Reform Efforts Can Bring Budget Solutions (long version)

Article for Michigan Education Report
By John Hansen, Ph.D.
Trustee, Alief (Texas) Independent School District

I am a school board trustee in the state of Texas and I have been asked by the editor to share with the readers of the Michigan Education Report some of my Texas experience that may be of interest to observers of Michigan education.

My district, the Alief Independent School District (AISD), represents the southwest side of the city of Houston and the unincorporated sections of Harris County. In Texas, most of the 1045 school districts are chartered independent of any municipal or county boundaries and are therefore called Independent School Districts. They set their own budgets and tax rates. Independent assessment boards conduct property valuations and all governments levying property taxes must use the valuations established by these boards.

Average Daily Attendance (ADA) is approaching 45,000 with a growth rate of 1000-1500 students per year. When I came on our Board, the four major ethnic groups were each about 25% of the student population. Today we are 41% Hispanic, 36% African American, 14% Asian and about 8% White. A reported 59 different languages are spoken in the homes of the District.

I was first elected to the AISD board in November of 1993. My success, quite frankly, was due to a genuine tax revolt by the homeowners of the community. Starting in the mid-1980s, my area suffered greatly from the “oil bust” occasioned by the steep decline in world petroleum prices. This decline in local economic activity quickly burst the real estate bubble that had been building in Houston since the 1950’s, similar to the decline of urban property values in Flint and Detroit. In Alief, the total property value went from $6.7 billion in 1984 to $4.9 billion in 1992. The decline in property values attracted a much poorer population that could not previously afford to live in the area. Not surprisingly, this new population had far more ethnic minorities than had the earlier population – which had been nearly all middle income White and Asian. Student enrollment went from 21,000 in 1984 to 31,000 in 1992.

The administration and board of that period did not see fit to scale back any district expenditures and the tax rate soared. With the large influx of low income population, the school district performance plummeted far below what it had been. By the time I was elected, over half of the students were failing the state TAAS exam and public confidence in the schools had evaporated.

The combination of rising tax rates and falling student achievement happened by happy coincidence to occur at the same time as the national revolt that turned the Congress over to the GOP. Somewhat presaging the national “Contract with America”, the local Republican precinct chairmen got together and endorsed a slate of candidates. The pitch to the voters was “give us a chance to reverse the rise in tax rates and the decline in student achievement – if we fail, throw us out too”.

The precinct chairmen proceeded to implement a traditional get-out-the-vote effort using their credibility with Republican voters to build support for the endorsed slate. Interestingly, public dissatisfaction was so intense that even some of the Democratic precinct chairs assisted in the effort. In the regular election of May, 1993 and a Special Election of November, 1993, three seats were won. Coupled with two incumbent Board Members who shared the goals of the reformers, we had in six months gained five of the seven Board positions and achieved control of the Board.

Just as in Michigan, voter turnout for School Board elections is extremely low. The National School Board Association reports the national average turnout in these elections is 3% of registered voters. In our area, turnouts under 1% are common. Because of this and because of their low visibility, School Board elections are typically controlled by the employee vote. In our case, every single incumbent Board Member had won because of the endorsement of the local National Education Association (NEA) affiliate. How can a Board be independent under those conditions? It can’t, but by bringing in a substantial non-employee vote, we ended that monopoly control.

Like most reformers, we found that starting a revolution is actually easier than succeeding in one. But, with the benefit of hindsight, I can see that we really did succeed in many of our goals and the lessons learned along the way may have value to others.

In Texas, the superintendent is chosen by the school board and serves at the pleasure of the school board; this ensures that the elected board holds enough voter-induced power to not only constrain policies, but to lead them.

The professional full time staff does not see itself as working for the school board. It sees itself as working for the Superintendent. Indeed, education law in Texas (and I believe in most states) explicitly states that only the superintendent works directly for the Board. So, a reform school board absolutely must have a Superintendent that honestly and fully shares the reform vision of the Board. In the absence of that, the professional staff will simply go through the motions of cooperating and will hunker down until the reformers give up and find something else to do with their time. This may sound obvious, but I think many reform efforts fail because the superintendent is not really “on board”.

