahoma, and Indiana have developed similar A through F school grading schemes. Some criticisms state that the systems are “oversimplified” or “have arbitrary cutoffs.” With any system, including the MSIP-5, there may be questionable cutoff points.

Ultimately, an A through F grading scale would allow parents a better understanding of what a school offers, turning them into more effective consumers of educational services.

 

 

November 17, 2014

Ideas for Kansas City Schools: Pay Teachers More Sooner

Kansas City Public Schools (KCPS) is seeking input from parents, school staff, and the community about how it might regain and sustain full accreditation and retain and attract students. To that end, it is forming a School Improvement Advisory Committee (SIAC) and has been seeking applicants to serve in that capacity. Previously, we shared some ideas for strengthening administration and staff. Today, we’d like to suggest at least one change to Kansas City’s teacher pay schedule: pay teachers more sooner.

As it stands, the pay schedule for Kansas City teachers starts low and provides only modest increases in the initial years. Largest pay increases come at the end of a career, in a manner to maximize pension value. As my colleague James Shuls has argued in previous posts, this is a disincentive for new and effective teachers to stay on. Dane Stangler and Aaron North of the Kauffman Foundation wrote in a March 2014 op-ed in the St. Louis Post-Dispatch:

Because most of the pension value accrues in the final years of an educator’s career, the typical new teacher in Kansas City or St. Louis does not benefit from the current system. Based on our research, we estimate the likelihood that a traditional public school teacher in St. Louis stays in the profession long enough to earn the maximum pension benefit to be about 4 percent. In other words, 96 percent of teachers in St. Louis will leave prior to reaching the full benefit and the percentage is comparable in Kansas City (approximately 3 percent).

As a result, new teachers are less likely to stay on. According to the Show-Me Institute’s Michael Podgursky, “After eight years, roughly 70 percent of teachers remain on the job. The eight-year survival rates in STL and KC are far lower, ranging from 10 percent to 30 percent.”

Podgursky’s paper urges more transparency and,

Given the relatively small share of new teachers in Kansas City or Saint Louis who can expect to complete an entire career in either district, as a strategic recruiting tool it makes more sense to raise front-end salaries, 

rather than “generous end-of-career retirement benefits.”

Certainly, there are many reasons why teachers in Kansas City and Saint Louis are much more likely to leave, and creating a more fair pension system will not solve all of them. But one thing we can do in Kansas City is to let new teachers know they are valued early on in their careers and that we want them to stay on.

November 14, 2014

Vail Lifted from Teacher Collective Bargaining Negotiations in Colorado

Colorado voters said YES to Proposition 104 last week at a ratio of 7 to 3. The ballot initiative will open collective bargaining negotiations between teachers’ unions and school boards to the public. Supporters say the new law will bring transparency to local government, allowing parents and taxpayers a look into what teachers’ unions ask for during negotiations.

Should Missouri pursue similar reform?

Collective bargaining agreements (CBAs) are subject to Missouri’s Sunshine Law. Many existing agreements can be viewed on Show-Me Sunshine. Here are just a few of the hundreds of items teachers and school boards have bargained for:

  • Salary
  • Benefits
  • Sick days
  • Student behavior
  • Parent communication
  • Amount of time a parent may spend in the classroom
  • Paid release days for union activity
  • Hiring policies

Parents may not be aware of the restrictiveness of some of these contracts. A study by USC Associate Professor Katharine Strunk found that in school districts with more union power school boards had less flexibility in decision making. This is unnerving, as school board members are elected by citizens; teachers’ unions are not.

Perhaps if Missouri’s Sunshine Law was expanded to include collective negotiations, school boards would be less likely to give in to cumbersome demands in the presence of taxpayers and parents. In the absence of a collaborative policy, this would bring parents and taxpayers a step closer to having a place at the bargaining table.

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