The CEO of Epic One Virtual Charter Schools recently sent an e-mail to his teachers claiming school superintendents lied to the Senate Education Committee (concerning how virtual charter schools spend your tax dollars) :
Dear Faculty,
Recently, the state Senate Education Committee held an interim study on EPIC and virtual charter schools. EPIC was not allowed to present or provide response to that study. In fact, the executive director of the Oklahoma Virtual Charter Schools Board was given the wrong time and location for the study, so was prevented herself from presenting... Presentations were made by various brick and mortar superintendents selected by the Cooperative Council of School Administrators (CCOSA), as well as a presentation by a CCOSA representative himself, all who made blatantly false and insulting allegations about our faculty and school... (For context and for the purposes of you knowing the facts, EPIC's per pupil funding is nearly dead last among all public school systems in Oklahoma and about a third of what Oklahoma City and Tulsa Public Schools receive.)
The only sentence in this e-mail which is factual and not misleading is "Recently...". All other statements to his faculty are half-truths, propaganda, or outright false. For instance, EPIC may provide a response to the facts presented at any time, and send it to the members of the Senate Education Committee. The CEO is unlikely to respond to this invitation, however, because facts are difficult to refute.
Secondly, the executive director of the Oklahoma Virtual Charter Schools Board was invited to speak, but did not show up on time. She was provided the time and place of the study, but it is unknown why she was late. The chair of the Senate Education Committee, who controls the order of speakers, could have recognized her and allowed her to speak, but the OVCSB executive director stayed in the back of the room, and chose not to be identified.
Some of the "blatantly false and insulting allegations" are provided in the table below. For the 2016-2017 school year - the Total Students (TS), Total Expenditures (TE), General Administration and Central Services (GA), and percent of administration costs to total costs are provided for selected traditional public schools and virtual charter schools...
School # Students Total Expend. Admin. Expend. %
Mustang 11,031 $67,530,069 $3,857,143 5.7%
Owasso 9,737 $60,259,476 $2,544,322 4.2%
Yukon 8,479 $53,783,578 $2,568,266 4.8%
Enid 8,028 $56,248,103 $2,370,051 4.2%
Blanchard 2,016 $13,661,915 $530,687 3.9%
Lindsay 1,245 $8,433,625 $411,761 4.9%
EPIC 9,077 $38,701,823 $2,610,868 6.7%
Connections 1,118 $6,498,538 $1,120,867 17.2%
The EPIC CEO is correct in saying that EPIC's per pupil funding is lower than almost all traditional public schools (Epic's per pupil funding is $4,264, while Mustang's is $6,122). However, this is not the complete story and a "half-lie" when administrative costs for EPIC (6.7%) is compared to Mustang's administrative costs (5.7%). As a matter of fact, when a mid-sized traditional public school, Blanchard administrative costs (3.9%)... is compared to a mid-sized corporate virtual school, Connections administrative costs (17.2%) - the difference is even more pronounced.
A more detailed examination of the expenditure data for traditional public schools as compared to corporate virtual charter schools may help to answer the question: "How and why do virtual charters spend more tax dollars for administration than traditional public schools?" One answer may be in the OCAS expenditure Function 2500 and Object 300 series. A comparison for these expenditure codes is provided in the table below:
School Function 2500 Object 300 Expenditures % of Total Exp.
Yukon $34,371 .06%
Blanchard $0 0%
EPIC $876,011 2.3%
Connections $672,314 10.3%
The facts of the matter - EPIC spent 38 times more for administrative functions than Yukon schools did, and Connections spent more than 171 times more than Yukon. The questions now become: "To what entities did this money flow?" and "What results were produced as $millions were directed to the top of the corporate pyramid?" Partial performance results can be ascertained from the student graduation rates of traditional public schools and virtual charter public schools in the table below.
School Cohort Graduation Rate (%)
Yukon 92%
Mustang 94%
Blanchard 82%
Lindsay 79%
EPIC 36%
Connections 44%
Insight 30%
OK Virtual 43%
If a school's graduation rate is any indicator of "quality product", then the state is wasting tax dollars on "for-profit" virtual charter schools. Three of the total four virtual charter schools identified in the table are "for-profit" - EPIC, Connections, and Insight. Many people believe that funneling tax dollars to the administrative costs of virtual charters is a waste.
At least some of the waste has gone to state elected officials...
Monday, October 29, 2018
Friday, October 26, 2018
School administrative expenditure comparisons
Many Oklahoma citizens and several state lawmakers have suggested "school consolidation" or "administrative consolidation" as the remedy for Oklahoma's school funding problems. We've already provided research and analyzed data which indicates "no additional money is provided to the classroom when traditional public schools are consolidated, or when administrative costs are consolidated". The tables below further illustrates that traditional public school consolidation is nothing more than a canard for saving money. For comparative purposes, we have provided data for 23 mid-size traditional public schools (schools with 1500 to 2100 students) - listing the School, Total Expenditures, Average Daily Membership (ADM), Average Daily Attendance (ADA), Total Administrative Expenditures (including site administration), Total Administrative dollars spent per student, and Total Administrative Costs (not including site administration). The data was obtained from the Oklahoma State Department of Education website and the Oklahoma Cost Accounting System (OCAS) records from the 2013-2014 school year (the latest available). The information is provided in two tables for easy comparisons and calculations.
