Changes to College Funding System Could Increase Efficiency, Transparency

Posted on by Abhi Sivasailam

 

In the realm of higher education funding, Missouri can do better than the system it currently has in place, which is currently characterized by little accountability for education funding, few effective measures of quality, and meager increases in access to the underserved, all while college tuition continues to rise. During the past few decades this system has sought to address problems in higher education related to access, affordability, and quality by lavishing an ever-increasing amount of funds and resources on higher education institutions within the state.

That this approach is failing to expand access or quality measures, or to reduce tuition costs, should be of little surprise. The ultimate question that those who fund higher education should address is not one of how much to fund, but how to fund.

In 2004, Colorado began an experiment in higher education funding when its legislature ratified Senate Bill 04-189 and created the College Opportunity Fund (COF), intending to end the traditional method of direct funding for universities. The new system called for students as young as 13 to sign up for the COF, with the hope that such early enrollment would force both parents and children to begin thinking about college financing options as soon as possible. When students enroll at a state college and authorize the state to disburse funds for their education costs, the state’s support is reported as a line item on their tuition bills.

University funding has never been very transparent; both the average taxpayer and the average student have little knowledge of how state money works to help students. As a result, the amount of taxpayer money that a given university receives for each student is somewhat arbitrary. Often, the per-student subsidy reflects the amount that the state can afford to spend, rather than the extent of student needs or costs.

Under the Colorado plan, the state’s contribution shows up in the tuition bill, so parents and students know the degree and change of state aid from year to year. This transparency helps students hold legislators accountable for their education spending, providing an additional incentive for the lawmakers who set education funding policy to keep student needs in mind.

Colorado also committed to direct funding for a portion of university expenses through fee-per-service contracts, and to conditional funding based on performance measures. In that system, a university is funded directly for progress toward broad state goals, such as increased graduation rates or expanded minority enrollment. This policy has helped some more than others, but unarguably has helped make college funding more effective and accountable. By introducing conditional funding, Colorado universities have begun striving to reach performance benchmarks, rather than just using tuition money to climb in national rankings through extravagant but ineffective spending.

Furthermore, by doing away with guaranteed funding, the state has created incentives for universities to keep operating costs and sticker prices low, in order to attract a larger pool of applicants. Three private universities are currently participating in the COF program, a competitive process of funding allocation that encourages all institutions to work toward greater efficiency by keeping programs that work and cutting costly ones that do not.

It is time for Missouri to take a critical look at higher education. Regardless of whether the state adopts the Colorado plan, lawmakers should look to lessons learned by other states and craft a system that encourages universities to compete and innovate in order to receive government funds. Taxpayers deserve a system that absorbs their dollars in the most efficient way. Students deserve an education that is accountable, affordable, and of the highest quality. Funding students instead of institutions would be a first step in the right direction.

Abhi Sivasailam is an intern with the Show-Me Institute and an economics student at the University of Missouri–Columbia.

 

Offering Incentives for Early High School Graduation Would Save Taxpayer Money

Posted on by Abhi Sivasailam

 

A simple policy change could help gifted students pay for college, use school resources more efficiently, shrink overcrowded classrooms, and allow teachers to focus on students who require extra attention, all while saving the state — and, thus, Missouri taxpayers — money. By offering students a portion of the state funds that would have been used to pay for their public school educations, Missouri would establish early graduation incentives for public high school students who are willing and able to complete the curriculum at an accelerated rate.

Missouri would not be wading into uncharted waters by establishing such a program; both Arizona and Texas have already implemented successful early graduation incentive programs to provide aid to their students. The Arizona program, known as the Early Graduation Scholarship Grant, disburses aid to graduates of Arizona public high schools, provided that students graduate at least one semester early and attend a postsecondary institution at least half-time. The amount of aid that a student receives in this program is contingent upon how early that student graduates, and the amount of courses that student takes upon graduating. A student who graduates a year early and enrolls full time at a postsecondary institution receives up to $1,250 during the first year of enrollment, and up to $750 during the second year. A full-time enrollee who graduates one semester early receives up to $1,000 during the first year of enrollment and up to $500 during the second year.

