money matters

Why money for Memphis schools is about to be based on students, not adults

PHOTO: Laura Faith Kebede
Under a budget model switch, Shelby County Schools would focus more on the types of students in their buildings and less on the number of staff per school.

Educators generally agree that a one-size-fits-all approach to teaching doesn’t work. Now school leaders in Memphis are saying it doesn’t work when distributing money to schools, either.

Beginning this July, Tennessee’s largest district will pilot student-based budgeting at up to eight schools, with the expectation of expanding to the entire district in three years. The goal is to distribute money more equitably.

Under the new method, each student brings to their school a certain dollar amount, which can grow based on factors like whether the student has a disability, is an English language learner, or comes from a low-income family.

That’s a big change from traditional budgeting, which distributes money primarily based on how much it costs to pay the salaries of adults who work in a building. The traditional model usually allocates less money to schools with high-needs students because they generally employ less experienced and lower-paid teachers.

The new approach would give principals more say in how they allocate money within their building. The system also appeals to those who want schools with greater challenges to receive more funding. And recently, student-based budgeting got a boost from President Donald Trump, whose proposed budget includes $1 billion in incentives for school districts with poor students that make the switch.

Leaders with Shelby County Schools have been working for more than a year with Education Resource Strategies, a Massachusetts-based consulting organization, to lay the groundwork for the transition. The method already is being used in districts in Nashville, Indianapolis, Denver, Boston and Houston.

David Rosenberg, a partner at Education Resource Strategies, said traditional budgeting models cater to the most politically savvy principals who find funds for academic programs and interventions in system loopholes. Student-based budgeting changes the dynamic to empower principals, making them more like CEOs than strict academicians. It also means principals will have to learn more about the complexities of budgeting.

“It works because you make it more flexible for schools and teams for how they see fit within parameters the district provides,” Rosenberg said.

During the next few months, the Memphis district will analyze how money is being allocated to its schools — which ones don’t have enough funds and which ones have too much under the new formula. The change will create winners and losers, and it’s the losers that concern some school board members.

PHOTO: Caroline Bauman
Lin Johnson, finance chief of Shelby County Schools

The board is generally supportive of student-based budgeting and is scheduled next week to vote on a resolution endorsing it. But board members also want the transition to be as painless as possible in a district that they say is underfunded by the state.

Finance chief Lin Johnson reassured board members at a work session this week that the district can mitigate losses for schools with less money. Options include tapping a separate pool of money to lessen the shock and giving some schools an extra year for the transition.

“The goal is not to fund all schools equally, but equitably (and) to make sure the funding we have is meeting the unique needs of students,” he said. “We need to work with schools to provide training and examples, to give schools the support they need to maximize the resources that they have.”

In Metropolitan Nashville Public Schools, which fully switched to student-based budgeting 2015, about 60 percent of schools received more money than the previous year. The rest received the same amount.

In other districts, the model has had the effect of shaking up central office structures, increasing the need for fiscal oversight, and stretching principal capacity.

Below is a video from Nashville’s school district to explain how student-based budgeting was rolled out there.

Follow the money

Audit: NYC issued $2.7 billion in noncompetitive education contracts — and often violates its own rules

PHOTO: Alex Zimmerman
City Comptroller Scott Stringer criticized the city's ability to keep track of education technology in July.

The city’s education department routinely violated state law and its own policies in issuing contracts worth billions of dollars — mostly awarded without a competitive bidding process.

That’s according to a blistering audit released Friday by city Comptroller Scott Stringer, the first major audit to scrutinize contracting by the de Blasio education department. It found that the department issued $2.7 billion contracts without a competitive process in fiscal year 2016, or roughly 64 percent of all spending on contracts.

The education department routinely failed to properly oversee its vendors, paid them late, and often directed them to begin work before proper paperwork was filed with the comptroller’s office, according to the audit.

“This investigation shows that DOE acts as though the rules don’t matter,” Stringer said in a statement which included 20 recommendations to fix the process. “When it comes to contracting, this is an opaque agency that refuses to accept responsibility, that often uses inaccurate arguments to defend backwards organizational practices.”