School Total Admin. Expend. ADM Total Spent/Student
1) $2,082,924.29 1,948.51 $1,068.98
2) $1,091,428.08 1,814.82 $601.53
3) $1,327,688.65 1,741.37 $762.44
4) $1,282,019.37 1,731.09 $740.59
5) $1,603,600.83 1,809.14 $886.39
6) $1,352,548.12 1,783.32 $558.44
7) $1,312,716.35 1,570.73 $835.74
8) $1,474,335.89 1,703.25 $865.60
9) $1,881,369.93 1,797.38 $1,046.73
10) $1,243,054.34 1,850.55 $671.72
11) $1,474,028.49 1,802.41 $817.81
12) $1,453,284.57 1,732.25 $838.96
13) $1,181,597.32 1,515.19 $779.83
14) $1,701,940.90 1,780.09 $956.10
15) $1,212,960.48 1,820.86 $666.15
16) $1,118,690.62 1,560.26 $716.99
17) $1,276,427.80 1,832.69 $696.48
18) $1,728,523.35 1,552.18 $1,113.61
19) $1,867,725.47 1,830.70 $1,020.22
20) $1,447,155.65 2,027.96 $713.60
21) $1,817,891.14 1,833.56 $991.45
22) $1,463,538.46 1,642.02 $891.30
23) $1,577,274.73 2,070.12 $761.92
Average $762.41
(The Total Administrative Expenditures for each school represents all administrative costs, including central office expenditures and principal office expenditures.)
School Total Admin. Expend. ADM Total Spent/Student
1) $2,082,924.29 1,948.51 $1,068.98
2) $1,091,428.08 1,814.82 $601.53
3) $1,327,688.65 1,741.37 $762.44
4) $1,282,019.37 1,731.09 $740.59
5) $1,603,600.83 1,809.14 $886.39
6) $1,352,548.12 1,783.32 $558.44
7) $1,312,716.35 1,570.73 $835.74
8) $1,474,335.89 1,703.25 $865.60
9) $1,881,369.93 1,797.38 $1,046.73
10) $1,243,054.34 1,850.55 $671.72
11) $1,474,028.49 1,802.41 $817.81
12) $1,453,284.57 1,732.25 $838.96
13) $1,181,597.32 1,515.19 $779.83
14) $1,701,940.90 1,780.09 $956.10
15) $1,212,960.48 1,820.86 $666.15
16) $1,118,690.62 1,560.26 $716.99
17) $1,276,427.80 1,832.69 $696.48
18) $1,728,523.35 1,552.18 $1,113.61
19) $1,867,725.47 1,830.70 $1,020.22
20) $1,447,155.65 2,027.96 $713.60
21) $1,817,891.14 1,833.56 $991.45
22) $1,463,538.46 1,642.02 $891.30
23) $1,577,274.73 2,070.12 $761.92
Average $762.41
(The Total Administrative Expenditures for each school represents all administrative costs, including central office expenditures and principal office expenditures.)
Thursday, October 25, 2018
Thank You - Citizens of Blanchard
In 2008, Blanchard voters approved a bond issue for building a new high school for students and the community. The school has been making payments for this new school since then, at about $2 million per year. The bond is set to be retired in June of 2020, so I thought it would be a good time to review school bond structures - the way money is acquired and spent.
Many people, when buying a $100,000 home, can't pay cash - so must mortgage the home and make monthly or annual payments for 10, 15, 20, or 30 years. When voters approved purchasing the new high school, they also approved making payments for its acquisition. It was a 12-year mortgage, so citizens will be making the last annual payment in 2020. The "payments" to the lien holder have averaged about $2 million per year. The county or school treasurer must adjust the millage rates each year, so that enough money is collected in the bond or sinking fund to make the appropriate payment. The county assessor, by law, cannot adjust the assessed value of any property, so that the appropriate payment can be made. The assessor also cannot adjust any market value upward, more than 3% each year, even if a property market value increases more than 3%. The property tax that any home owner pays is derived by multiplying an assessment figure (typically 11% of any homes market value) by the millage rate. A simple example would be: A home's market value is $100,000, so the assessment for property tax purposes is set at 11%, or $11,000. This $11,000 is multiplied by the millage rate, lets say 100 mils, so the math to calculating your property tax bill is $11,000 x .100 (one mil is one-one thousandth of a dollar) = $1,100. Only the bond or sinking fund millage rate may be adjusted each year for acquiring the appropriate bond payments. In other words, the bond millage may increase or decrease, based on the total market value of all property. In 2017, the actual millage rate for Blanchard Public Schools was $131.80. For a $100,000 market value home, the property tax payed was .13180 x $11,000 = $1449.80. The millage rate was adjusted so that the school could make the appropriate $2 million payment. Anything less would mean default by the school, and a judge would order the appropriate increase.
The good news is this: In 2018, when citizens pay property taxes, they will discover that the millage rate will have decreased to $120.75. When the $11,000 is multiplied by .12075, the $100,000 home tax will slip to $1,328.25, a decrease of 8.38%. The reason for this decrease is that property value in the Blanchard District increased by 8.38%. Property value increases resulted in millage rate decreases.
Many people, when buying a $100,000 home, can't pay cash - so must mortgage the home and make monthly or annual payments for 10, 15, 20, or 30 years. When voters approved purchasing the new high school, they also approved making payments for its acquisition. It was a 12-year mortgage, so citizens will be making the last annual payment in 2020. The "payments" to the lien holder have averaged about $2 million per year. The county or school treasurer must adjust the millage rates each year, so that enough money is collected in the bond or sinking fund to make the appropriate payment. The county assessor, by law, cannot adjust the assessed value of any property, so that the appropriate payment can be made. The assessor also cannot adjust any market value upward, more than 3% each year, even if a property market value increases more than 3%. The property tax that any home owner pays is derived by multiplying an assessment figure (typically 11% of any homes market value) by the millage rate. A simple example would be: A home's market value is $100,000, so the assessment for property tax purposes is set at 11%, or $11,000. This $11,000 is multiplied by the millage rate, lets say 100 mils, so the math to calculating your property tax bill is $11,000 x .100 (one mil is one-one thousandth of a dollar) = $1,100. Only the bond or sinking fund millage rate may be adjusted each year for acquiring the appropriate bond payments. In other words, the bond millage may increase or decrease, based on the total market value of all property. In 2017, the actual millage rate for Blanchard Public Schools was $131.80. For a $100,000 market value home, the property tax payed was .13180 x $11,000 = $1449.80. The millage rate was adjusted so that the school could make the appropriate $2 million payment. Anything less would mean default by the school, and a judge would order the appropriate increase.
