School District Consolidation: Where are the Actual Savings and Potential Losses?

School district consolidation is a striking phenomenon not only in Atlantic Canada, but right across Canada and the United States. Two levels of consolidation, encompassing the merging of smaller schools and the collapsing of school districts, leads to the centralization of management. It also rests primarily on two presumed benefits: (1) fiscal efficiency and (2) higher educational quality.

With the recent release of Dr. Avis Glaze’s education restructuring report, Raise the Bar, a fierce public debate is underway in Nova Scotia focusing on her plan to dissolve the seven remaining English school boards, reassign administrators to the schools, and reinvest any savings in the classroom. Following that report, a CBC News Nova Scotia investigation revealed that the 38 school board administrators potentially affected earned $4.7 million a year. Whether her plan retaining the seven districts will yield much in the way of cost savings is very much in question.  The research, so far, is decidedly mixed when all factors are taken into consideration.

The sheer scale of district consolidation is staggering. Driven largely by the pursuit of financial economy and efficiency, district consolidation swept across the United States, reduced the number of K-12 districts from 117,108 in 1939-1940 to 13,862 by 2006-2007, a decline of 88 per cent. The rate of consolidation has slowed over the past decade, but at least a few districts consolidate every year in many states (Duncombe and Yinger 2010). While comparative Canadian data is not readily available, it is relatively safe to observe the existence of a similar pattern (Bennett 2011, Corbett 2014).

School district consolidation in Canada is driven by provincial education authorities looking for cost reductions, but in some cases, the trigger factor is eliminating local education authorities obstructing education initiatives. Provincial announcements authorizing educational restructuring, such as the 1996 Ontario School Reduction Task Force, justify the school district consolidation as a cost reduction measure and commit to redirecting any savings into the classroom (Ontario 1996). Declining student enrolments, demographic trends, out-migration, and duplicated functions are among the common factors cited in making the case for consolidation (Galway, Sheppard, Wiens and Brown 2013).

In some cases, such as Prince Edward Island, the prime justification is clarity of direction rather than any economic benefits. In October 2011, for example, the P.E.I. Education Governance Commission recognized that the evidence of “operational efficiencies and net savings” is mixed, based upon previous ventures in Prince Edward Island and elsewhere. “There is a risk,” the Commission report recognized, “that any savings that may result from elimination of duplication in some areas could be offset. Initially by transition costs, and in the longer term by rising expenditures in other areas such as increased specialization and more hierarchy.”   (PEI Governance 2011).

Most American state governments are more explicit about the incentives uses to nudge along the process of school district consolidation. The most common form of U.S. state policy is transition funding designed to encourage district reorganization, typically in the form of consolidation, by providing additional money for operations or capital projects during the transition to the new form of organization. The aid bonus from consolidation can be quite large. In the State of New York, consolidating districts may receive an increase in their basic operating aid of up to 40 percent for five years, with declining increases for an additional nine years.

On top of this aid, consolidating districts also may receive a 30 percent increase in building aid for projects initiated within 10 years of consolidation.  Possibly as many as one-third of all American states, including some with consolidation bonuses, still maintain countervailing policies that provide support to school districts for “sparsity” (or low population density) or for small scale operations, factors that work against consolidation (Duncombe and Yinger 2010).

Forecasted Savings

The prime justification for school district consolidation has long been that it is a way to cut costs. These cost savings arise, the argument goes, because the provision of education is characterized by economies of size, which exist whenever the cost of education per pupil declines as the number of pupils goes up. In this context, the cost of education is not the same as education spending but is instead the amount a school district would have to spend to obtain a given level of performance, as measured by test scores, graduation rates and perhaps other output measures. To put it another way, economies of size exist if spending on education per pupil declines as the number of pupils goes up, controlling for school district performance. Because consolidation creates larger school districts, it results in lower costs per pupil whenever economies of size exist (Duncombe and Yinger 2010).