Some highlights:

  • Out of 521 “limited competition” contracts, the city directed vendors to begin work before filing appropriate paperwork on 85 percent of them. In one case, a contract was filed two and a half years after the vendor began work.
  • The education department did not correct sloppy oversight of vendors, despite a 2015 audit that urged them to do so. In some cases, “there was no evidence the DOE conducted performance evaluations, as required by the DOE’s own procurement rules,” the audit found.
  • The DOE spent $2 million to pay for “goods or services that had already been improperly purchased in violation of DOE’s procurement rules.”

Stringer’s findings come less than a month after the comptroller blasted the city’s management of education technology in a separate audit that found the education department has lost track of thousands of computers and failed to create an appropriate tracking system for them. Stringer’s harsh criticisms of Mayor Bill de Blasio’s education department come shortly after endorsing the mayor’s re-election bid.

The Bloomberg administration also faced sharp criticism for awarding contracts without soliciting competing bids. The administration’s critics said the mayor was inappropriately applying business practices to public spending. But Joel Klein, Bloomberg’s longest-serving chancellor, dismissed the criticism, saying he’d “never seen [an audit] that didn’t say you couldn’t follow procurement rules a little closer.”

Will Mantell, an education department spokesman, said the city’s procurement process is “rigorous” and “many of this audit’s conclusions are incorrect.”

“We perform background checks on all vendors and post them online, maintain the appropriate documentation on procurements, and recently implemented an electronic performance evaluation system,” Mantell added.

legal action

Lawsuit over poor conditions in Detroit schools gets its first day in court, as state officials seek to end it

PHOTO: Public Counsel
Attorneys behind a new federal civil rights lawsuit meet with Osborn High School college advisor Andrea Jackson and student Jamarria Hall.

A lawsuit filed nearly a year ago over the conditions in Detroit schools had its first day in court Thursday, but it could be a month before a judge rules whether it can proceed.

The suit, filed in September on behalf of seven Detroit students, argues that Gov. Rick Snyder and state education officials have deprived city students of their right to literacy by not spending adequately on local schools.

The 136-page complaint paints a bleak picture of life in the city’s schools, describing condoms strewn on playgrounds, bathrooms leaking sewage into hallways, students left to grieve without support, and classrooms without qualified teachers. The suit claims that these conditions make learning difficult in Detroit schools — a conclusion that a recent study bears out.

Snyder petitioned in November to have the suit dismissed, arguing that the condition of Detroit’s schools isn’t the state’s fault. The hearing today focused largely on that question, and the judge in the case, Stephen Murphy, said he would rule within 30 days on whether to let the case move forward.

State-appointed emergency managers ran Detroit’s schools directly for six years, until one year ago, and union leaders issued a statement Thursday laying the blame for local schools’ struggles solidly on state officials.

“The state created these poor learning conditions, and now Gov. Rick Snyder and Attorney General Bill Schuette are further abdicating their responsibility to the children of Detroit by moving to dismiss this case,” said the leaders of the Detroit, Michigan, and national chapters of the American Federation of Teachers. “All these children and families are asking for is what we owe all families — great, well-resourced public schools where parents want to send their kids, teachers want to teach, and children are engaged.”

If the case does move forward, it could take years to resolve. School funding equity cases —  currently pending in more than a dozen states, including Tennessee and New Mexico, where arguments ended earlier this month — typically take years to wend their way through the courts.

Detroit schools chief Nikolai Vitti, the first superintendent hired by the new locally elected school board, told Chalkbeat that Michigan does need to spend education dollars differently.

“I don’t think the state has recognized that simply providing equal funding or near-equal funding for all children in the state of Michigan on a per pupil basis does not go deep enough and broad enough to address the issues and challenges that children in Detroit face,” he said. “There is a need for a deeper weighted formula that recognizes [special education] status, [English Language Learner] status and poverty. That would give educators in Detroit more confidence that the state is supporting the children of Detroit differently than those throughout the state.”

But he said he found the lawsuit’s core allegation, that the state had deprived city students of a right to literacy, more complicated. “It’s not the state’s responsibility in and of itself,” Vitti said. “The school district, community partners, teachers, the faith-based community, the business community — everyone has to put shoulder to the wheel when talking about literacy.”