The good news is this: In 2018, when citizens pay property taxes, they will discover that the millage rate will have decreased to $120.75. When the $11,000 is multiplied by .12075, the $100,000 home tax will slip to $1,328.25, a decrease of 8.38%. The reason for this decrease is that property value in the Blanchard District increased by 8.38%. Property value increases resulted in millage rate decreases.
Wednesday, October 24, 2018
Why conservatives should vote "no" on SQ 801
State Question 801, if approved by voters, will give schools the right to use "Building Funds" for operational expenses such as teacher salaries. Schools currently receive 5 mils of assessed local property value for the purpose of building acquisition, maintenance, and upkeep. Schools cannot use building funds for anything else, such as teacher salaries and student instructional needs. Also, schools' General Fund monies are equalized through the state funding formula, so all schools operate with roughly the same amounts. Teacher salaries and student needs are paid from a school's General Fund, which is based on the school's number of students.
An equalization problem will result if SQ 801 passes, because 5 mils (one one-thousandth of assessed district value) is not equal for all schools. School "A" may receive $1 million for its Building Fund, which $500,000 could be used for teacher salaries and student needs - but school "B" may receive only $500,000 of which none could be spent for teacher salaries. Inequity is automatically created for schools operational monies, if SQ 801 passes.
Inequity among schools is created by the state legislature, since lawmakers placed the state question on the November ballot. The underlying intent of the authoring lawmakers is to take the burden off the state for providing operational funding, and place it square on the shoulders of local property owners. As a result of SQ 801 passing, many "property poor" schools will sue the state for "equal treatment". Remember, operational monies are currently equalized, but inequity will be created, if SQ 801 passes. Those "property poor" schools will likely win the lawsuits which will follow 801 passage, because all public school students deserve equal treatment. A judge is likely to order the state legislature to equalize those Building Fund monies which public schools receive. The legislature is unlikely to take operational monies from wealthy schools to provide equity, but very likely to allow poor schools to increase their millage rates (from the current 5 mils to 10 or 15 mils). Since property tax is calculated by multiplying the millage rate by the net assessed property value, property tax in poor districts will likely skyrocket. For example, 5 mils of a $100,000 market value home, of which $11,000 is assessed, will result in ".005 x $11,000 = $55 going to a school's Building Fund. Increasing the millage rate to 10 mils will result in ".010 x $11,000 = $110, or a $55 increase for your property tax.
Many conservatives believe State Question 801 is a backdoor attempt by lawmakers to increase your property tax. The bottom line is this: If you want your property tax to increase - vote "yes" on SQ 801...
An equalization problem will result if SQ 801 passes, because 5 mils (one one-thousandth of assessed district value) is not equal for all schools. School "A" may receive $1 million for its Building Fund, which $500,000 could be used for teacher salaries and student needs - but school "B" may receive only $500,000 of which none could be spent for teacher salaries. Inequity is automatically created for schools operational monies, if SQ 801 passes.
Inequity among schools is created by the state legislature, since lawmakers placed the state question on the November ballot. The underlying intent of the authoring lawmakers is to take the burden off the state for providing operational funding, and place it square on the shoulders of local property owners. As a result of SQ 801 passing, many "property poor" schools will sue the state for "equal treatment". Remember, operational monies are currently equalized, but inequity will be created, if SQ 801 passes. Those "property poor" schools will likely win the lawsuits which will follow 801 passage, because all public school students deserve equal treatment. A judge is likely to order the state legislature to equalize those Building Fund monies which public schools receive. The legislature is unlikely to take operational monies from wealthy schools to provide equity, but very likely to allow poor schools to increase their millage rates (from the current 5 mils to 10 or 15 mils). Since property tax is calculated by multiplying the millage rate by the net assessed property value, property tax in poor districts will likely skyrocket. For example, 5 mils of a $100,000 market value home, of which $11,000 is assessed, will result in ".005 x $11,000 = $55 going to a school's Building Fund. Increasing the millage rate to 10 mils will result in ".010 x $11,000 = $110, or a $55 increase for your property tax.
Many conservatives believe State Question 801 is a backdoor attempt by lawmakers to increase your property tax. The bottom line is this: If you want your property tax to increase - vote "yes" on SQ 801...
Tuesday, October 23, 2018
Vote Liz George for House District 42
Vote Liz George for House District 42!
I will vote for Liz George on November 6, 2018, for House District 42 state representative because she supports our public schools, as Liz is a member of the Blanchard Board of Education. Liz will support all state and county services, as she will help provide appropriate funding to health care services and county roads and bridges - without raising taxes.
In addition, Liz is supported and endorsed by the State Chamber of Commerce, as it states "We know that you will be a pro-business legislator focused on making Oklahoma a better place to live and do business. The conservative State Chamber also proclaims in its endorsement that "Liz George understands the complex issues facing our state. She has the experience to be a leader for meaningful reforms and common-sense solutions. Liz George knows that providing a quality education to our children is essential for economic development and moving our state forward. I encourage you to support Liz George so that she can fight for the reforms that will make Oklahoma a better place to live, work, and raise a family." The Chamber goes on to say "It is important to Oklahoma's business community to support candidates like you, and we are confident that the voters of your district will also see the importance of supporting you."
I know that I will be voting for Liz George for House District 42!
Sincerely,
Jimmy Beckham
(This ad supported and authorized by the friends of Liz George)
I will vote for Liz George on November 6, 2018, for House District 42 state representative because she supports our public schools, as Liz is a member of the Blanchard Board of Education. Liz will support all state and county services, as she will help provide appropriate funding to health care services and county roads and bridges - without raising taxes.