The Texas plan, the Early High School Graduation Scholarship, has elements similar to the Arizona plan but also encourages high school students to earn college credit. This plan stipulates that aid must be used at higher education institutions within the state of Texas. Per the plan, a student graduating high school in fewer than 36 months receives $2,000, with an additional $1,000 if that student has earned 15 hours of college credit prior to graduation. A student graduating after 36 to 41 months of high school receives $500, and an additional $1,000 for 30 college credit hours. A student graduating in no more than 41 months receives $1,000, provided that student has earned 30 college credit hours.

In Missouri, a policy that blended elements of the Arizona and Texas programs could produce a win-win-win-win situation for the state government, taxpayers, students, and schools. During 2006, the amount the state paid $3,250 per pupil to school districts. Suppose that Missouri develops a program granting $1,000 to any student graduating one year early. Also, suppose that 2,569 students participate in the program (the number that participated in the similar program in Arizona, a state containing roughly as many students as does Missouri). This would amount to an annual taxpayer savings of nearly $6 million.

Meanwhile, the student would enjoy a scholarship that pays for a substantial chunk of tuition at an in-state institution. As for school districts, although they would lose a portion of state revenue that would otherwise go to students who have graduated early, the largest slice of their revenue pie — taxes on local property values — would remain untouched. Schools and teachers would then be able to devote more time and money to students who need the most of both in order to be successful.

Often, we attempt to solve our problems in education through spending. Here, we have a tool that can both expand college access and increase per-student resources, all while saving money. That makes for sound policy, one that the state should seriously consider.

Abhi Sivasailam is an intern with the Show-Me Institute and an economics student at the University of Missouri–Columbia.

 

A Very Forthright Admission About Government Employees in Kansas City

Posted on by David Stokes

When I first saw this headline about school district employees in the Kansas City Star, I thought the article would be a classic example of a Kinsley Gaffe:

KC school district has about 1,000 employees too many, official says

But it’s even better than that, because the new Kansas City public school official quoted in the article didn’t say it by accident. He and the new school administration appear to be very serious about reducing the number of school district employees:

With about 3,300 employees, the district still has about 1,000 more people than most districts with enrollments of about 17,000 students, said Steve Harris, the new assistant superintendent for human resources.

“We’re way out of sync,” Harris said. “We want to try to get as close as we can for the next school year.”

He can’t predict how many cuts will come. A strategic planning process and school closings will determine a lot.

It is rather amazing, and gives me great hope, to see someone in a position to do something about it admit that way too many people are on the public payroll. I am sure that the cut of a few hundred people in KC will be more than offest by the addition of 100,000 new government employees in the USDOMWSEFL (U.S. Dept. of Make-Work Stimulus Employment for Life), but let’s give credit where credit it is due.

It is unfortunate that the only times we reduce local government employment are during budget-hurting recessions. I fully appreciate that this is not the best time to be laying people off. If I had any hope at all that government — at any level — would actually reduce the payroll during the good times, when those who were laid off would not have much trouble finding new work, I would oppose firings during a recession. However, with the rarest of exceptions (former Gov. Matt Blunt did reduce state employment during his recent term), this does not happen. And, because I consider padded public payrolls to be a serious threat to our freedoms, I’ll support any opportunity to reduce local and state government employment — and I say that as someone who knows what it is like to lose a good government job (for political purposes, which comes with the territory).

So, I commend the Kansas City school district for making the tough choices, just as I commended a few city of St. Louis officials when they recently reduced employment. Thanks to Combest for the catch.

It Pays for Traditional Public Schools to “Start Up” as Charters

Posted on by Sarah Brodsky

Another Oregon public school plans to become a charter. The ability to enroll students from other districts is an attraction, as it was for the last school I blogged about. But this time, the school also identifies funding as a reason to change its status.