Economies of size could arise for many reasons:

Indivisibilities: First, the school services provided to each student by certain education professionals may not diminish in quality as the number of students increases, at least over some range. All districts require a superintendent and the same central administration may be able to serve a significant range of enrollment with little change in total costs.

Increased Dimension: Second, education requires certain physical capital, such as a heating system and science laboratories, which require a certain scale to operate efficiently and therefore have a high cost per pupil in small districts.

Specialization: Third, larger districts may be able to employ more specialized teachers, putting them in a better position to provide the wide range of courses required by public accountability systems and expected today by students and parents.

Innovation and Learning: Finally, teachers in larger districts have more colleagues on which to draw for advice and discussion, interactions that presumably lead to improved effectiveness (Duncombe and Yinger 2007, 2010).

Potential Mitigating Factors
Popular assumptions about economies of size have been challenged by researchers focusing on the relationship between school and school district size and student performance and well-being. Rural education studies have demonstrated that the sizes of the school district and the high school are highly correlated and, in many cases, cost savings are rarely realized and larger schools can have detrimental impact upon student performance and engagement (Howley, Johnson and Petrie 2011). Effective schools research also tends to show that small to moderate-sized schools are more successful than mega-schools at retaining students through to high school graduation (Howley 2002). Leading American experts on school district consolidation William Duncombe and John Yinger have found that extremely large districts (those enrolling 15,000 or more students—are likely to be fiscally inefficient because consolidation has proceeded beyond the point of a favourable cost-benefit ratio (Duncombe and Yinger 2005, 2010).

Four sources of potential diseconomies of size are:

Higher Transportation Costs: First, consolidated school districts usually make use of larger schools, which implies that average transportation distance must increase. As a result, consolidation might increase a district’s transportation spending per pupil.

Levelling Up of HR Costs: Second, consolidating districts may level up salaries and benefits to those of the most generous participating district, thereby raising personnel costs.

Lowering of Staff Morale: Third, administrators and teachers tend to have a more positive attitude toward work in smaller schools, which tend to have more flexible rules and procedures.

Less Student and Parent Participation: Finally, students can be more motivated and parents more comfortable to interact with teachers in smaller districts, which tend to have a greater community feel. These reactions and closer student-faculty relationships may result in higher student performance at any given spending level. Longer school bus rides have a detrimental impact upon student engagement and achievement.

Overall, the net impact of consolidation on education costs per pupil is not always clear. Consolidation of tiny school districts of 1,500 students or less is likely to tap into economies of size and thereby lower these costs, but, beyond those numbers, consolidation might actually cause costs per pupil to rise (Duncombe and Yinger 2010). The most recent research literature review, published in 2011 by the U.S. National Education Policy Center, concluded that “claims for educational benefits from systematic state-wide school and district consolidation are vastly overestimated and, beyond school districts of 1,500, have actually been maximized years ago” (Howley, Johnson and Petrie 2011).

What happens to the projected savings forecasted in school district consolidation plans?  How does the education finance process work to obscure and conceal the data required to conduct a thorough cost-benefit analysis? What mitigating factors arise to compromise or nullify the forecasted savings?  Is it possible to assess the full extent of losses, financial and social, at the school level? What are the real lessons for those tempted to tackle education restructuring? 

Research conducted for this post is part of a larger project on Restructuring Education (Halifax: Atlantic Institute for Market Studies, 2018).

 

 

 

 

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School Size and Consolidation: How Big is Too Big?

The century-old trend towards school consolidation and ever bigger schools is driven by a peculiar logic. School consolidators, posing as modernizers and progressives, tend to rely upon a few standard lines. “Student enrollment has dropped, so we cannot afford to keep your small school open. Now don’t get emotional on us. It simply comes down to a matter of dollars and cents.”