In addition, Liz is supported and endorsed by the State Chamber of Commerce, as it states "We know that you will be a pro-business legislator focused on making Oklahoma a better place to live and do business. The conservative State Chamber also proclaims in its endorsement that "Liz George understands the complex issues facing our state. She has the experience to be a leader for meaningful reforms and common-sense solutions. Liz George knows that providing a quality education to our children is essential for economic development and moving our state forward. I encourage you to support Liz George so that she can fight for the reforms that will make Oklahoma a better place to live, work, and raise a family." The Chamber goes on to say "It is important to Oklahoma's business community to support candidates like you, and we are confident that the voters of your district will also see the importance of supporting you."
I know that I will be voting for Liz George for House District 42!
Sincerely,
Jimmy Beckham
(This ad supported and authorized by the friends of Liz George)
Monday, October 22, 2018
Charles K. Heatly
I attended the funeral of an old friend and mentor on Sunday at the Lindsay High School gymnasium, aptly named "Charles K. Heatly Arena". It was the largest devotion and remembrance of any I've ever attended, as Coach Heatly is legendary. He organized his funeral much the same way he organized his girls basketball teams (which won over 500 games, 2 state titles, 3 state runner-ups, and 17 state tournament appearances). Doyle Greteman, former Blanchard High School principal and former Lindsay school superintendent, spoke and introduced the speakers during the memorial. One tribute was given by Jill Street, former All-State player, who represented the 100+ Leopardette players in attendance. Another tribute was provided by Tommy Noles, a former All-State basketball player and All-State football player, who represented the 100+ high school men athletes in attendance that played for Coach Heatly. Also in attendance was Sherri Coale, University of Oklahoma womens basketball coach and John Cox, state superintendent candidate. Reba McEntire, who attended Charlie's basketball camps as a high school player, sent flowers to the remembrance. All speakers had numerous memories of Coach Heatly, including his son, Danny, who related the following: The Lindsay Leopardettes were playing Byng in the semi-finals of the state tournament in 1968. His point forward - Gaylyn Armstrong, put up a jump shot "in the lane", which went under the basket but swished the net on the way to the floor. Gaylyn was fouled while shooting, and Heatly made the slam-dunk motion and screamed "Yes!". The game official approached the score table and made the same gesture "shot good" plus one free throw. Gaylyn completed the unlikely 3-point play, eventually winning the game, and then winning the state championship the following day. (A side-note is that the game official went on to officiate during the NCAA Championships and in the NFL as a football official.) Of course, as most Oklahoma sports fans know, Charlie Heatly is a true "Girls Basketball" legend and a pioneer for high school girls basketball, both in Oklahoma and nationwide, but my recollections are from Jr. High football...
Coach Heatly was my first organized school coach in Lindsay Jr. High, 1970, as my 8th grade football coach. For competitive sports, we only had "little league" prior to 1970, and the coaches weren't mean (We didn't have to run much and didn't get chewed out, which was just the opposite in Jr. High football. I was a player for the Leopard Cubs (as we were called), as was Danny Heatly, Coach Heatly's son, and my future brother-in-law - as my sister Dana would soon marry him. At the end of each football practice - Coach Heatly had wind-sprints in store for us. We would run 6 or 8 50's at which time Heatly began allowing the winner of each sprint to "go in". I was fairly fast, by Leopard standards, so would usually win the first sprints before beginning the elimination sprints. Danny was also fast, but usually finished in the middle of the pack, before it counted. As the first elimination sprint was run, I noticed that I had not finished first, but Danny had won. He had smartly saved his best for when it counted, and would get to "go in". Not so fast, though, as to prevent Charlie from noticing. I can still hear Coach Heatly say "Jimmy, you can go in, Danny you can stay out here." Danny won the next several heats, but Coach Heatly never let him "go in" early. As a matter of fact, Danny usually stayed until everyone else went in to get dressed. He was a quarterback though, and needed the extra practice...
Coach Heatly was my first organized school coach in Lindsay Jr. High, 1970, as my 8th grade football coach. For competitive sports, we only had "little league" prior to 1970, and the coaches weren't mean (We didn't have to run much and didn't get chewed out, which was just the opposite in Jr. High football. I was a player for the Leopard Cubs (as we were called), as was Danny Heatly, Coach Heatly's son, and my future brother-in-law - as my sister Dana would soon marry him. At the end of each football practice - Coach Heatly had wind-sprints in store for us. We would run 6 or 8 50's at which time Heatly began allowing the winner of each sprint to "go in". I was fairly fast, by Leopard standards, so would usually win the first sprints before beginning the elimination sprints. Danny was also fast, but usually finished in the middle of the pack, before it counted. As the first elimination sprint was run, I noticed that I had not finished first, but Danny had won. He had smartly saved his best for when it counted, and would get to "go in". Not so fast, though, as to prevent Charlie from noticing. I can still hear Coach Heatly say "Jimmy, you can go in, Danny you can stay out here." Danny won the next several heats, but Coach Heatly never let him "go in" early. As a matter of fact, Danny usually stayed until everyone else went in to get dressed. He was a quarterback though, and needed the extra practice...
Monday, October 8, 2018
False Assumptions in "Right-Sizing Oklahoma Districts"
James R. Machell, Ph.D., a University of Central Oklahoma professor, has published a 16 page "white paper" - "Right Sizing" Oklahoma Districts: Examining district size, enrollment, and superintendent compensation in Oklahoma School Districts. His "abstract" of the research paper reads "This paper includes data related to the number and size of school districts and superintendent salaries in the state of Oklahoma. It is intended to encourage dialogue among elected state leaders and citizens about the need to consider cost savings that could result in badly needed additional funding being directed to classrooms across the state through cost savings that could be realized through the reorganization of many of the small school districts across Oklahoma." Many traditional public school supporters interpret the intent of the paper and the abstract is to convince "elected state leaders and citizens" that major school consolidation would put $27 million back in Oklahoma public school classrooms. A re-write of the abstract with interpreted intent is as follows: This paper includes data related to the number and size of school districts and superintendent salaries in the state of Oklahoma - "There are too many school districts which are small (less than 3,500 students) and those district superintendent salaries are far too large." It is intended to encourage dialogue... - "It is intended to encourage school consolidation..." ... cost savings that could be realized through the (reorganization) - consolidation of many of the small (and medium sized) school districts across Oklahoma.
