Chapter 1Misconceptions

about School Finance

The Truth Is… Education has

never been a high prestige, high paying profession in the United States.

Teaching has always been a difficult, demanding, and poorly resourced profession that swayed in local, state, (and increasingly since the 1980s) national political winds. Education’s “Good old days” never existed beyond the founding fathers’ dreams.

Federal Involvement in Education has been

Supportive

• Public education’s importance to our national agenda and economy makes it a logical political focus

• Federal involvement in schools, however, is largely subject to

political winds

American Public Education is Big Business*

1999-2000:Operating budgets of all

public K-12 education totaled more than

$373 billion.

Employing approximately 3,000,000 teachers.

Also, in Fall 2001:1.6 million

administrators, counselors, paraprofessionals, or support staff.

53.2 million public school students.

* U.S Department of Education, National Center for Education Statistics, “Revenues and Expenditures for Public Elementary and Secondary Education: School Year 1999-2000.” http://www.policyalmanac.org/educationa/archive/doe_education_spending.shtml.

American Public Education is Big Business

• K-12= 4.3% GDP*

• K-16 = 7.1% GDP

*GDP = Gross Domestic Product – the total output produced within a country during a year.

If Public Education Were a National Company, in 2001…

With 4.6 million employees, public education has

5 X’s MORE than those working for GM, GE, & IBM

COMBINED!!![1] U.S Department of Education, National Center for Education Statistics, “Revenues and Expenditures for Public Elementary and Secondary Education: School Year 1999-2000.” http://www.policyalmanac.org/educationa/archive/doe_education_spending.shtml.

Education-Bashing Has Become Fashionable

The data show that American schools have never been asked to do more with fewer resources under a higher level of public scrutiny – and with a higher level of expectations – than any other time in our history*. *Bracey, G. Setting the Record Straight: Responses to Misconceptions About Public Education in the United States. ASCD, Alexandria, 1997 and Berliner, D., Biddle, B. The Manufactured Crisis: Myths, Fraud, and Attack on America’s Public Schools, 1995, Longman, New York.

The “Good Old Days”?

1950:33% of US population were high school graduates12.6% African-American Males14.7% African-American FemalesFew special needs students

TODAY:All studentsMore diverse students –

AbilityRaceEthnicitySpecial NeedsLow SESAnd so on….

5 Misconceptions About Education Finance:

1. Our country spends more on education than any other country. 2. Education costs have recently skyrocketed.3. Spending more money on education does not

mean better student achievement results.4. Education salaries are high in relation to other

similarly trained professions.5. Education today employs too many

administrators.

MISCONCEPTION #1 – THE UNITED STATES SPENDS MORE ON EDUCATION THAN ANY OTHER COUNTRY.

This is not true for public education (K through grade 12). It is only true if you look at total dollars spent including higher education.

 

Placing “Dollars” Into a Cultural Context

Figure 1.1 - Educational Expenditures per Student in Relation to GDP per Capita, by Level of Education for Selected OECD Countries: 1998

What Should Be Said…

Comparing total dollars spent on education without equalizing dollars for cost of living is not comparing “apples to apples”.

To Compare “Apples” to “Apples”

Examine not the actual dollar amounts spent for education on a per pupil basis, but the percent those dollars represent as a portion of the entire country’s economy.

Equalizing Currency

GNP – Gross National Product: The total value at current market prices of all goods and services that a country produces during a year.

GDP – Gross Domestic Product: The total value of all output by all factors owned by the country regardless of where the production takes place.

Understanding Spending in Its Relative Place

• Examine not the actual dollar amounts spent for education on a per pupil basis, but the percent those dollars represent as a portion of the entire country’s economy

• Another way to equalize dollars and make reasonable international comparisons

Relative Standards of Living

To compare U.S. dollars to the equivalent currency in Mexico, Poland, Hungary, and the Czech Republic (see next slide) would be inaccurate and inappropriate.