What’s wrong with this conventional school planning and design logic?  A growing body of North American education research on the “dollars and sense” of school size is exploding the myth and now suggest that smaller scale schools are not only better for students but, more surprisingly, more cost effective for school boards.  Whereas school consolidation and “economies-of-scale” were once merely accepted truths, supported by little evidence, newer studies are demonstrating that true small schools also deliver better results in academic achievement, high school completion rates, student safety and social connectedness.

School sizes continued to grow until the first decade of the 2000s with little research support, coherent analysis, or public scrutiny.  One influential study, J.B. Conant’s 1959 book, The American High School Today, fed the growth hormone with a fateful recommendation that no high school should have a graduating class of less than 100 students.  High schools were then  increasingly consolidated and, in the United States, the number of high schools with more than 1,500 students doubled and, by 2010, 40 % of America’s high schools enrolled more than 1,000 students.

The most popular, safest and single most effective model of schooling, the small schools model, was not only overlooked but effectively marginalized by policy makers and school facilities planners. Independent scholarly research in support of smaller schools, especially for secondary school students, gradually began to surface.  Such empirical research, however, rarely made it to the table where policy is made –in the ministry of education, superintendent’s office, school architect’s workplace, or even the university faculties of education.

One of the first studies to challenge the prevailing orthodoxy was Dollars & Sense: The Cost Effectiveness of Small Schools (Knowledge Works Foundation, 2002).  Written by Barbara Kent Lawrence and a team of recognized experts, it very effectively demolished the central arguments made by large school defenders based upon so-called “economies of scale.” Small schools, the authors, claimed actually cost less to build based upon the metric of cost per student. They made the compelling case that large schools, compared to small  schools, have:

• Higher administrative overhead
• Higher maintenance costs
• Increased transportation costs
• Lower graduation rates
• Higher rates of vandalism
• Higher absenteeism
• Lower teacher satisfaction

In addition to dispelling myths about “economies-of-scale,” the authors proposed specific guidelines for Ideal School Sizes, specifying upper limits:

High Schools (9-12), 75 students per grade, 300 total enrollment

Middle Schools (5-8), 50 students per grade level, 200 total enrollment

Elementary Schools (1-8), 25 students per grade level, 200 total enrollment

Elementary Schools (1-6), 25 students per grade level, 150 total enrollment

The authors of Dollars & Sense also rejected claims that the benefits of “smallness” could be achieved by designing and creating “schools-within-a-school” (SWaS). They recognized that turning over-sized facilities into SWaS design schools may be practical, but recommended against designing new schools where large numbers of students (Grades K-12) were reconfigured into divisions in particular sections or linked buildings.

Craig B. Howley’s landmark 2008 Educational Planning article, “Don’t Supersize Me,” provided the concrete evidence that building small schools was more cost effective.  Comparing 87 smaller Grade 9-12 schools with 81 larger schools, his research demonstrated that the smaller schools (138 to 600 students) were, on average, no more expensive per student to build than the larger schools (enrolling 601-999 students), and were actually less costly per square foot ($96 vs. $110). Furthermore, the new planned larger schools were oversized when actual enrollments were considered, making them more expensive per student, the key cost metric.

During a nine year period, from 2000 to 2009, the Bill and Melinda Gates Foundation took a $2 billion run at the problem with mixed results. “Comprehensive” high schools were declared harmful to the academic advancement and welfare of American students.  Mega-high schools with as many as 4,500 students educated under a single roof were found to be breeding apathy, sapping students’ motivation to learn and teachers’ commitment to teaching. Beginning in 2000, the Gates Foundation poured some $2 billion into replacing these dropout factories, funding 1,600 new, mostly urban high schools of a few hundred students each, some of them in restructured comprehensive high schools, others in new locations.

The massive Gates Small School initiative, centred on Portland, Oregon, ran into structural barriers, sparked teacher union resistance, and  did not produce quick results.  Trying to re-size schools and re-invent decadent school cultures proved more challenging than expected, and the Gates Foundation ran out of patience when student test scores remained stagnant. “Many of the small schools that we invested in did not improve students’ achievement in any significant way,” Bill Gates wrote in 2009. The foundation then made a sharp turn and shifted its attention and resources to teacher quality reform strategies.

