DELAWARE PUBLIC SCHOOL DISTRICT EDUCATION SPENDING 2011
Office of Lieutenant Governor Matthew Denn
This is the second annual report issued by the Lieutenant Governor's Office reporting the degree to which Delaware's public schools spend their funds on direct educational services (as opposed to administrative expenses, transportation expenses, and other operating expenses). The purpose of this report is to provide parents and taxpayers with information regarding the spending practices of the school districts in which they live. The ultimate goal of providing this information is to encourage school districts to direct more public dollars into the classroom and less into administrative overhead. This report focuses on expenditures in the 2009-2010 school year.
There were some changes in school district spending practices in the 2009-2010 school year, compared with the prior year. However, one conclusion from last year's report holds equally true in this year's report: if all of the state's school districts were spending on direct educational services at the average rate of the state's five top performing districts in this category, the state could direct an additional $26.2 million to $28.9 million annually into direct educational services without raising any taxes.
This report is not designed to conclusively determine which school districts have the best or worst spending practices. Not all direct educational expenses are necessarily good ones, and not all administrative expenses are necessarily bad ones. The report is designed, however, to alert parents and taxpayers as to which districts are spending significant sums in areas other than direct educational expenses, so those parents and taxpayers can ask appropriate questions of their school district administrators and school board members. In difficult financial times, school districts must be increasingly conscientious about their spending practices if they are to adequately compensate teachers and pay for other classroom basics.
This annual report is one of a series of actions that have been taken since early 2008 to try to encourage Delaware public school districts to spend a higher percentage of their public dollars in the classroom. Part of the motivation for this focus on classroom spending is national data suggesting that Delaware schools are spending a smaller percentage of their public funds on direct educational expenses than schools in surrounding states. Last August, the U.S. Department of Education's National Center for Educational Statistics released its annual report on revenues and expenditures for public school districts. As in past years, Delaware spent a smaller percentage of its public education funds on direct educational expenses than any surrounding state that filed statistics – in the 2010 report, a smaller percentage than Connecticut, New Jersey, Pennsylvania, or Rhode Island.
In January 2008, a committee created by then-Governor Ruth Ann Minner and co-chaired by Vision 2015 Chairman Skip Schoenhals and then-Secretary of Education Valerie Woodruff issued a comprehensive report detailing millions of dollars in potential inefficiencies in Delaware's public school spending. The committee recommended possible savings in a variety of areas including bus transportation and administrative overhead.
In 2009, the General Assembly passed and Governor Jack Markell signed House Substitute 1 for House Bill 119. This legislation required all school districts to establish citizen budget oversight committees, and also required the Department of Education to set goals for district spending on instruction and instruction-related expenses, and to compile data on school districts' performance in this area.
The Lieutenant Governor's office began issuing this report in 2010 to augment the other information compiled by the state. The data contained in this report is slightly different than the data collected and reported by the Department of Education, in that this report considers expenditures in categories such as speech pathology, audiology, guidance, health, and psychological services to be "direct educational expenses." These expenditures are included because (a) they generally involve direct interaction between school personnel and students targeted specifically at student achievement, and (b) to exclude them would make it appear (incorrectly) that districts spending heavily on students with particular special needs were not directing their funds to students.
The data reflected in this report is reported by the school districts themselves, and the categories into which the expenditures fall are categories created and defined by the United States Department of Education (www.nces.ed.gov). The information is neither generated by nor categorized by the Lieutenant Governor's office.
Calculation of Direct Educational Spending
The data summarized by this report is drawn from the most recent spending statistics posted by the Department of Education in individual school district profiles. These profiles reflect spending percentages from the last completed school year (the 2009-2010 year). House Substitute 1 for House Bill 119 was passed in 2009. Therefore, unlike the numbers reported in last year's report, these statistics reflect spending decisions made by school districts that were aware that the General Assembly would be carefully monitoring their spending practices.