Educational Expenditures per Student in Relation to GDP per

Capita

Figure 1.1 - Educational Expenditures per Student in Relation to GDP per Capita, by Level of Education for Selected OECD Countries: 1998

U.S. Education Spending is Comparable* to Other “First World” Countries’ Spending

*Without the RED boxes which represent post-secondary (college) education.

Comparing International Spending: Salary Differences

• Unless these dollars are equalized to account for a relative standard of living, the comparisons will not be valid

• Variations in costs of living in different countries

• National vs. local salary schedules

• Local wealth in suburban, urban & rural communities

• Geographic location

It is Important to Remember…Virtually no other country provides a free and appropriate education to all of its children from kindergarten through grade 12 and from ages two to twenty-two for students with special needs.

That alone will increase the average spending per student on a per capita basis in comparison with other countries.

Education Finance in a Cultural Context

U.S. GDP is far ahead of most other countries. This indicates that our relative wealth and standard of living is high in relation to the other OECD nations.

U.S. education spending is not commensurate with our relative wealth.

The US Makes an “Average Effort” to Finance Education

• The United States spends approximately 5.1% of its gross domestic product on education

• We rank 10th among seventeen “First World” OECD countries listed with the data

These 17 countries’ mean education expenditure is 5.4%.

% of GDP Spent on Education

France – 6 %

United Kingdom - 4.9%

U.S. - 5.1%

Japan - 4.2%

Canada - 5.7%

Sweden - 8%

Mexico - 4.2%

A Positive Correlation Between GDP per Capita & Education

Wealthier countries tend to spend more on primary, secondary, & postsecondary students than do less wealthy countries.

1998, OECD Members

Denmark $6713

USA $6043

Mexico $863

Switzerland $9348

USA $7767

Elementary, per pupil

Secondary, per pupil

Poland $1438

As Measured by GDP,

The U.S. is among the lowest spenders for secondary education. Our

financial effort is relatively

low while our financial

capacity is

very high.

US Does NOT Spend More

• U.S. spending on K-12 education in equalized dollars is less than that of sixteen other industrialized countries

• An equalized comparison would show that in terms of wealth, as measured by GDP, our spending places us 10th – below the average – of 17 OECD countries.

MISCONCEPTION #2 –EDUCATION COSTS HAVE SKYROCKETED WHILE TEST

SCORES HAVE GONE DOWN

Education Costs Are Up Because Enrollments Are Up

• U.S. education costs in real and constant dollars have increased, but so have enrollments

• We have also decreased class size, resulting in an increase in teachers and subsequently, costs

Teacher Salaries in Real Dollars Have Increased

Salary scales pay teachers for years of service and earning advance degrees. In constant dollars, however, their salary’s purchasing power is almost flat.

Greater Variance In Students’ Needs Costs More

1975, Education for all

Handicapped Children Act From the 1976 school year until the

1999 school year, public schools served

an additional 2.5 million special education students

Special Needs Students

The lower student/teacher ratio and additional resources required to appropriately educate special needs students necessarily requires larger expenditures.

Special Education Costs In 1988, it cost $2500 to educate each regular education

pupil while it cost $17,600 to educate each special education pupil.

Bracey, G.W. (1991, October) “Why Can’t They Be Like We Were?” Phi Delta Kappan 73 (2): 104-117, p. 112.

Special Needs Students Served as a % of Enrollment

1976-77 3.6 million 8.32% 1980-81 4.1 million 10.14% 1989-90 4.6 million 11.32% 1994-95 5.3 million 12.19% 1999-00 6.1 million 13.22%

Test Scores are NOT Declining

SAT scores have NOT declined during a period of increased expenditures.

In High-Scoring SAT States, Virtually No One Takes the SAT State % of 1993 HS Seniors taking SAT• Iowa 5%• North Dakota 6%• South Dakota 5%• Utah 4%• Montana 10%• New Jersey 76%

Looking at Test Scores & Expenses

Making judgments about the inverse relationship between money input & student achievement output is simply invalid.

