Charter School Debt, Assets, and Fund Balances: Implications for Traditional Public School Districts

Ray Budde is credited with creating the charter school concept during the 1970’s. Budde envisioned unique educational laboratories granted charters to develop new and innovative ideas for everything from curriculum to pedagogy to governance. Once these new best practices were finalized, they would be shared with all schools throughout the state. Charter schools are granted more flexibility and autonomy from local board of education regulations and state laws in return for greater accountability to meet their charters’ performance and governance standards.

Charter schools are public schools authorized by either state government (e.g., State Department of Education), traditional public school districts (TPSDs), independent agencies, or colleges and universities depending state’s charter school law. Unlike many states, in New Jersey the state is the sole charter school authorizer. As a result, charter schools function independently from their host district’s board of education under a charter granted by the state (New Jersey Department of Education, 2001). According to the New Jersey Department of Education, as soon as the charter is approved by the Commissioner of Education, the school is governed by a board of trustees authorized by the State Board of Education and the charter school is granted all the necessary powers to execute and implement its charter while held accountable for achieving its charter’s goals.

In New Jersey, a charter school is funded based on its enrollment primarily by the per pupil revenues it receives from its host TPSD’s board of education. According to the New Jersey Department of Education, the host district’s board of education pays the charter school ninety percent of the TPSD’s grade level average per pupil cost-to-educate for each student the charter school enrolls (Bredehoft, 2005). For example, if a charter school enrolled 100 students each in grades one to twelve and the average TPSD per pupil costs-to-educate were $10,000 per elementary student, $12,000 per middle school student, and $14,000 per high school student, the TPSD would pay the charter school $12.78 million for that academic year. Although charter schools cannot charge tuition, they are eligible to receive federal and state funds.

State charter school laws vary concerning the acquisition of and responsibility for debt and ownership and disposition of assets including fund balances. Therefore, the extent to which charter schools can acquire, be held responsible for, or take ownership for debt and the assets acquired with that debt differs from how a typical TPSD uses municipal bonds to finance its capital projects and retains ownership for those assets and the related debt service. Unlike TPSDs, charter schools are not authorized to levy property taxes and can go out of business; therefore, TPSDs typically pay lower interest rates (Nelson, Muir, & Drown, 2000). However, New Jersey charter schools are authorized to maintain positive fund balances enabling charter schools to incur debt at lower interest rates (Nelson, Muir, & Drown, 2000).

New Jersey charter school law allows charter schools to acquire debt; however, the law is silent concerning the entity responsible for charter school debt and debt payment (Nelson, Muir, & Drown, 2000). Although New Jersey’s charter school law stipulates assets purchased with public funds of closed charter schools revert to the host TPSD or state that provided the public funds for acquisition, the definition of ownership is unclear. The lack of clarity results when charter schools lack access to municipal bond markets, authority to guarantee debt repayment, or the ability to “obligate future operating revenue toward the payment of debt for acquiring capital assets,” causing charter schools to find other ways to raise funds for debt payment (Baker & Miron, 2015, p. 29). Among the ways charter schools address this problem is “to establish separate non-profit entities to carry the debt burden” (Baker & Miron, 2015, p. 29). Charter management organizations (CMOs) have access to municipal bond markets, and can take ownership of debt and debt service along with the assets of the charter school managed by the CMO.

Closing a charter school raises major questions concerning charter school asset disposition because New Jersey charter school law is unclear concerning whether the state, host TPSD, or charter school is responsible for charter school debt and debt payment, and asset ownership (Nelson, Muir, & Drown, 2000). If the closed charter school’s debt and asset ownership is held by a separate non-profit entity or CMO, these assets (e.g., school buildings, playing fields, vehicles) do not revert to the host TPSD or state on closure because the debt and assets are not owned by the charter school but by a third party. These assets do not revert to the host TPSD on closure even if formerly owned by the host TPSD.

However, “In the absence of legislation, assets belong to the nonprofit corporation or entity holding the charter, and the laws governing nonprofit corporations guide the issuance of asset disposition” (Nelson, Muir, & Drown, 2000, p. 67). Green and Mead (2004) conclude “Under these laws, the nonprofit’s governing board has the power to dispose of assets once a charter school has closed” (p. 72). Thus, in the event of a charter school’s closure, the charter school’s students would return to the host TPSD as is their right but the assets would not necessarily follow the students. This is a clarion call to work with policymakers to address the state’s charter school law’s need for clarity concerning the acquisition of and responsibility for debt and ownership and disposition of assets in the event of closure.

References

Baker, B. D., & Miron, G. (2015). The business of charter schooling:  Understanding the policies that charter operators use for financial benefit. Boulder, CO:  National Education Policy Center.

Bredehoft, J. M. (2005). New Jersey charter schools:  History and information. New Jersey Community Capital, 1(1), Retrieved from http://www.newjerseycommunitycapital.org.

Green, P. C., & Mead, J. F. (2004). Charter school and the law:  Establishing new legal relationships. Norwood, MA:  Christopher-Gordon Publishers, Inc.

Nelson, F. H., Muir, E. & Drown, R. (2000). Venturesome capital:  State charter school finance systems. Washington, D.C.:  U.S. Department of Education.

New Jersey Department of Education, (2001).  Charter school evaluation report. New Jersey Department of Education. Retrieved from http://www.state.nj.us.

 

Charter School Closure: Implications for Traditional Public School Districts

Ray Budde is credited with creating the charter school concept during the 1970’s. Budde envisioned unique educational laboratories granted charters to develop new and innovative ideas for everything from curriculum to pedagogy to governance. Once these new best practices were finalized, they would be shared with all schools throughout the state. Charter schools are granted more flexibility and autonomy from local board of education regulations and state laws in return for greater accountability to meet their charters’ performance and governance standards.