Before we analyze Dr. Machell's data, analysis, and recommendations, we must examine the probable origin of the non-biased white paper. One has to look no further than Senate Bill 920 which Senator *** authored during the 2018 regular session. Dr. Machell works for the University of Central Oklahoma (UCO) in Edmond, which is very near Senate District 22. Machell is also probably a constituent of Senator ****. SB 920 would have administratively consolidated all Oklahoma traditional public schools with less than 200 students. When it was disclosed that consolidating designated schools would save virtually no taxpayer dollars - the committees to which it was assigned quickly killed it. Many public school supporters believe that Senator **** is the driving force for the research paper published by Dr. Machell. The paper has certainly encouraged dialogue concerning school consolidation, but also advocates administratively consolidating schools with less than 1,000 students, before consolidating schools with less than 3,500 students. So, Dr. Machell has in effect - "doubled down" on the original "less than 200 students" consolidation plan. Dr. Machell claims that $27 million could be saved by "eliminating" superintendents, so we'll examine his data and subsequent analysis for accuracy.
While the data quoted and utilized by Dr. Machell is for the most part accurate, the true number of Oklahoma school districts seems to elude him - as 524, 588, and 607 are quoted in different sections of his research. The State Department of Education even lists 546 as the number of Oklahoma school districts. This datum point may be irrelevant though, as Dr. Machell is relatively sure there are 538 total superintendents - and what he believes is relevant to his study is consolidating superintendents. (note: Dr. Machell never uses the term "consolidate" in his paper. He prefers "reorganize", as it is less threatening. It's like saying - "This will be painless".
Dr. Machell finally concludes that by using his consolidation model, we could eliminate 300+ superintendents and pare the number down to a total of 200... and save $27 million. He finally disclaims that there are a number of reasons why his approach to (consolidating) superintendents may not work. These include the difficulty politically and practically in (consolidating) school districts. ... the details associated with the practical details of managing such a change is complicated and messy. State leaders have considered various approaches to school district (consolidation) and some officials have studied efforts in other states with little to show in terms of results. Some have found that school district (consolidation) actually does little to save money and increase efficiencies.
From an article by Emily Windler of KOSU in 2016, paraphrased: The states of Oklahoma and Louisiana have about the same number of students (664,200 and 665,478, respectively), while Oklahoma has 516 school districts (superintendents) and Louisiana has only 70 school districts (superintendents). Anyone would tend to believe that Oklahoma spends more on General Administration and Total Administration than Louisiana does, but the facts say something completely opposite this assumption. According to the 2014 U.S. Census data - Louisiana, with 70 school superintendents, spent $179,587,000 on General Administration and $586,168,000 in total Administrative Spending. Oklahoma, on the other hand, with over 500 school superintendents, spent $175,201,000 on General Administration and $465,532,000 in Total Administration Spending. (Superintendent salaries in both states are about the same).
One example of administrative consolidation which actually increased administrative costs is right next door in neighboring Arkansas. From 2003 to 2006, Arkansas reduced its school districts and superintendents from 367 to 246. For the 2007-2008 school year, instead of reducing administrative expenses, school administrative costs actually increased 10%! Cases like Arkansas' are repeated over and over again, like in West Virginia, South Carolina, etc...
In April of 2018, we analyzed the "virtual" consolidation of twelve traditional public schools in one rural county - to determine the administrative cost savings when the twelve superintendents were rolled into one county superintendent. The cost savings were proven to be minimal, and most likely none. Using one model of consolidation, administrative costs even increased after the twelve schools were virtually consolidated. We may now virtually consolidate state traditional public schools utilizing the "Machell" model of school consolidation (which he calls re-organization) to determine if the state can actually (virtually) save $27 million. We will analyze the data from four mid-size schools (more than 1,000 students, but less than 3,500) by utilizing Total Expenditures, Total Administrative Expenditures, and Total Superintendent Salaries. Only the totals for each category will be analyzed, since the data can be accessed in the Oklahoma Cost Accounting System. The Total Expenditures for all four schools during the 2016 fiscal year was $66,796,664. Total Administrative Expenditures for the schools was $2,398,773 (3.6% of Total Expenditures) and Total Superintendent Salaries was $444,535 (.7% of Total Expenditures).
Dr. Machell believes the state can save money if three of the four superintendents are eliminated from the school payroll ($27 million statewide). If the "Machell Model" were used to administratively reorganize the four districts, he believes one superintendent would earn $150,000 and the schools, once consolidated, would save $294,535 in superintendent salaries. While it may be accurate to say "$294,535 will be saved in superintendent salaries" once three superintendents are eliminated, it's not accurate to say that $294,535 will be saved in Total Expenditures or Total Administrative Expenditures. Knowing that by eliminating superintendent services will only
shift the administrative costs to other administrative categories, such as an assistant superintendent or principal salary - the Office of Accountability provided and additional $100,000 to each consolidated school's Total Administrative Expenditures category (in its 2010 "cost of efficiency" model). Because of increased costs since 2010, we'll virtually add $110,000 to each of the three consolidated schools' Total Admin. Expenditures. The final "virtual" Total Superintendent Salaries, after consolidating will now be $480,000, as compared to $444,535 before consolidation. Of course, this virtual consolidation scenario is only anecdotal, a snapshot, but it would probably play out identically if all schools with less than 3,500 students are consolidated. If the state were forced to pay an additional $12,000 for each consolidated school (less than 3,500 students, which totals approx. 500 districts), the Total Administrative Expenditure increase could reach $6 million.