We do not have a level playing field because of the vastly different student populations taking (or not taking) this particular college admissions test.

PLUS, SAT Scores are NOT Decreasing!

On the SAT from 1991 to 2001,

all* ethnic groups showed

an increase from 3 to 20 points

on Math and a 2 to 21 point

increase in Verbal. * Only Mexican Americans showed a 1 point drop in Math and a 3 point drop in Verbal.

SAT Scores are Increasing !

The average increase for all college-bound seniors was a 14-point increase in Math & a 7-point increase in Verbal.

.

SAT Scores Went Up Between 1991 & 2001

In spite of the fact that minorities traditionally score lower than white students, they consisted of more than 1/3 of all SAT takers in the class of 2001.

Statistical Issues Confuse SAT Results

Converting to scaled scores can confuse the general public

One incorrect answer can account for about 10-scaled score points on the test

Miss 1 question on the Verbal part & lose 50 scale points for that one error, earning a score of 750 rather than 800

Achievement scores are NOT going down

To a case, where states have

implemented high-stakes testing programs, test scores have increased, especially for disadvantaged and minority students.

SAT’s History Helps Explain the Change in Scores Over Time

The SAT began in 1926 as a way to distinguish among applicants for selective colleges.

Norms were established on 8,040 students entering private colleges, mostly in the Northeast; students were 98% white, 60% male, 40% attended private high schools.

Other Achievement Scores Increasing

Likewise, the National Assessment of Educational Progress (NAEP – “The Nation’s Report Card”) scores from 1971 to 1999 (latest data available

at the time of writing) show that student scores are increasing.

Data: NAEP 1998Effective Teaching & Minority Achievement

• Grade 8 Writing:– African American

students:– 146 points – Texas– 121 points – Arkansas

**A 25-point difference worth 2 ½ years of learning.

• Grade 8 Writing:– Latino students:

– 146 points – Virginia– 106 points – Mississippi

** A 40 point difference worth 3-4 years of learning.

Haycock, Jerald, & Huang, 2001. “Closing the Gap: Done in a Decade.”Thinking K-16, 5 (2). Washington, DC: The Education Trust (Spring 2001):3-22.

Increasing NAEP Scores1971 – 1999 Average Student Reading Proficiency by Age:

1971 1999 Change9 year olds 207.6 211.7 4.1 pts.13 year olds 255.2 259.4 4.217 year olds 285.2 287.8 2.6

Test Scores Do NOT Compare “Apples with Apples”

US has open public education for all students, including special needs.

US does not track students into early career decisions and apprenticeships and out of college preparatory education.

All US students can be tested. Tests’ contents do not closely match what

most students learn in U.S. classrooms*.

Other Cultural Differences that Impact Test Results

European & Asian students have a longer school day (average 6 hours to our 5.2 hours) & school year (200 to 225 days compared to our 178 days).

Many European nations have a national education system (& a consistent school finance structure).

Cultural Differences Impact Test Results

A growing underclass & at-risk

population present in U.S. public schools:

40% Free & Reduced Price Lunch

More than 50% of American

students live with a single head of household

American students average 3.5 hours of TV viewing

A less stable and experienced U.S. teaching force for neediest students

Differences in National Education Spending Are Misleading

Educational costs in the U.S. may be so variable as to insufficiently support many of the neediest students, leaving them less prepared to perform well on rigorous tests.

• The variance ranges from a high of more than $9,500 per pupil in the four highest spending states to a low of between $4,001 to $4,500 per pupil in Utah

• Comparisons within states frequently show even greater variance than state comparisons

Unequal Spending Within States

Wealthier school

districts usually outspend poorer school districts by

a wide margin.

The poorer school districts tend to be the urban poor and the isolated rural districts with great demands and few available resources.

In Sum,Test Scores & Costs are Up

As seen, education costs in real dollars have increased over the past several decades, but, contrary to popular argument, test scores have not uniformly declined.

Increased costs are associated with increased enrollments, lowered student/teacher ratios, higher teacher salaries, & the extra learning needs that more diverse students bring to school.