A few years ago, no school would have expected better funding as a charter. Charters usually received less state funding per student than traditional public schools. Now, the federal government is giving out grants to start charter schools, and traditional public schools can receive these grants if they reorganize as charters.

Turning existing schools into charters isn’t the most appropriate use of startup money, which ideally should help people build schools from scratch. District schools that need to develop specialized curricula to become charters would also be worthy recipients, but this particular school in Oregon developed its specialized academic program before it sought charter status.

The startup grants encourage public schools to make nominal changes in exchange for infusions of cash; that’s a wasteful policy in the short term. However, it could bring positive results over several years. Public schools that become charters to take advantage of one-time grants will find themselves competing with the districts and with other charters. No one is assigned to a charter by residence, so charters don’t have their student bodies handed to them — they have to work for enrollment. The new charters could soon contribute to a more competitive education market, assuming they don’t find a way to switch back to regular public schools after they spend the startup money.

A Los Angeles Middle School Offers Single-Sex Education

Posted on by Sarah Brodsky

This article in the L.A. Times describes Young Oak Kim Academy’s foray into single-sex schooling. The public middle school has separate classes for boys and girls. Teachers use different methods to teach the two groups, corresponding to what they believe are the innate characteristics of the sexes:

“Boys are impulsive,” said science teacher Shambo Lerer. “Their hands go straight up. They ask questions like, ‘What happens if a planet explodes?’ “

Girls, according to Lerer, are more inclined toward creative projects and collaborative work.

I would be unhappy if students everywhere were confined by these stereotypes. In the context of a single choice school, however, the generalizations are OK. Parents of children who fit these descriptions will find the school to be perfectly suited to their kids’ personalities. Parents who don’t agree with the school’s conclusions can send their children elsewhere.

School Lunches in New Orleans

Posted on by Sarah Brodsky

The Kids Rethink New Orleans Schools website states:

Our vision is simple: a great education for every kid in our city, no matter the color of their skin, what neighborhood they stay in or how much money their parents make.

This statement, combined with the New Orleans location, led me to guess that the organization favors parental choice in education. “What neighborhood they stay in or how much money their parents make” sounds like a reference to the traditional district system, in which school assignments are based on geography and the alternatives are open to people who can pay tuition. And choice policies have shaped the New Orleans school system to a degree reformers most places can only dream of: Children who temporarily relocated from New Orleans after Hurricane Katrina received vouchers to attend public or private schools of their choice, and New Orleans has a larger percentage of students attending charter schools than any other city.

I read further and saw that my guess was wrong. The “What We’ve Done” section of the website is all about school food. Of the 12 recommendations for change, two call for more local food in school lunches. One suggests that schools establish gardens on their premises because “Students need to grow fresh food and taste what they grow.”

Kids Rethink New Orleans Schools is lobbying for something peripheral to a great education. It doesn’t matter where school food was grown, as long as students get a nutritionally complete meal. And gardening, while it’s possibly educational and rewarding, is not a basic human need. If you think of school priorities, like creating a safe environment and teaching students to read, maintaining a garden would be pretty far down the list.

I hope Kids Rethink New Orleans Schools will reevaluate its goals and stay true to its original mission. A couple of questions to consider: Are the most pressing inequities already addressed, so that we can now devote our attention to gardens? Or do neighborhoods and parental income levels continue to keep a great education out of reach for many students, for reasons that have nothing to do with food?

Alaskan Schools Should Consider Charter Status

Posted on by Sarah Brodsky

This article in the New York Times explores the plight of Alaska’s rural public school districts. These schools serve only a handful of students, and to survive, they have to try to convince families to move into homes within their boundaries. One district advertised on Craigslist.

Few parents are eager to move to remote parts of Alaska, so the districts are in for a struggle if they stick to that strategy. Here’s a better idea: These districts could convert to charter schools, like the district in rural Oregon that reopened as a charter. The Alaskan districts wouldn’t be able to physically bring in many new students to class every day — the bus ride would be too long. But they could enroll additional students online. The districts could continue to hold classes in person, while conducting parallel lessons over the Internet for students who live far away.

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