Dr. Machell claims that by reducing the number of superintendents in Oklahoma - $27 million will be saved for instructional costs, but fails to quote even one state where he finds this is true. We've already compared Louisiana's Administrative costs, with only 70 superintendents, to Oklahoma's 538 superintendents. What about other states with fewer superintendents though? Surely there are some states with fewer superintendents than Oklahoma... which spend less money for Administration?
State No. of Supts. No. of Students Admin. $/student
Alabama 180 743,789 $813
Arkansas 289 492,132 $732
Kentucky 186 686,598 $810
Oklahoma 538 692,878 $686
South Carolina 102 763,533 $712
West Virginia 57 277,452 $826
The state's four virtual charter schools will be immune from any consolidation efforts because three of them are privately managed, so the state can't touch them without additional legislation. We'll take a look at the data anyway, and compare to the four traditional schools. Total Expenditures for the virtuals during the 2016 fiscal year was $47,208,232; Total Administrative Expenditures was $2,894,146 (6.1%) and Total Superintendent Salaries was $1,235,130 (2.6%). This total is debatable because virtual schools code the Superintendent Salaries in several subcategories, such as 2500 Business Office. Anyone familiar with gazintas can plainly see that 6.1% > 3.6% and 2.6% > .7%. The question now becomes - Why have our state lawmakers granted immunity from consolidation to the virtual charter schools?
Before we analyze Dr. Machell's data, analysis, and recommendations, we must examine the probable origin of the non-biased white paper. One has to look no further than Senate Bill 920 which Senator *** authored during the 2018 regular session. Dr. Machell works for the University of Central Oklahoma (UCO) in Edmond, which is very near Senate District 22. Machell is also probably a constituent of Senator ****. SB 920 would have administratively consolidated all Oklahoma traditional public schools with less than 200 students. When it was disclosed that consolidating designated schools would save virtually no taxpayer dollars - the committees to which it was assigned quickly killed it. Many public school supporters believe that Senator **** is the driving force for the research paper published by Dr. Machell. The paper has certainly encouraged dialogue concerning school consolidation, but also advocates administratively consolidating schools with less than 1,000 students, before consolidating schools with less than 3,500 students. So, Dr. Machell has in effect - "doubled down" on the original "less than 200 students" consolidation plan. Dr. Machell claims that $27 million could be saved by "eliminating" superintendents, so we'll examine his data and subsequent analysis for accuracy.
While the data quoted and utilized by Dr. Machell is for the most part accurate, the true number of Oklahoma school districts seems to elude him - as 524, 588, and 607 are quoted in different sections of his research. The State Department of Education even lists 546 as the number of Oklahoma school districts. This datum point may be irrelevant though, as Dr. Machell is relatively sure there are 538 total superintendents - and what he believes is relevant to his study is consolidating superintendents. (note: Dr. Machell never uses the term "consolidate" in his paper. He prefers "reorganize", as it is less threatening. It's like saying - "This will be painless".
Dr. Machell finally concludes that by using his consolidation model, we could eliminate 300+ superintendents and pare the number down to a total of 200... and save $27 million. He finally disclaims that there are a number of reasons why his approach to (consolidating) superintendents may not work. These include the difficulty politically and practically in (consolidating) school districts. ... the details associated with the practical details of managing such a change is complicated and messy. State leaders have considered various approaches to school district (consolidation) and some officials have studied efforts in other states with little to show in terms of results. Some have found that school district (consolidation) actually does little to save money and increase efficiencies.
From an article by Emily Windler of KOSU in 2016, paraphrased: The states of Oklahoma and Louisiana have about the same number of students (664,200 and 665,478, respectively), while Oklahoma has 516 school districts (superintendents) and Louisiana has only 70 school districts (superintendents). Anyone would tend to believe that Oklahoma spends more on General Administration and Total Administration than Louisiana does, but the facts say something completely opposite this assumption. According to the 2014 U.S. Census data - Louisiana, with 70 school superintendents, spent $179,587,000 on General Administration and $586,168,000 in total Administrative Spending. Oklahoma, on the other hand, with over 500 school superintendents, spent $175,201,000 on General Administration and $465,532,000 in Total Administration Spending. (Superintendent salaries in both states are about the same).
One example of administrative consolidation which actually increased administrative costs is right next door in neighboring Arkansas. From 2003 to 2006, Arkansas reduced its school districts and superintendents from 367 to 246. For the 2007-2008 school year, instead of reducing administrative expenses, school administrative costs actually increased 10%! Cases like Arkansas' are repeated over and over again, like in West Virginia, South Carolina, etc...
In April of 2018, we analyzed the "virtual" consolidation of twelve traditional public schools in one rural county - to determine the administrative cost savings when the twelve superintendents were rolled into one county superintendent. The cost savings were proven to be minimal, and most likely none. Using one model of consolidation, administrative costs even increased after the twelve schools were virtually consolidated. We may now virtually consolidate state traditional public schools utilizing the "Machell" model of school consolidation (which he calls re-organization) to determine if the state can actually (virtually) save $27 million. We will analyze the data from four mid-size schools (more than 1,000 students, but less than 3,500) by utilizing Total Expenditures, Total Administrative Expenditures, and Total Superintendent Salaries. Only the totals for each category will be analyzed, since the data can be accessed in the Oklahoma Cost Accounting System. The Total Expenditures for all four schools during the 2016 fiscal year was $66,796,664. Total Administrative Expenditures for the schools was $2,398,773 (3.6% of Total Expenditures) and Total Superintendent Salaries was $444,535 (.7% of Total Expenditures).
