How Efficient is Your School Spending?

In a climate where schools are forced to do more with less, it’s tempting to assume that bigger budgets will directly benefit kids. After all, tighter school budgets often mean cuts in staffing, student services, sports and music.

The formula may not be that simple, however, at least not if we define “benefit” in terms of academic achievement. A recent analysis by the Center for American Progress questions the assumption that more money spent per pupil always equals better test scores. We should consider not simply how much is spent, but how that money is spent, the report says.

Return on Educational Investment: A District-by-District Evaluation of U.S. Educational Productivity, released in January 2011, measured “educational productivity,” defined as the academic achievement school districts produced relative to their educational spending.

“We believe this is the first national effort to gauge the efficiency of over 9,000 districts in more than 45 states against a set of evaluative rubrics,” said report author Ulrich Boser.

Districts’ productivity ratings took into account higher costs associated with serving larger concentrations of low-income, non-English-speaking and special education students. The study also assessed whether a district’s achievement was higher or lower than would be predicted after accounting for per-pupil spending and student and community factors beyond its control.

Boser said the study’s biggest surprise finding was that if low-productivity school systems spent their dollars more efficiently, many would see large gains in student achievement.

“Consider, for instance, California, where a low-productivity school district could see as much as a 25 percent boost in achievement if it increased its efficiency from the lowest level to the highest, all else being equal,” he explained.

Rather than putting schools under fire, Boser said, the concept of educational productivity could actually help preserve school budgets.

“At a time when states are projecting more than $100 billion in budget shortfalls, if schools don’t deliver maximum results for the dollar, public trust in education could erode and taxpayers may fund schools less generously.”

Additional key findings from the report included:

• After adjusting for factors outside of a district’s control, some districts spent thousands more per student to obtain the same level of academic achievement.
• The most inefficient districts in the country devoted an extra three percentage points of their budgets, on average, to administration, operations and other non-instructional expenditures.
• Over 400 school districts around the country were rated as highly inefficient, and more than a million students are enrolled in these districts.

So what can schools do to increase their educational productivity?

“Growth in student learning will not come without significant reform, since the programs and policies that cause low productivity are often systemic,” Boser said.

Some recommended strategies to increase productivity include providing educators with the tools, technology, and training that they need to succeed.

“Among other things, states should offer school administrators strategies on how to thoughtfully stretch their school dollar,” Boser said.

He added that states should develop funding policies where money follows students based on their needs, so that all schools and districts have an equal opportunity to succeed.

Ulrich Boser is a Senior Fellow at The Center for American Progress, a nonpartisan research and educational institute dedicated to promoting a strong, just and free America that ensures opportunity for all. His writings have appeared in The New York Times, The Washington Post, Slate and Smithsonian.

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