More money for education should require less money for administration
*First appeared in the September 19, 2013, edition of the Laurel Chronicle.
Legislative budget hearings are nearly complete. By the time you read this column, legislators will have already endured hours of hearings in which agencies ask for more of your tax dollars to pay for things like increased salaries and wireless radios.
Nonetheless, the biggest slice of the state's budgetary pie will go to education, specifically K-12. Within education, the largest line-item is the Mississippi Adequate Education Program, known by most as "MAEP." Around the State Capitol, MAEP has become something of a four-letter word (see what I did there?).
When the MAEP was adopted, it was heralded as a magic formula that would, based on district measures like student population and free or reduced lunches, spit out the amount of money needed to "adequately" fund schools. So then, what's the problem?
Some say the formula is bogus and should be revamped. Others note the Legislature rarely funds MAEP at its required amount. Some say we must ensure the accuracy of the data that's being used as part of the calculation, and yet another school of thought insists we keep the formula but recalculate it on a more regular basis.
On the MAEP spectrum, I think I fall into the category labeled "yes."
Yes, let's look at the formula and make changes if necessary. But let's not forget that study of education funding should run simultaneous to study of educational efficiencies. After all, the money we can save through efficiencies is money we can steer back to the classroom.
Recognizing the serious budget pressures faced by school districts, the Legislature has already taken steps to reduce administrative costs. Under the leadership of Lt. Gov. Tate Reeves and Senate Education Chairman Gray Tollison, Clay County and West Point school districts were merged to achieve efficiency without reducing educational quality.
Clay County, a K-6 school that had its own school district and superintendent, spent $16,795.38 per student in 2011-2012 - the highest in the state. Its consolidation with West Point along with the other six administrative consolidations implemented by this Legislature will save taxpayers millions of dollars that can be re-directed to the classroom.
Mississippi ranks ninth per capita on administrative costs, which means we must do even more to reduce spending. An aggressive shared services strategy focused on areas like transportation, purchasing, and technology could result in dramatic savings.
A Deloitte study looked more comprehensively at the issue, finding that shifting a quarter of the nation's school district tax dollars spent on non-instructional operations to shared services would save up to $9 billion. That's significantly larger than Mississippi's general fund budget and the equivalent of 900 new schools or more than 150,000 new school teachers.
The report notes a Canadian example where two school boards shared bus transportation across district lines, saving $8 million in three years. New Jersey's Middlesex County municipalities have saved five percent on electricity for public buildings through aggregate natural gas purchases.
In Pennsylvania, two school districts entered into an agreement to share the services of a food service director. After the first year, the program netted a profit of $100,000 compared to the previous year which had a combined $20,000 loss. The combined volume had increased the districts' purchasing power, thus reducing food costs.
I took great interest in the report's note about the California Charter Schools Association, which created a Joint Powers Authority to save members money on mandatory costs, such as worker's compensation insurance. The typical charter school over $20,000 per year on this expenditure.
In addition, the CCSA created "CharterBuy" - a program that taps into charter schools' collective buying power to provide them with the best deals on supplies and equipment. The CharterBuy program has saved as much as 50 percent on expected costs in these areas.
Shared services isn't a new concept and has been embraced across the country by both the private and public sectors. With a top ten listing in administrative costs, Mississippi can't afford to focus on increasing education spending without an equally serious focus on reducing money spent outside the classroom.