Dr. Machell believes the state can save money if three of the four superintendents are eliminated from the school payroll ($27 million statewide). If the "Machell Model" were used to administratively reorganize the four districts, he believes one superintendent would earn $150,000 and the schools, once consolidated, would save $294,535 in superintendent salaries. While it may be accurate to say "$294,535 will be saved in superintendent salaries" once three superintendents are eliminated, it's not accurate to say that $294,535 will be saved in Total Expenditures or Total Administrative Expenditures. Knowing that by eliminating superintendent services will only
shift the administrative costs to other administrative categories, such as an assistant superintendent or principal salary - the Office of Accountability provided and additional $100,000 to each consolidated school's Total Administrative Expenditures category (in its 2010 "cost of efficiency" model). Because of increased costs since 2010, we'll virtually add $110,000 to each of the three consolidated schools' Total Admin. Expenditures. The final "virtual" Total Superintendent Salaries, after consolidating will now be $480,000, as compared to $444,535 before consolidation. Of course, this virtual consolidation scenario is only anecdotal, a snapshot, but it would probably play out identically if all schools with less than 3,500 students are consolidated. If the state were forced to pay an additional $12,000 for each consolidated school (less than 3,500 students, which totals approx. 500 districts), the Total Administrative Expenditure increase could reach $6 million.
Dr. Machell claims that by reducing the number of superintendents in Oklahoma - $27 million will be saved for instructional costs, but fails to quote even one state where he finds this is true. We've already compared Louisiana's Administrative costs, with only 70 superintendents, to Oklahoma's 538 superintendents. What about other states with fewer superintendents though? Surely there are some states with fewer superintendents than Oklahoma... which spend less money for Administration?
State No. of Supts. No. of Students Admin. $/student
Alabama 180 743,789 $813
Arkansas 289 492,132 $732
Kentucky 186 686,598 $810
Oklahoma 538 692,878 $686
South Carolina 102 763,533 $712
West Virginia 57 277,452 $826
The state's four virtual charter schools will be immune from any consolidation efforts because three of them are privately managed, so the state can't touch them without additional legislation. We'll take a look at the data anyway, and compare to the four traditional schools. Total Expenditures for the virtuals during the 2016 fiscal year was $47,208,232; Total Administrative Expenditures was $2,894,146 (6.1%) and Total Superintendent Salaries was $1,235,130 (2.6%). This total is debatable because virtual schools code the Superintendent Salaries in several subcategories, such as 2500 Business Office. Anyone familiar with gazintas can plainly see that 6.1% > 3.6% and 2.6% > .7%. The question now becomes - Why have our state lawmakers granted immunity from consolidation to the virtual charter schools?
Friday, October 5, 2018
State Question 800 and 801
Two state questions which may profoundly affect schools and potentially increase taxes for Oklahomans are State Question 800 and State Question 801. Voters will decide these questions on November 6, 2018. Both questions sound really benign and are touted as the answers for funding public schools and balancing the state budget, but are really not designed to do either.
The Oklahoma State School Boards Association (OSSBA) states that "State Question 800 is a proposed state Constitutional amendment to create a new state budget reserve fund to collect an increasing percentage of collections from the gross production tax (GPT) on oil and gas. This off-the-top set-aside to the new Oklahoma Vision Fund would begin on July 1, 2020..." Eventually, 100% of GPT collections will be deposited in the fund and after July 1,2020, 4 percent of the fund's principal will be deposited each year into the state's General Revenue Fund. The OSSBA reports that schools now receive about 10% of all gross production revenue in dedicated funding outside of the appropriations process. "The annual diversion of GPT collections would erode the level of dedicated funding and take millions of dollars in potential funding for schools off the table every year... and will eventually eliminate GPT as a dedicated revenue source for schools."
One scenario which may occur if SQ 800 is approved: If GPT is eliminated as a dedicated revenue source for schools, the legislature will have no choice but to provide more appropriated revenue to schools.. in order to make up the loss. In order to provide more appropriated revenue to schools - taxes on working Oklahomans will likely increase. This is not good. Another scenario is that the once dedicated GPT may be sent to schools through the appropriations process, where all public schools will receive an equitable appropriation, but will still be much less than their original dedicated amount. This scenario is not good either, but is more likely, since charter schools are clamoring for more tax dollars. The legislature is likely to increase taxes in either scenario. If one considers himself/herself a "low tax" conservative, they should vote "NO" on SQ 800.
State Question 801 will allow public schools to utilize Building Fund monies for operational expenses, like teacher salaries. Currently, schools receive local ad valorem (property tax) monies to maintain school buildings. The funding cannot be used for teacher salaries, etc... Those lawmakers supporting SQ 801 believe that schools should have the flexibility to use building funds for operational expenses. The only problem with this scenario is that schools receive unequal amounts of building fund monies, because it is based on the property value in each district. For instance, one school with 1,000 students and 35 teachers may receive $50,000 per year in building funds, but another school with the same number of students and teachers may receive $1 million. The first school spends its entire $50,000 for building maintenance and upkeep, while the second school spends $50,000 on building maintenance, but has $950,000 to pay its 35 teachers more money - which results in a $27,000 raise for teachers. The previous example is exaggerated to provide the context of unequal treatment, but still exists.
Many conservatives believe that the approval of SQ 801 will eventually lead to higher property taxes for home and land owners and here's how: If SQ 801 is approved by voters in November, the next thing lawmakers will likely do is to try to equalize building fund monies for schools statewide. Our state lawmakers cannot re-distribute local property taxes for schools without controlling all local property tax statewide. Stay with me now... If the representatives and senators can acquire control over local ad valorem revenue, under the guise of equalizing now operational dollars, they may effectively increase this taxation, in order to provide for the schools which do not receive as much as others. Many conservatives will vote "No" on SQ 801, for this reason alone - it is a veiled attempt to increase your taxes...