In our case, the Superintendent who was in office when I was elected decided that she did not share the new Board’s vision and resigned within a few months. While this caused a good deal of political turmoil and unhappiness, in retrospect I cannot see how we could have succeeded otherwise. This gave us the opportunity to hire a new Superintendent who was in general sympathy with the goals of the new Board.

Also, a successful long term reform effort cannot succeed unless it brings along the local community and builds a substantial consensus behind its vision. The low visibility of School Boards often makes this quite difficult, but in the absence of it, professional staffs will simply wait out the reformers and do largely as they wish. Winning control of a board creates the opportunity to direct the consensus, but it certainly does not guarantee control of it.

Much of the education reform literature that I read sounds as if the authors regard teachers as the enemy of education reform. In my experience this hostility is misplaced. No one goes into K-12 teaching for the big bucks and the short hours. However misguided they may be at times, most classroom teachers have gone into the profession out of a genuine desire to make a difference in the lives of their students. I have generally found teachers to be open to new approaches to classroom instruction (especially at the elementary level) when they have been convinced of their merit and when they are supported by their instructional leaders. But, the instructional leaders must unite behind an instructional plan that works.

I often hear statements to the effect that we should raise teachers’ pay so that good people will want to be teachers and we can fire all the loafers. I believe this view ignores reality. The impending teacher shortage is so severe that we simply cannot afford to lose many of the teachers we have now.

Fast growth states like Texas are already in the throes of a severe shortage. According to a recent study by Texas A&M University, out of a total of roughly 290,000 teachers in Texas, over 40,000 new teachers per year are needed to replace the existing teachers who retire or leave the profession. An additional 7,000 per year are needed to cover growth in student enrollment. Texas Colleges of Education are producing roughly 17,000 new teachers per year. Alternative certification programs are producing another 3,500. That leaves a shortfall of roughly 27,000 teachers per year that must be met with recruiting from out of state, the return of former teachers to the profession, and any other source we can think of.

Currently, Texas recruits heavily in the Midwest and the Northeast (especially in January and February when people have had all the snow and cold they can stand). Some districts have started recruiting seriously in Europe and Asia for English speaking teachers. What Texas and other fast growth states are now experiencing, the rest of the country will be seeing within a few years. Texas is a Right-to-Work state and I know of no school district in Texas that has a collective bargaining agreement. But, the teacher shortage is already so severe for us that districts are paying teachers every cent they can get their hands on and firing only those that prove seriously incompetent.

So, supporters of education reform are going to have to get the job done largely with those teachers already in place. In states like Michigan where I understand instructional practices are often part of a collective bargaining agreement, the difficulty is clearly greater. But, no education reform really matters until it is adopted by the individual classroom teacher. Believers in reform must accept the responsibility to convince teachers of the needs we see.

What level of success have we had in reforming instruction? In my district, the 55% failure rate we had on the TAAS exam when I arrived has been reduced to about 20%. That is still far too high in my view, but I think our staff still deserves much credit for accomplishing that much. The rest of the state has shown comparable gains. Our gains have occurred despite the previously cited shifts in the District’s demographics.

How useful have these State exams been to Texas school boards? For districts like mine that have large numbers of low income and minority students, I believe they have been crucial to progress. Without the exam results, the administrators would still be telling us that all students are “lifelong learners” and Board Members just don’t understand education. It is only because of these test results that everyone has been forced to confront our real failures. Michigan’s MEAP test provides the same service for that state, providing a real measure of student success among many subgroups.

Have we improved education for all children? It is my belief that the state’s emphasis on showing improvement for all ethnic groups has produced real gains for “at risk” students. But, looking at the SAT and ACT results for Texas, I see little evidence that results at the college prep level have improved. I find this outcome plausible. The state accountability system emphasizes the percentage of students who meet the minimum standard. As in most states, it does not really reward schools for the amount by which they exceed those minimum standards. Therefore, Texas schools put their resources into maximizing the pass rate – which helps low performing students but not high performing students. Until the accountability system starts to reflect achievement above the minimum standards, I expect this pattern to continue.

