Seth Rosenblatt – San Carlos School Board

Starting this month, I will be a guest columnist on the new EdSource Today website. This site is edited by John Fensterwald, who was known for his popular TOP-Ed blog on the Silicon Valley Education Foundation site.

My first post from yesterday, The Myth That Only Furloughs Can Balance School Budgets, is a topic that I have written and spoken about numerous times, and probably was chosen first because it would be sure to generate a little controversy. Already the comments are starting to come in.

I suspect I’ll have a few posts per month, and there will be lots of other great information and resources on the site!

This week the Silicon Valley Community Foundation published a booklet entitled “How Did We End Up with 54 School Districts in San Mateo and Santa Clara Counties?” The piece outlines the history behind how school districts were set up and does an adequate job at explaining the historical context as well as efforts to consolidate districts (most of which were unsuccessful). However, this is not the first time that SVCF has written about school districts, and the President of SVCF, Emmett Carson, seems to have a strange obsession with local school boards. He has continually campaigned that there are too many school districts and school boards and that this has been a significant obstacle to school reform. This publication is written as a history guide but uses it as an argument to present what they believe is a significant problem. Strangely, the piece doesn’t actually talk about WHY having so many school boards is a problem. It just states it as an assumption, and decries the people who have resisted school district consolidation efforts.

Although I agree with many of the problems outlined regarding our public schooling system, SVCF has a fundamental misunderstanding of how the system works. I have met with folks from SVCF a number of times, and their lack of understanding about the education funding system in particular was somewhat shocking given that they are advancing ideas on how to “fix” the system. The piece also gives short shrift to those who have argued against consolidation, just implying they are resistant to change with no particular substance to their stance. Most interestingly, the publication references a 2010 Legislative Analyst Office study which said that the state should leave reorganization decisions to local districts since there was no persuasive evidence that consolidation would lead to substantial savings or higher student achievement. But then SVCF then just ignores that point and continues making its argument for consolidation.

To be clear, there are some good arguments for reorganization and consolidation (and many school board members even favor these ideas), but the report doesn’t actually outline the arguments well, and it certainly doesn’t give any airtime to the substantial arguments against consolidation. To my knowledge, no school board members were actually spoken to in the creation of this report. It’s clear it’s a one-sided effort to advance this strange obsession. SVCF ignores some real issues, such as:

• Few economies of scale: Schools are not technology firms — they are service firms. The largest cost in a school district is teachers, and the total cost for teachers is roughly a linear relationship to the number of students. Growing a school district does not change the number of teachers you need relative to the number of students. And there are very little economies in “administrative” costs. Among all states, California has the lowest number of administrators per student, and increasing the size of the school district does not necessarily reduce costs as larger sized school districts will generally just need more mid-level administrators to cover all of the work. (For example, it’s not as if you have less disciplinary issues per student with a larger student body — so once again, the work load is fairly linear). In fact, there are a number of areas of diseconomies of scale, related to coordinating among a much bigger district as well as some of the following points below.
• Local revenue: Because of the terrible state of public school finance, many districts are forced to rely on local sources of revenue for their districts, including parcel taxes and local education foundations. Here it is extremely clear that relatively small districts (meaning many of the size of those in San Mateo County) are much more successful on both counts in raising money this way. The relative intimacy of the community makes it far easier to both raise money privately or get support for a local tax measure. LA Unified can’t pass a parcel tax (and just scrapped its plan to put one on the ballot for this November), whereas little San Carlos has passed two. Even if there were any economies of scale in consolidating school districts, those costs savings would be dwarfed by the loss of local revenue no longer achievable.
• Accountability: Mr. Carson has repeated many times — both in newspaper articles as well as this report, that having so many school board members decreases accountability. This is one of the more perplexing points which is just stated as fact without any reason behind it. Admittedly I’m biased as a local school board member, but if anything, this is what the current system does extremely well. I run into my constituents every day. People recognize me when I walk down the street. I answer every e-mail and phone call I get personally. If someone asks to meet with me, I have coffee with them. Try doing that with your U.S. Congressman, State Senator, or even County Supervisor. Their territory is just too big to be that familiar with all of the citizens. It is this closeness which creates that accountability — I cannot hide anywhere. How does increasing the scope of someone’s responsibility increase accountability? I would posit that it does exactly the opposite.
• Public Participation: The flip side of the accountability coin is the ability for the public to participate in the process. In our little town, everyone is within a five minute drive of every public board meeting, and there are so many avenues to communicate with their local elected representatives. Increasing its size only decreases the ability for the public to participate in the process and be connected to their government.
• Intimacy/Knowledge: Just as the closeness with the community creates accountability, it also creates a sense of intimacy and a more specific knowledge about the district over which one governs. Especially in a school district, where the support and energy of the community is so vital, I would argue this allows the board member to make better decisions. Every school board member comes to appreciate that many of their issues are truly local and dependent upon the culture of that community, and even these subtle differences can drive more optional decisions.
• Truer form of democracy: If anything, our system of locally elected school board members is the best example of our democratic system as it was intended. Of course it’s not perfect, and naturally there are stronger and weaker representatives, but contrast this to other political structures. School board members don’t declare their political party; most have little political ambition beyond being on a school board; money is a very small factor, and there is very little influence from “special interests.” Particularly given the current political climate and the dysfunction created by our current state and national political structure, do we really want to create more, larger political bodies which risk the same type of dysfunctional influence? Maybe school boards should be looked at the model for other political bodies, not the other way around.