The table prepared by the Lieutenant Governor's office shows five statistics for all districts, and a sixth statistic for ten of the school districts. All statistics are in percentages with the exception of the dollar amount in the last column:
1. Instruction expenses: These are expenses for activities related to the interaction between teachers and students. It includes salaries and benefits for teachers and teacher aides, textbooks, supplies, and purchased services.
2.Instruction support: This includes instructional staff training, educational media (library and audiovisual), and other instructional staff support services.
3. Student support: This includes attendance and social work, guidance, health, psychological services, speech pathology, audiology, and other student support services.
4.Total: This represents the total of instruction expenses, instruction support, and student support. This total is an effort to represent total district spending on direct educational services to students. As noted above, "student support" is added to "instructional expenses" and "instruction support" in recognition of the fact that many of the services provided under "student support" are a direct part of the educational mission for many of the district's students, and that some districts by virtue of their student population must make disproportionate expenses in this category.
5. Administration: This represents expenses for school and district administration (superintendent and supporting staff, Board of Education and supporting staff, principals and supporting staff, school district staff not included in other categories), and supplies and other purchased services relating to those staff activities.
6. Capacity: The "capacity" column represents the amount of extra funds that school districts could spend on direct student services if they spent on direct student services at the same rate as the average of the five Delaware districts with the best performance in this area. For example, the Laurel School District could spend an additional $1,335,128 on direct student services if it spent on those services in the same proportion as the average of the Caesar Rodney, Cape Henlopen, Seaford, Delmar, and Capital districts.
The chart does not reflect expenditures on food services, student transportation, and school operations/maintenance, which is why the percentage totals do not add up to 100%.
Data for the Lake Forest School District is not included in this year's report. When an initial analysis of the spending statistics for the 2009-2010 school year revealed a dramatic change in the statistics reported by the Lake Forest School District, the Lieutenant Governor's office contacted Lake Forest personnel to try to understand what might have led to a shift of such magnitude. The conclusion was that a change in coding expenditures rather than a change in actual spending practices had led to the shift. For that reason, the current statistics for Lake Forest are not considered to be a reliable indicator of its actual spending practices, and it is not included in this year's report.
What Does the Data Tell Us?
Although the statistics speak for themselves, they reveal several notable facts about spending in Delaware's public school districts.
1. With a small number of exceptions, Delaware's public school districts ranked roughly in the 2009-2010 school year where they had the previous year with respect to the comparative percentage of their public funds spent on direct educational expenses. The Delmar and Indian River School Districts improved their standing compared with the other school districts.
2. As with last year's report, the three school districts that reported the highest percentages of their funds spent on direct educational expenditures were the Caesar Rodney School District, the Cape Henlopen School District, and the Seaford School District.
3. Again duplicating last year's report, the three districts that reported the lowest percentages of their funds spent on direct educational expenditures were the Appoquinimink School District, the Christina School District, and the Laurel School District.
4. The two school districts that reported the highest percentage of funds spent on administrative costs were the Appoquinimink School District and the Laurel School District. The two school districts that reported the lowest percentage of funds spent on administrative costs were the Capital School District and the Red Clay School District.
5. Almost all districts reduced the percentage of their funds spent on administration during the 2009-2010 school year. The only districts where spending on administration increased were Smyrna, Appoquinimink, and Capital – and as noted above, Capital has the lowest percentage of funds spent on administration of any district in the state.
6. If all fifteen of the public school districts for which data was reported were to invest in direct educational expenditures at the average rate of the five districts that had the highest level of investment in this area, the state could move a total of $26.2 to 28.9 million into direct educational expenses without raising any revenues.
7. The gap between schools spending the most on direct educational expenses and those spending the least closed marginally in 2009-2010. In the 2008-2009 school year, the district spending the highest percentage of its funds on direct educational expenses had a percentage 7.88 points higher than the district spending the lowest percentage. In 2009-2010, that gap dropped to 6.14 percentage points.
8. Across the board, spending on direct educational expenses dropped in the 2009-2010 school year as compared to the 2008-2009 school year. The districts do not report statistics in a way that allows for a precise description of what caused this overall change.