In the area of fiscal management, I think we have had a clear success. Prior to the takeover of our Board, the tax rate had risen from $0.95 to $1.70 (per $100 valuation) in seven years. The rate is currently $1.68. I think those numbers speak for themselves, but how did we do it? Well, the classic problem in any organization is how to align the interests of the employees with the interests of the management (in our case, the taxpayers). We substantially succeeded in doing this.

When the new Board took over and demanded serious improvements in instructional effectiveness, the then Superintendent told us that substantial increases in taxes would be needed. We informed her that we had already had substantial increases in taxes and the improvements would need to happen with the money already available. Because of the fiscal crisis, raises had been very limited in the years prior to my arrival. We told the staff that we would let them keep the existing tax rate, but the raises would have to be found from cost reductions. This apparently gave them the needed incentive as we have never had less than a 3% of midpoint raise and one year we even gave an 8% of midpoint raise.

The biggest key to this has been controlling the numbers of non-teaching personnel. The typical school district has more than one non-instructional employee per teacher. We have lowered our ratio down to .85 non-instructional employees per teacher. Other important changes have been lowering the use of substitutes by getting teachers to have fewer absences, eliminating redundant administrators, negotiating better purchasing contracts, lowering architectural fees by reusing school designs, and using utility deregulation to lower electricity costs.

Excessive non-teaching personnel is part of the reason some of Michigan’s larger public school districts are seemingly unable to control costs. For example: As Andrew Coulson has pointed out, “Back in 1996/97, Detroit Public Schools enrolled 183,447 students, and employed 22,077 staff. Enrollment has fallen every year since, averaging 147,808 during the 2003/04 school year. Employment in the District has not fallen. It has risen to 23,800. So the Detroit Public School system is now employing 1,723 more people to teach an estimated 35,000 fewer children.”

There were some important structural reforms that greatly assisted in these cost reductions. The first of these was a move to decentralized management. Previously, the District was very centralized and campus budgets were completely controlled from the administration building. Frequently, campuses had more money than they wanted in some budget categories and not enough in others. So, the campus administrators would spend everything in the over budgeted categories (under the use-it-or-lose-it rule) and then complain about a lack of funds in the under budgeted categories. We went to what amounts to a block grant system so they could use the available money where it was needed. Overnight the alleged shortages largely disappeared.

A major problem of all legislative bodies is the pressure from special interest groups. I worked out with the District Superintendent and CFO a program of block grants (we allocate $25 per student) to meet special resource needs. Staff and parents write up funding applications for projects or resources they believe their campus requires. The campus Shared Decision Making Council (SDMC) votes on which proposals to fund in a given year. These cannot be standard classroom resources or computers as there are separate campus allocations for those. This induces the campus staff and parents to prioritize needs for us. As soon as we implemented this, we stopped having a problem getting staff to serve on the SDMCs. After the second year of this program the Superintendent made the astonishing statement that it was the first time in his 20+ years as a superintendent that not a single administrator, teacher, or parent complained about a lack of instructional resources. How many school districts—whether in Texas or Michigan or any other state—can claim that?

In summary, I believe our experience gives hope to reform-minded school boards, teachers and parents still trying to win these battles in states like Michigan. Permanent change requires getting the staff to buy into the changes and thereby avoiding nasty, unnecessary, turf-protecting in-fighting.. This only happens when their interests are aligned with the community’s—which means working amicably on behalf of sensible efficiencies and cost restraint, implementing business-style management and giving parents more options.

The time and effort required for successful reform is enormous and may well be beyond the willingness of many communities to give. Our successes in this state reinforce the belief I have always held that market solutions are more efficient than politically charged ones. I started out a supporter of school choice and my experiences as a school board member have only reinforced that belief. If we can do these things in Texas, they could and should be done in Michigan as well.