The campaign for more personalized urban and regional high schools—structured and designed to forge more meaningful connections between students and adults in a concerted effort to boost  student achievement—is still supported by a raft of research and student and teacher surveys. American  authorities on student dropouts consistently report that students don’t care because they don’t feel valued. “When adolescents trust their teachers … they’re more likely to persist through graduation,” claims University of Michigan’s Valerie Lee and a colleague.

The Gates experiments did provide some vitally-important lessons.  Reducing school sizes alone is not enough to turn around under-performing schools. In the case of New York City, shutting down twenty large, under-performing high schools worked better in improving graduation rates (from 47 to 63%) because the principals of the 200 new smaller schools that were created as replacements had the power to hire their own teachers and staff.

The Knowledge is Power Program (KIPP) charter schools, created on the “small school ” model also fared much better than the mainstream reconfigured urban high schools.  Principals and teachers at KIPP schools, for example, pride themselves on knowing every student’s name—something the schools are able to do mostly because they’re small, with average enrollments of 300.  Even in his 2009 critique of the Small Schools Initiative, Bill Gates praised the small-scale KIPP schools. Their strong results may reflect the combination of smaller size, high standards,  longer school days, and employing their own teachers and staff.

Creating smaller schools and a more intimate school climate in the absence of high standards and good teaching isn’t enough.  There’s no guarantee that small schools, in and of themselves,  will create good climates.  Having said that, smaller schools are more likely to create the sense of connectedness among students and teachers that motivates them both to work hard, according to the Dollars & Sense researchers.  Generating a level of genuine caring and mutual obligation between students and teachers is also found far less frequently in large, comprehensive high schools. Small schools, in other words, are more likely to create the conditions that make learning possible.

Writing in the Washington Monthly (July 6, 2010), Thomas Toch put it best.  Breaking up large dysfunctional high schools into smaller units may not work miracles, but is likely a step in the right direction. Smaller school settings are still proving to be one of a number of important means to the desired end:  getting students and teachers in impoverished neighborhoods or marginalized rural communities to invest more in their work still looks like the best route toward “lifting achievement” and getting “a far wider range of students” through high school and onto post-secondary education.

How big is too big when it comes to schools?  Why do ministries of education and school boards continue to subscribe to the myth of “economies of scale”?  What were the painful lessons of Bill and Melinda Gates’ 2000 to 2009 Small School Initiative project?  What can be done to bring public policy in relation to school size more in line with current research supporting the building of smaller schools and the re-sizing of  regional mega-schools ? 

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Community Hub Schools: Will School Savers Succeed in Lifting the “Iron Cage”?

School closure battles are raging, once again, in Canadian rural and urban inner city school districts, putting local communities through another endurance test. In Nova Scotia, small villages like Petite Riviere, Maitland, River John, Wentworth, and Mill Village  are fighting to keep both their elementary schools and communities alive.  Out West in Regina, urban reformers associated with Real Renewal are continuing their battle, now focused on saving the historic Connaught School in the Cathedral District.  In central Canada, the City of Kingston is the epicentre of the struggle to save downtown community schools like the venerable Kingston Collegiate and Vocational School from extinction. All of the disparate groups share one key objective – lifting what Toronto school reformers David Clandfield and George Martell recently termed the “iron cage” around our public schools.

Something is definitely stirring in rural and small town Nova Scotia.  Community resilience is emerging from the bottom- up, as grassroots community groups, one-after-another, are rejecting the provincial closure agenda and embracing a Third Option – transforming their under-utilized small schools into “community hubs,” building around an “anchor tenant” – the P-6  population of students and teachers.  Instead of accepting the law of demographic gravity, they are organizing to re-build their communities and looking to the school boards to join in that project.

