Cost Effective School

¶ … School Surveys by the National Association of Independent Schools last year indicated that the issue relating to money management in the schools was among the most pressing issues and challenges facing school leadership. The questions were related to re-thinking financing the schools for proving quality and cost effective education to students efficiently. Last fall, National Business Officers Association held a meeting of school heads, trustees, business managers, and advancement professionals to begin to explore the possibilities of re-engineering the ways schools approach financing.

Preliminary thinking from that symposium led to the offering that until schools can manage their own funds the quality of education is unlikely to improve. Schools in the 21st century require, among other things, thoughtful leadership in the domain of financing. Such leadership will engage schools in serious financial modeling, projecting forward five years to produce differing financial scenarios in an attempt to develop the preferred educational model for the future. Most states have a district-driven finance system.

Districts raise money and determine how it is spent on schools, and states and the federal government distribute money to districts. Schools receive resources - teachers, books, transportation - but they rarely receive money. This district emphasis needs to change to a school orientation if effective education needs are to be implemented. School effectiveness research clearly identifies the school as the key organizational unit. Therefore, decision-making authority over the school budget is a key prerequisite to effective restructuring.

Under this approach, the state would allocate most dollars in a lump sum directly to schools. An even more radical approach would be for states over time to fund schools directly.

Allan Odden and William Clune (1995) point that, "the poor resource distribution across states, districts, schools, and students, and unimaginative use of existing funds and money lead to the low performance of the school." Similarly, James Guthrie (1994) notes that, " educators' inability to obtain accurate school-level spending data is a major impediment to efficient planning, equitable distribution, and client choice." Some researchers claim that regardless of available funding, "school districts tend to utilize their resources in the same basic proportions with 60% earmarked for direct instruction and about 40% going for support services" (Picus 1995).

But others have shown that most new funding dollars over the past 30 years have gone for specialists and services, not the core instructional program (Odden 1997). Some research studies have factored the types of expenditures that matter in the school-productivity equation. A good example is Harold Weglinsky's study (1997), which found that fourth- and eighth-graders' math achievement was positively associated with lower student-teacher ratios and with expenditures on instruction and school district administration. Expenditures on facilities, recruitment of highly educated teachers, or school-level administration were not significantly related.

All of the above studies show the importance of money management for the schools in offering quality education to the students. Therefore, it is no wonder that there is growing debate about role of the states that traditionally decide the funding requirements and hiring of new teachers.