Note that the SVCF report references a study co-sponsored by the San Mateo County Schools Boards Association (of which I am President) which examined potential sharing of services among school districts and other local agencies. Although the study did find some areas where there were potential cost savings, they were all relatively minor and actually less than the study’s sponsors (including us) imagined when we commissioned it. The SVCF report paints the reaction of local school districts as ignoring these recommendations whereas, in fact, there are real and valid concerns that the effort required to adopt some of these proposals would just not bring in enough savings (again, to the earlier point that the big costs are in the teachers). That said, I do believe there should be — and will be — focused efforts on the part of school district to share some “back office” functions, and I believe there is an expanded role for the County Office of Education to take on additional functions on behalf of school districts as well.

SVCF also ignores a giant structural problem that would prevent consolidation of districts even assuming that was a valid goal, and this is the very nature of our state funding system. For example, no Basic Aid District in their right mind would merge with a Revenue Limit District (for explanation on what these terms mean, see my video on California Education Finance). So, until the overall state system for funding schools is fixed, these discussions are largely an exercise in futility.

Lastly, why does SVCF limit its obsession to local school boards? Wouldn’t their same points apply to city governments? No one seems to have any problem with those. I would argue that cities exist for many of the same reasons outlined above, even if there would be some potential cost savings by combining cities or abolishing them altogether and letting counties or states run the same functions. Cities are definitely looking to share services (police, fire, etc) which, unlike those from schools, have a more hierarchical management structure (making them more of a candidate for economies of scale), but even then could you imagine the outcry if someone proposed that we get rid of cities?

I do agree that the current system of school district organization may contribute to one of the major flaws in our overall system, which is fairness and equity across students and families of different means and backgrounds. But this is largely the result of three factors: (a) the inherent inequity in how the state funds schools, (b) larger social issues, including poverty, which affect the level of involvement and resources of parents with regard to their children’s education, and (c) the ability for some districts to raise local money while others can’t. Consolidating school districts may affect (c), and ironically just may make the local revenue lower for everyone, but it would not affect (a) and (b). Therefore, the issue of fairness and giving an equal opportunity for all children to succeed is a larger problem that needs to be addressed through the state system. There’s no evidence that larger districts actually create greater equity (once again, ask LA Unified or SF Unified), so let’s focus on the state structural issues around education finance first.

I will also concede that some school district boundaries could be tweaked to create some advantages, for example, to align school district boundaries with city boundaries to reinforce that intimacy and community that makes school boards so relatively effective.