To save small communities, start by saving their schools.  That sounds like common sense but it runs counter to the “Bigger is Better” mentality of provincial and school board facilities planners. Saving inner city neighborhoods and  plugging the rural population drain should be more of a priority.

Look around Canadian cities and outlying remote rural areas.  Who is standing up for maintaining the integrity of the urban core?  Without rural schools, where will the children and families come from to re-generate the declining rural economy?  Without them, how long do communities survive?

Impact Assessment Reports, following the Department of Education formula, direct school committees to choose between two losing propositions – the status quo or further consolidation. The “Big Box” school plan down the road is usually the carrot.  In a few cases, the second option is worse, splitting up school families and busing them to scattered sites over poor country roads.

Regina school reformers were quick to recognize the potential of the Community Hub model for breaking the cycle and transforming school communities.  More recently, Nova Scotia School Study Committees at Petite Riviere, Maitland, and River John declined to play that losing game and generated their own community-based Third Options.  Not content to seek a reprieve, they got busy and produced incredibly innovative, community-building activities to fill the empty spaces and ensure the long-term sustainability of their schools.

What is this new species known as a “Community Hub School?”  “A community hub,” according to leading advocate Dr. David Clandfield, is “a central gathering place for people, their activities, and events. “

It’s more than just “a high-use multipurpose centre” and more of  “a two-way hub” where “children’s learning activities within the school contribute to  community development” and, in turn, “ community activities contribute to, and enrich, children’s learning within the school.”

Integrating centralized child, youth, and family services into the schools (as is the case with the Saskatchewan SchoolPLUS or Nova Scotia SchoolsPlus model) is only a small part of the equation.  A true community hub is a genuine partnership, building around the schools and drawing far more upon local, volunteer, and community enterprise.

Once popular myths about “Bigger is Better” consolidation ventures are being exploded at every “Public Hearing.”  Small schools are living examples of “personalized learning” and not just the theme for a cutting edge PD program.  Renovating small schools is far more cost effective than building new oversized facilities with the overblown capital, infrastructure, and transportation costs factored in.  Local taxpayers do not ultimately win when the costs of maintaining or disposing of abandoned schools are downloaded on rural municipalities.  Putting young kids ages 4 to 10 on buses for from 2 to 3 hours a day is not only very unhealthy, but puts them at higher risk of bullying and is nonsensical in the digital age.

Public hearings in Petite Riviere, Maitland, and River John turned out virtually the entire community.  Speaker after speaker asks – who here is actually in favour of “Big Box” elementary proposals and busing elementary kids to such distant schools?  The answer – No one, except perhaps for battle-worn board staff suffering in silence.

What would a Community Hub School look like?  The Maitland Plan would open the school to community partnerships and lease excess space to NSCC Truro for continuing education programs, expand Boy Scout activities, and serve as a base for CHARTS, the East Hants arts festival group.  Up in River John, the Study Committee has secured the return of the RCMP office, a local film-maker, FLAWed Productions ,  the SCORE Pre-School program, and the support of Maritime children’s author Sheree Fitch.

The Petite Plus plan is the most adventuresome and exciting, embracing innovation, local artists, and videoconferencing. With a $2 million renovation, the Petite Plus plan saves local taxpayers between $6 million and $8 million of the cost of a new Big Box elementary school.

Putting facilities first is not a winning strategy if we are truly committed to building “learning communities.” A Third Option is the best way forward because it challenges school communities themselves to come together, to develop their own Community Hub plan, and to breathe new life into public education.  Thinking small, dreaming bigger, opening the doors, and turning small schools into community hubs is now the wave of the near future.

Why are Community Hub School proposals gaining public support and traction?  Who is really opposed to giving local communities a chance to organize a plan for community regeneration?  Will the rising Community Hub School movement succeed in lifting the so-called “iron cage” around the public school system?

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