MISCONCEPTION #3 -SPENDING MORE MONEY ON EDUCATION DOES NOT MEAN

BETTER ACHIEVEMENT RESULTS

Money Matters!

Hiring quality teachers Decreasing class size Improving facilities Having adequate

resources & support services Providing up-to-date equipment

Spent Correctly, Money Makes a Big Difference in Student

Achievement• An Alabama

Department of Education study, for example, showed a positive relationship between money spent and student achievement*

• A Harvard study showed money spent to reduce class size and to hire experienced teachers resulted in increased student test scores**

Critics Argue That Money is Not Related to Achievement

• The Coleman Report (1966) said schools had minor impact on students’ learning apart from what children brought from their family backgrounds

• Educationally-speaking, the rich would get richer and the poor would learn but never as much as their more affluent classmates

The Coleman Report

This naïve belief – seeming logical at the time and well before 1990s research data on teaching effectiveness appeared – greatly influenced the public culture about schools’ effectiveness.

$$$$ and Achievement

For many, this was a rationalization not to spend more for schools in lower socio-economic areas because it would simply do no good.

$$$$ and AchievementLarry Hedges and others* reexamined Hanushek’s data and found, instead, overwhelming

evidence that school funding had a positive impact on student achievement.

Hedges stated that if a school district spent $500 more per pupil wisely, students would gain an average of 25 percentile points more on achievement tests .

Evidence That $$$ Increases Student Achievement

13

%ile Difference in 10th Grade.Students’ Scores:

Eff ective Teachers I neff ective Teacherstop 1/ 3 best teachers lowest 1/ 3 teachers

Sept. ….Same Scores in Reading & Math…..

June Above national No growth

medianHaycock, K. “Good Teaching Matters… A Lot,” Thinking K-16, 3 (2), Washington, D.C: The Education Trust (Summer 1998).:

Evidence That $$$ Increases Student Achievement

11

35%ile Difference in Students’ Reading Scores:

Eff ective Teachers I neff ective Teachers

(For 3 consecutive years)

• Grade 4 59%ile 60%ile

• Grade 5

• Grade 6 76%ile 42%ile(similar study f ound a 49%ile point diff erence in Math)

Archer, J. (1998, February 18). Students’ fortune rests with assigned teacher. Education Week. Cited in

Haycock, K. (Summer 1998). Good teaching matters. How well-qualified teachers can close the gap Thinking K-16 Vol. 3. No. 2 1-14. [Online}. Washington, DC: The Education Trust. Available: http://www.edtrust.org

Evidence That $$$ Increases Student Achievement

12

50+%ile Difference in Students’ Math Scores:

Eff ective Teachers I neff ective Teachers

(For 3 consecutive years)

• Grade 4 no difference -- no difference

• Grade 5

• Grade 6 83%ile 29%ile

Sanders, W.L. and Rivers, J.C. (1996, November). Cumulative and residual effects of teachers on future student academic achievement. Knoxville: University of Tennessee, Tennessee Value Added Assessment System(TVAAS).

$$$ and Achievement

A study of more than 1,000 school districts finds that every additional dollar spent on more qualified teacher nets greater improvements in student achievement than any other school resource.*

Money Does Matter

“Wealthier districts tend to spend more on education, and when all else is held constant, districts with lower spending have lower test scores.” *

Quality Teachers are Essential to Quality Learning

At the state level, full certification & a major in the field of teaching are the most significant predictors of student achievement while the lack of certified teachers is the best predictor of a lack of student achievement.*

Quality Teachers are Essential to Quality Learning,

cont. In the 50-state study,

Linda Darling-Hammond points out that teacher preparation accounts for 40-60% of the variance in student achievement after accounting for student demographics.*

Summary of School Finance Misconception #3

Decreased class size has increased school expenses; schools must hire more teachers

While teachers’ salaries have increased, controlled for inflation, they have

not increased significantly Many older teachers are now at the top of their salary

scales so their pay is higher (although it doesn’t buy more than 30 years ago)

We are now educating students with special learning needs, requiring more resources

MISCONCEPTION #4 – EDUCATOR SALARIES ARE HIGH IN COMPARISON WITH SIMILAR

PROFESSIONS (same level training & responsibility)

The Truth About Teachers’ Salaries

• Teachers in the United States work a 200-day contract – or ten months (the same months students are in school).