But I would wish that SVCF would do a more thorough analysis of the facts instead of just writing pieces that fit their existing preconceptions. I also hope that they would appreciate that local school board members, who volunteer a tremendous amount of their time for little or no pay — not for political ambition, but to serve children and invest in our future — should be looked at as part of the solution rather than the problem.

Having spent two decades working in the private sector before running for our local school board, I was unaccustomed to a school district’s degree of openness. Like most public agencies, ours is essentially an open book — all of our board meetings are held in public (with limited exceptions), all of our contracts are public, vendor bidding is public, all decisions are made public, and all employees’ salaries are public. That makes a lot of sense, doesn’t it? We use tax dollars as our main source of income. We are stewards and trustees of these taxpayer dollars. And we must hold ourselves accountable to the taxpayers for the prudent use of that money. We must be transparent. There are few exceptions allowing for secrecy, including areas such as student discipline, employee discipline, and discussions of lawsuits.

For me, transparency took some getting used to, as business interactions are by and large secret. Secrecy allows the businesses to shield the “sausage making” process from its stakeholders, make decisions much more quickly, and pick and choose which information to make public or even disclose to its own employees. Through my straddling of both the private sector and public sector worlds, I have noticed that most people don’t think through the implications of these fundamental differences on how an organization can be managed. Although these contrasts should not be used as an excuse to defend poorly performing public institutions or public representatives, simply saying “just do it the way business does it” ignores reality. There is a fundamental difference between learning from private organizations and copying them.

Take, for instance, how we compensate employees. As most people know, most public schools pay teachers on longevity, and potentially advanced degrees and training. This is what is usually referred to as the “step and column” schedule. This compensation structure ignores what most would think of as the more interesting and relevant criteria, such as employee skills, competency, the amount of work and responsibility, and the supply and demand realities of their specific role. Although this is not the only area of criticism of our public schools by parents and other community members, compensation philosophy ranks as one of the highest.

When most people in the education establishment are asked why it so difficult to compensate public employees in a differentiated way more akin to private companies, you often hear a number of answers. Some point to union resistance while others note the difficulty of coming up with meaningful and objective measures of performance not subject to political pressures. While there may be some truth to these arguments, I believe they can be overcome. Those are not the fundamental problems.

So, what is then? I will posit that the problem is indeed our openness. For any of you who work in a private sector company, let me give you a scenario. You wake up for work tomorrow morning, open the newspaper (or view your company website), and every single employee in your company is listed along with their compensation. Any manager or HR director would tell you that it would almost overnight render the company dysfunctional. Sure, there are exceptions to every rule, and certainly there are companies out there (probably small ones) where everyone knows everyone else’s salary. And even sometimes this information leaks out. And yes, the top earners in publicly traded companies are disclosed. But this is all a small minority. The ability for any leader to manage his/her team is premised on the concept that he/she can differentially pay each employee without any other employee knowing what others make. Imagine the company “politics” that would ensue if this were not the case. I’ve mentioned this hypothetical scenario to a number of managers and company owners — there wasn’t much that has scared them more. I will concede that often workers in the private sector have a good sense of what their co-workers make, but that is a major difference from *knowing* what they make. “Wait, I’m better than Johnny, how come he makes more than I do?” The psychology is just too strong for we flawed humans.

Now let us return to our public schools. Our staff has always had this scenario. Everyone knows what everyone else earns. But, unfortunately it’s worse than that. The intimate relationship between schools and their “customers” (students, parents) adds another twist into this story. Parents often have a sense of who are the best (and maybe worst) teachers, but they don’t really know. Schools already often have to deal with the difficulty of aggressive parents requesting their child be in a certain class or parents second-guessing their child’s teachers. Imagine if we broadcasted the information on which teachers are best? If we pay on merit (which I would argue is a good thing to do), we can now easily tell that Ms. Smith is clearly the much better teacher than Mr. Jones, as Ms. Smith makes $80K/year while Mr. Jones only makes $50K/year. Can you picture the stampede of parents into the principal’s office when little Billy or Sally gets assigned to Mr. Jones’s class? This would pit parent against parent, employee against employee, and make it even harder to run an effective school.