To provide additional context for the reported data, the Lieutenant Governor's office also examined starting teacher salaries within the school districts to determine if there were differences among the districts with respect to compensation for teachers – one possible use of funds if they were shifted from administrative and other overhead costs to direct educational expenditures. Based upon salary information provided by the Delaware State Education Association, teacher salaries within counties vary between Delaware school districts.
Starting teachers with Bachelor's degrees in New Castle County with the Brandywine School District are paid $39,197; in Colonial School District teachers with the same credentials are paid $36,124 and in Appoquinimink School District $36,524. Similar gaps exist for new teachers with Masters degrees – starting teachers with masters degrees in Brandywine are paid $45,908; in Appoquimink, teachers with identical degrees are paid $41,173 and in Colonial $41,642. These are substantial salary differences – up to ten percent – for identically credentialed teachers who work in the same geographic area. The salary differences in Kent and Sussex County school districts are less significant, but do exist.
There does not appear to be a direct correlation between direct educational expenditures and teacher salaries – some districts that spend high percentages of their funds on direct educational expenditures are at the lower end of their county scales for teacher salaries in some categories, and vice versa. But the teacher salary data does make clear that there are outlets for districts that choose to re-prioritize their spending.
School District Comments
Prior to preparing this report, the Lieutenant Governor's office offered each school district an opportunity to note any unique aspects of its practices that might appear to inflate the amounts that it spent on items that were not categorized as direct educational expenses. A small number of districts responded and their full responses are available in their entirety. Most of the responses were general cautionary notes or criticisms regarding year-to-year categorical analyses of school district spending. The one specific response by a school district that would materially impact the data reported was Christina School District's note that it spent $2,665,000 in the reported school year as part of a repayment plan to the state for the state's assistance to the district during a district financial crisis in fiscal year 2006. Allowing for this payment would not change Christina's overall ranking with respect to the other school districts, but it would (a) narrow the gap between Christina and other districts and (b) dramatically change the amount that Christina could be presumed to save if it spent on direct educational expenses at the same rate as the five top-ranked districts.
Although this report is focused on statistics, it is ultimately about the children who rely upon our public education system to secure for them the ability to fulfill their potential and lead happy, successful lives. We have a profound obligation to these children to ensure that the money Delawareans invest in their education is spent prudently, with the quality of education as the sole motivating force behind each spending decision. We hope that taxpayers and parents in our local school districts will use this report to ensure that their money is spent wisely, and that their children receive a quality education.
 A separate report will be issued in June regarding spending practices by vocational technical schools and charter schools.
 One national report issued this year demonstrated the challenge of trying to comprehensively rank school district spending practices. In January, 2011, the Center for American Progress issued a report entitled "Return on Educational Investment: A District-by-District Evaluation of U.S. Educational Productivity." The report attempted to use mathematical formulas to control for the impact of student income on student performance, and then compare district spending to student test results. In the case of Delaware, however, the report's formula had the simple result of assigning its lowest rankings to the state's highest-poverty school districts, and with the exception of Red Clay and Milford, its highest rankings to the state's wealthiest school districts.
 "Revenues and Expenditures for Public Elementary and Secondary School Districts: School Year 2007-2008 (Fiscal Year 2008), National Center for Education Statistics, August 2010. http://nces.ed.gov/pubs2010/2010326.pdf.
 The report summary can be found at http://www.doe.k12.de.us/reports_data/files/lead/Section%201%20Executive%20Summary.pdf.
 The "Instruction," "Instruction Support," and "Student Support" categories are categories defined by the United States Department of Education's National Center for Educational Statistics.
 NCES and the Delaware Department of Education use an additional term called "instruction-related expenses" which simply combined the instruction and instructional support categories. As noted, this report also includes the category of "student support" in an effort to fully reflect expenditures that directly impact students' classroom education.
 The reason for this range is the anomaly created by Christina School District's $2.665 million repayment installment to the state for the loan it received from the state in 2006 during its financial crisis, further discussed below.
 Data provided by DSEA was salary data for the 2010-2011 school year.