• Teacher work hours include more than time actually teaching in their classrooms.

• Preparing lessons• Delivering instruction• Setting up laboratory or

other learning activities• Grading students’ papers• Working after school

tutoring students• Studying their own

professional development• Participating in school

improvement activities

The Truth About Teachers’ Salaries

A study by the University of Wisconsin – Milwaukee found that U.S. teachers work an average of 10.25 hours per day. *Linda Darling Hammond: teachers work 10-12 hours a day.That is 2 1/4 hours longer than the average eight-hour workday. With the 40 contract plus the 12.5 weeks worth of “overtime” equals a work year of 52.5 weeks.

Cost Employment Index for 2001

Benefits Wages & Salaries

Education 147.7 149.5

All 160.4 152Professionals

Private/ 167.4 153.8White Collar

Source: http://www.aft.org/research/survey01/figures/figure11.9.html

Similarly Prepared Professions Offer More Than Teaching Individuals with the same

education as teachers can enter careers that: Pay more initially and

over their careers Offer periodic monetary

bonuses Provide better financial

and health benefits Receive other “perks”

that teachers do not get  

Entry Level Salary Comparisons

Engineering $ 50,033 Computer Science$ 49,749 Math/Statistician $ 49,548 Business Admin. $ 41,892 Accounting $ 40,779 Liberal Arts $ 37,143 Teaching $ 28,986

Source: http://www.aft.org/research/survey01/figures/figure III-4.html.

Changes in Salaries 1991-2002% Increase in Salaries

Engineering 30% Accounting 38% Statistician 50% Liberal Arts 28% Teaching 19%

Source: http://www.aft.org/research/survey01/figures/figure II-4.html.

Principal Salaries

• Principals’ salaries have been, on average, at least 50% more than the average teacher salaries since the 1987-88 school year.

• The variance in principals’ salaries depends on the school’s size and location (rural, suburban, or urban).

Salaries for administrators, controlled for inflation, have increased only 6.8% in the 12 years between 1987-88 and 1999-2000.

MISCONCEPTION #5 – THERE ARE TOO MANY SCHOOL ADMINISTRATORS

Too Many Administrators? There are more

administrators per student than existed fifty years ago. In comparison with other industries, however, education is a management-lean organization.

Today’s Schools Have More Leadership

& Management Responsibilities • Transportation • School safety • Observe & conference

with teachers• School improvement

planning • Meeting with parents &

community members• Coordinating the

school’s standardized testing

• Special Education:

Coordinating & addressing the referral, identification, annual & triennial review processes; discipline procedures

School Staff Employed by Area

Principals/AP’s Teachers TA’s Guidance

1949-50 43,000 914,000 ---- ----1999-2000 133,000 2,907,000 621,000

96,000% of Educators 1949-50 3.3% 70.3% ---- ----% of Educators1999-2000 2.4% 51.7% 11.1% 1.7%Pupils/Staff Ratio1949-50 582/1 27.5/1 ---- ----Pupils/Staff Ratio1999-2000 352/1 16/1 75/1 490/1

Administrative “Blob”?

Central office personnel account for only 1.6 percent of all staff in school districts. If they were all fired, the resulting savings would allow teachers a 5% salary increase & class size reduction of one student.*

Administrative Blob?, cont.

Building level school administrators supervise more than twice the number of personnel than do the typical managers in manufacturing and almost four times the number in public administration.*  

Conclusion to Chapter 1

School finance misconceptions are part of the popular culture. In fact, education finance is both the context and the driver for many contemporary cultural issues.