Update: October 17, 2018 - The Daily Oklahoman claims support for State Question 801 in Measure would provide school districts flexibility in the Tuesday edition of the editorial page. The opinion of the editorial team is that property rich school districts should be allowed to use "Building Fund" money for operational expenses, including teacher salaries, because it will lead to better school management.
Presently, schools receive 5 mils of property tax for school building maintenance and repairs. Many schools save their building revenue for other purposes, such as a new roof or other small building improvements. As noted previously, not all schools are equal in receiving building revenue and many schools already use excess building revenue for custodial and maintenance employee salaries. Spending Building Fund revenue for custodial and maintenance salaries helps take the pressure off a school's General Fund, with which teacher salaries are paid - so many schools already use building funds for allowable salaries.
We predict two things will happen as a result of SQ 801 passage. First, look for legislation which will equalize Building Fund revenue statewide - so all public schools will be equalized in the acquisition of operational dollars. The only way lawmakers can provide equity for building fund revenue is to control local property taxation, and then re-distribute to all schools based on the number of students. This scenario will be good for some schools (especially the virtual charter schools which now receive no building fund revenue) and bad for others (the small schools which now receive no state funding). The state will now be responsible for funding those schools which presently are only locally funded, so lawmakers are likely to increase state taxes in order to properly fund them.
The second thing that will likely happen is that schools may be allowed to vote additional property tax millage (from 5 mils to 10 mils for Building Fund revenue), and property taxes will increase, thereby absolving the legislative responsibility for appropriately funding our public schools.
The Oklahoma State School Boards Association (OSSBA) states that "State Question 800 is a proposed state Constitutional amendment to create a new state budget reserve fund to collect an increasing percentage of collections from the gross production tax (GPT) on oil and gas. This off-the-top set-aside to the new Oklahoma Vision Fund would begin on July 1, 2020..." Eventually, 100% of GPT collections will be deposited in the fund and after July 1,2020, 4 percent of the fund's principal will be deposited each year into the state's General Revenue Fund. The OSSBA reports that schools now receive about 10% of all gross production revenue in dedicated funding outside of the appropriations process. "The annual diversion of GPT collections would erode the level of dedicated funding and take millions of dollars in potential funding for schools off the table every year... and will eventually eliminate GPT as a dedicated revenue source for schools."
One scenario which may occur if SQ 800 is approved: If GPT is eliminated as a dedicated revenue source for schools, the legislature will have no choice but to provide more appropriated revenue to schools.. in order to make up the loss. In order to provide more appropriated revenue to schools - taxes on working Oklahomans will likely increase. This is not good. Another scenario is that the once dedicated GPT may be sent to schools through the appropriations process, where all public schools will receive an equitable appropriation, but will still be much less than their original dedicated amount. This scenario is not good either, but is more likely, since charter schools are clamoring for more tax dollars. The legislature is likely to increase taxes in either scenario. If one considers himself/herself a "low tax" conservative, they should vote "NO" on SQ 800.
State Question 801 will allow public schools to utilize Building Fund monies for operational expenses, like teacher salaries. Currently, schools receive local ad valorem (property tax) monies to maintain school buildings. The funding cannot be used for teacher salaries, etc... Those lawmakers supporting SQ 801 believe that schools should have the flexibility to use building funds for operational expenses. The only problem with this scenario is that schools receive unequal amounts of building fund monies, because it is based on the property value in each district. For instance, one school with 1,000 students and 35 teachers may receive $50,000 per year in building funds, but another school with the same number of students and teachers may receive $1 million. The first school spends its entire $50,000 for building maintenance and upkeep, while the second school spends $50,000 on building maintenance, but has $950,000 to pay its 35 teachers more money - which results in a $27,000 raise for teachers. The previous example is exaggerated to provide the context of unequal treatment, but still exists.
Many conservatives believe that the approval of SQ 801 will eventually lead to higher property taxes for home and land owners and here's how: If SQ 801 is approved by voters in November, the next thing lawmakers will likely do is to try to equalize building fund monies for schools statewide. Our state lawmakers cannot re-distribute local property taxes for schools without controlling all local property tax statewide. Stay with me now... If the representatives and senators can acquire control over local ad valorem revenue, under the guise of equalizing now operational dollars, they may effectively increase this taxation, in order to provide for the schools which do not receive as much as others. Many conservatives will vote "No" on SQ 801, for this reason alone - it is a veiled attempt to increase your taxes...
Update: October 17, 2018 - The Daily Oklahoman claims support for State Question 801 in Measure would provide school districts flexibility in the Tuesday edition of the editorial page. The opinion of the editorial team is that property rich school districts should be allowed to use "Building Fund" money for operational expenses, including teacher salaries, because it will lead to better school management.
Presently, schools receive 5 mils of property tax for school building maintenance and repairs. Many schools save their building revenue for other purposes, such as a new roof or other small building improvements. As noted previously, not all schools are equal in receiving building revenue and many schools already use excess building revenue for custodial and maintenance employee salaries. Spending Building Fund revenue for custodial and maintenance salaries helps take the pressure off a school's General Fund, with which teacher salaries are paid - so many schools already use building funds for allowable salaries.
We predict two things will happen as a result of SQ 801 passage. First, look for legislation which will equalize Building Fund revenue statewide - so all public schools will be equalized in the acquisition of operational dollars. The only way lawmakers can provide equity for building fund revenue is to control local property taxation, and then re-distribute to all schools based on the number of students. This scenario will be good for some schools (especially the virtual charter schools which now receive no building fund revenue) and bad for others (the small schools which now receive no state funding). The state will now be responsible for funding those schools which presently are only locally funded, so lawmakers are likely to increase state taxes in order to properly fund them.
The second thing that will likely happen is that schools may be allowed to vote additional property tax millage (from 5 mils to 10 mils for Building Fund revenue), and property taxes will increase, thereby absolving the legislative responsibility for appropriately funding our public schools.
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