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Where Has All the Money Gone?
Do Traditional Pennsylvania Public Schools Suffer an Edifice Complex?
June 21, 2007
Primary Researcher: Robert Maranto, PhD, Adjunct Scholar (Associate Professor of Political Science, Villanova University) Nathan A. Benefield, Director of Policy Research Jason O’Brien (MPA candidate, Villanova University) Commonwealth Foundation for Public Policy Alternatives
Following are a few highlights of the “Edifice Complex” study funded by the Commonwealth Foundation. Headlines and underlined passages have been added for clarity, and some wording has been condensed. For the complete original study, go to http://mail.commonwealthfoundation.org/pr19-02.pdf
Cybers are more efficient
There is evidence that cyber charters use their resources more efficiently than do traditional public schools. Cyber charters get significantly less funding than the $11,485 that traditional Pennsylvania public schools spend per-pupil. Cyber schools spend, on average, $8,137 per-pupil—only 71% what school districts spend. Even taking away construction and debt, cyber schools get far less funding for current expenditure, spending only 77% what school districts do. Cyber school compensate for a lack of funding by focusing on instruction and student services, rather than buildings and administrative costs—98% of cyber school’s money goes to instruction and support services, compared with just 87% for traditional public schools.
Pa. spends $21.8 billion in K-12 education, 3rd highest in nation
In the United States, the public educational industrial complex dwarfs even the military industrial complex in size, with 50 state boards of education, more than 14,000 local school districts, over $450 billion in taxpayer expenditures, and employing more than three million teachers alone. Pennsylvania public schools spend more than $21.8 billion annually, serving 1.8 million students and employing 255,000 teachers, support staff, and administrators (slightly less than half are classroom teachers). In Pennsylvania, per-pupil K-12 public education spending, controlling for cost of living, is third highest nationally, behind only Wisconsin and Minnesota. Yet Pennsylvania students score only about average on the U.S. Department of Education’s National Assessment of Educational Progress (NAEP) standardized tests, which are often referred to as the “nation’s report card.”
From the 1986-87 to the 2005-06 school years, Pennsylvania taxpayer spending on government-run K-12 schools increased from $6.6 billion to almost $22 billion—a 72% increase after adjusting for inflation. Current spending costs nearly $4,400 in state, local, and federal taxes per Pennsylvania household. Between 1996-97 and 2005-2006, Pennsylvania’s public schools have added over 43,000 staff—teachers, administrators, and support staff—while enrollment increased by only 26,000. Thus, for every new student, schools added 1.6 staff. But can $21,827,691,342.60 buy a quality education for all students?
Pennsylvania continues to rate near the bottom in SAT scores, finishing 47th among the states in average total score in 2006. Among the 13 states (including DC) with a 70% or higher participation rate, Pennsylvania ranks 11th in average SAT Score.
School Districts Suffer ‘Edifice Complex’
Many school districts suffer an “Edifice Complex”, putting buildings ahead of teachers and kids. To cure the Edifice Complex, increased cyber schooling, as demonstrated in Pennsylvania’s 11 cyber charters, helps children by putting public money where it belongs—in teachers and instructional materials rather than in “Taj Mahal” buildings . . .
Two categories of spending that certainly are not linked to performance are spending on luxurious buildings and additional bureaucrats—yet these categories continue to grow as a percentage of total education spending. From 1996-97 to 2005-06, overall public school spending increased 59% (32% after adjusting for inflation)—a 51% increase in instructional expenditures, a 62% increase in administration and support services, and a whopping 103% increase in spending on construction and debt. During this time, construction spending increased from 8.7 to 11.3% of total expenditures, while instructional spending declined from 60% to 57%.
According to the Pennsylvania Department of Education (PDE), Pennsylvania public school districts spent a mean of $11,377 per student in 2005-06, ranging from a low of $8,225 for the Valley View School District in Lackawanna County to a high of $21,316 for the Springfield Township School District in Montgomery County. Controlling for cost of living our public school expenditures are among the highest in the nation.
These spending trends help explain why increasing numbers of Pennsylvania parents choose cyber schooling. Nearly 12,000 students enrolled in our state’s 11 cyber schools in 2005-06. This represents an increase of 30% from the previous year, and a dramatic increase from about 1,300 students in 2001-02, the first year cyber schooling was made available to Pennsylvania school children. Nationally, 173 virtual charter schools serve 92,200 students in 28 states.
Cyber per-pupil cost: 71% of traditional schools
As the BellSouth Foundation reports, “the costs of operating a virtual school are about the same as those of a regular brick and mortar school, with less spending on construction and more on instructional materials, teacher salaries, and technology.
There is evidence that cyber charters use their resources more efficiently than do traditional public schools. Cyber charters get significantly less funding than the $11,485 that traditional Pennsylvania public schools spend per-pupil. Cyber schools spend, on average, $8,137 per-pupil—only 71% what school districts spend. Even taking away construction and debt, cyber schools get far less funding for current expenditures, spending only 77% what school districts do. Cyber school compensate for a lack of funding by focusing on instruction and student services, rather than buildings and administrative costs—98% of cyber school’s money goes to instruction and support services, compared with just 87% for traditional public schools. Even though cyber schools serve many hard to educate students, research suggests that they succeed. As Education Sector analyst Bill Tucker states:
The small body of research focused on the effectiveness of virtual K-12 schooling programs supports findings of similar studies on virtual courses in higher education. They find “no significant difference” in student performance in on-line courses verses traditional face-to-face learning.
School district enrollment is increasing despite cybers
Statistically, the average Pennsylvania public school district has 4,204 students (average daily membership for 2005-06 school year) and lost only approximately 31.7 students to cyber charter schools, about eight tenths of one percent. Only six of Pennsylvania’s 501 school districts have lost 2.5% or more of enrollment to cyber charters. Further, despite the growth of cyber schooling, in a recent three-year period (fall 2002 to fall 2005) the average school district gained 44.1 students, suggesting that for most districts increased cyber enrollment has not ended growth. Indeed for the 255 of 501 Pennsylvania public school districts which grew from fall 2005 to fall 2006, increased cyber enrollment may help school budgets by delaying or avoiding costly school construction and renovation projects.
Normal growth and decline in enrollments by demographic forces (birth, population decline) is more significant that from cyber charters. More than 100 Pennsylvania school districts added more than 106 students from fall 2003 to fall 2005, while more than 100 lost 58 or more students in the period. Each change dwarfs the growth in cyber charter student bodies in both size and speed. Surely if school districts have the administrative competence to adjust to normal demographic changes, they can similarly adjust to parent choices made to serve their children's needs. Related to this, cyber charters allow traditional public schools to have lower class sizes.
School districts keep 50% of funding from ‘lost’ cyber students
Statewide, cyber schools only receive about 73% of the funding, per-pupil, as traditional public schools. When a child leaves a traditional public school for a charter school (cyber or brick-and-mortar), the charter school receives a portion of the districts’ previous year per-pupil spending. This portion includes instructional and support services, but excludes transportation, construction, facilities, and many other expenditures. Thus, school districts keep a sizable percentage of their per-pupil expenditures for children leaving district schools. The state of Pennsylvania also provide reimbursements to school districts for children attending charter schools—on average about 25% of the cost to districts. In other words, school districts keep almost 50% of their previous year’s per-pupil spending for children who leave their schools. This gives the school district more resources for its other students—effectively increasing per-pupil spending. Again, Pennsylvania cyber charters typically receive a mean of seven to eight thousand dollars per child, compared to a mean of $11,377 for traditional public schools.