So, one can say that our current system of paying someone on their longevity—a metric that is both objective and meaningless—is one of the few alternatives that allows us to keep a functional organization while having complete transparency. It’s hard to argue with the metric of how many times the Earth goes around the Sun. Although it is true that some younger teachers resent some of the older ones who they may think are not performing as well as they are, at least they’ve accepted the fact that their lower salary doesn’t reflect on their ability or contribution per se (hence why it’s “meaningless” as it relates to one’s ability). In an environment where we know how much each other makes, any measure which suggests something about my ability versus yours carries that psychological baggage.

But as I said, I don’t like the current way we pay employees. So how do we balance the need for transparency with the need to effectively manage our organizations? There are perhaps a few middle ground alternatives that, although not perfect on either measure, could work well alone or in combination:

• More emphasis on stipends for extra responsibilities — many districts, like ours, pay teachers (and other employees) stipends for taking on extra work. It’s hard to get too mad at your colleague who gets paid more if he/she did more to earn that money, assuming the opportunity may be open to you as well.
• Create multiple career paths for employees — some districts have begun to experiment with more paths for “master teachers,” “mentors,” or other classes of employees. With these paths could come requirements and additional responsibilities, and with that more pay.
• Reviews decoupled from pay — a separate (but related) problem facing many school districts is the lack of meaningful employee evaluations. Some of this is due to resources and perhaps some of it to union resistance, but I would postulate that reform in this area is hampered by the fear of linking reviews to compensation (knowing the latter will be made public). Although I would prefer them to be linked, even if we had to pay all employees on “objective and meaningless” metrics, it would still make a huge difference to implement a strong and meaningful review system that acknowledged great performers, gave regular feedback to all, provided support to improve performance, and ultimately removed poor performing employees from the organization.
• Sacrifice a little openness — this may be sacrilege for some, but my thesis is that making public everyone’s salary shackles our ability to “act like a business” while at the same time does little to promote transparency. We want to be strong stewards of taxpayer dollars and accountable to the public, but does the public really need that level of detail? What if school districts published a range of salaries based on class or career path, or even published the total compensation by school, grade, subject, or some other category? The taxpayer would still know how much money was going to a certain service or program, but not in a way that would disrupt the ability for a school district to implement a meaningful differential pay system. We could preserve disclosure of the salaries of top administrators in a school district (just a public companies disclose compensation of top officers), as they largely have no peers within the organization against which to compare themselves.

We must recognize that no system—even in the private sector—is perfect. People will be people, and even in well-designed review and compensation systems, there are a myriad of problems. Some teachers today get upset at others who receive stipends for extra work. There may always be accusations of unfairness. People may still have a good sense of who are the top and lagging performers and have ill feelings toward each other. For the dozen or so private sector companies I have worked in my career, I have never witnessed one devoid of these organizational issues. But there is no comparison between these normal issues of organizational dynamics and the wet blanket of full compensation disclosure that we have thrown on top of public enterprises.

Teacher pay (and how schools manage their employees in general) has perennially been a controversial issue. Much of the criticism of schools’ historical approach to this problem is well deserved. But we must peel back the onion and understand all of the implications of “reform” measures. And it’s not just about the fact that change is hard and that there is inertia in the current system. Yes, those are true, but we can make changes. However, we must recognize that as society we have placed a unique burden on public institutions in the name of transparency. It is perfectly reasonable to argue that this is just the price we pay, and that having items like salaries disclosed publicly is of a higher value to the taxpayer than giving the organization greater flexibility in compensation. Some even argue that disclosure requirements should be made stricter—we need to prevent another Bell, California after all, don’t we? However, it would be intellectually dishonest to suggest that schools can both imitate the flexibility that businesses have while retaining the burden we require of our public institutions. Let us have the discussion as to what tradeoffs we’re willing to make.