Charter schools are public schools authorized by either state government (e.g., State Department of Education), traditional public school districts (TPSDs), independent agencies, or colleges and universities depending state’s charter school law. Unlike many states, in New Jersey the state is the sole charter school authorizer. As a result, charter schools function independently from their host district’s board of education under a charter granted by the state (New Jersey Department of Education, 2001). According to the New Jersey Department of Education, as soon as the charter is approved by the Commissioner of Education, the school is governed by a board of trustees authorized by the State Board of Education and the charter school is granted all the necessary powers to execute and implement its charter while held accountable for achieving its charter’s goals.

In New Jersey, a charter school is funded based on its enrollment primarily by the per pupil revenues it receives from its host TPSD’s board of education. According to the New Jersey Department of Education, the host district’s board of education pays the charter school ninety percent of the TPSD’s grade level average per pupil cost-to-educate for each student the charter school enrolls (Bredehoft, 2005). For example, if a charter school enrolled 100 students each in grades one to twelve and the average TPSD per pupil costs-to-educate were $10,000 per elementary student, $12,000 per middle school student, and $14,000 per high school student, the TPSD would pay the charter school $12.78 million for that academic year. Although charter schools cannot charge tuition, they are eligible to receive federal and state funds.

New Jersey charter school law lacks provisions for advance warning or lead time requiring a charter school to warn its host district of its impending closure unlike corporate bankruptcy provisions. Therefore, a charter school with an enrollment of 1,000 students could announce plans in April to close on June 30 forcing the host district to scramble to find the corresponding additional teachers, aides, classrooms, staff, technology, materials, supplies, and program and service levels by September. For example, a charter school may have enrolled 1,000 of 4,000 host district pupils since its opening leaving the host TPSD with 3,000 students. Once the charter school enrolled about 25 percent of its students, the host TPSD may have laid off teachers, aides, and staff, and sold school facilities because its costs did not decrease proportionately with lost enrollment. Thus, the host district would suddenly have but five months to equip itself to accommodate an additional 33% enrollment increase. Proper facility and personnel decisions and actions require more time.

State charter school laws vary concerning the acquisition of and responsibility for debt and ownership and disposition of assets including fund balances. Therefore, the extent to which charter schools can acquire, be held responsible for, or take ownership for debt and the assets acquired with that debt differs from how a typical TPSD uses municipal bonds to finance its capital projects and retains ownership for those assets and the related debt service. Unlike TPSDs, charter schools are not authorized to levy property taxes and can go out of business; therefore, TPSDs typically pay lower interest rates (Nelson, Muir, & Drown, 2000). However, New Jersey charter schools are authorized to maintain positive fund balances enabling charter schools to incur debt at lower interest rates (Nelson, Muir, & Drown, 2000).

New Jersey charter school law allows charter schools to acquire debt; however, the law is silent concerning the entity responsible for charter school debt and debt payment (Nelson, Muir, & Drown, 2000). Although New Jersey’s charter school law stipulates assets purchased with public funds of closed charter schools revert to the host TPSD or state that provided the public funds for acquisition, the definition of ownership is unclear. The lack of clarity results when charter schools lack access to municipal bond markets, authority to guarantee debt repayment, or the ability to “obligate future operating revenue toward the payment of debt for acquiring capital assets,” causing charter schools to find other ways to raise funds for debt payment (Baker & Miron, 2015, p. 29). Among the ways charter schools address this problem is “to establish separate non-profit entities to carry the debt burden” (Baker & Miron, 2015, p. 29). Charter management organizations (CMOs) have access to municipal bond markets, and can take ownership of debt and debt service along with the assets of the charter school managed by the CMO.

Closing a charter school raises major questions concerning charter school asset disposition because New Jersey charter school law is unclear concerning whether the state, host TPSD, or charter school is responsible for charter school debt and debt payment, and asset ownership (Nelson, Muir, & Drown, 2000). If the closed charter school’s debt and asset ownership is held by a separate non-profit entity or CMO, these assets (e.g., school buildings, playing fields, vehicles) do not revert to the host TPSD or state on closure because the debt and assets are not owned by the charter school but by a third party. These assets do not revert to the host TPSD on closure even if formerly owned by the host TPSD.

However, “In the absence of legislation, assets belong to the nonprofit corporation or entity holding the charter, and the laws governing nonprofit corporations guide the issuance of asset disposition” (Nelson, Muir, & Drown, 2000, p. 67). Green and Mead (2004) conclude “Under these laws, the nonprofit’s governing board has the power to dispose of assets once a charter school has closed” (p. 72). Thus, in the event of a charter school’s closure, the charter school’s students would return to the host TPSD as is their right but the assets would not necessarily follow the students. This is a clarion call to work with policymakers to address the state’s charter school law’s need for clarity concerning the acquisition of and responsibility for debt and ownership and disposition of assets in the event of closure.

References

Baker, B. D., & Miron, G. (2015). The business of charter schooling:  Understanding the policies that charter operators use for financial benefit. Boulder, CO:  National Education Policy Center.

Bredehoft, J. M. (2005). New Jersey charter schools:  History and information. New Jersey Community Capital, 1(1), Retrieved from http://www.newjerseycommunitycapital.org.

Green, P. C., & Mead, J. F. (2004). Charter school and the law:  Establishing new legal relationships. Norwood, MA:  Christopher-Gordon Publishers, Inc.

Nelson, F. H., Muir, E. & Drown, R. (2000). Venturesome capital:  State charter school finance systems. Washington, D.C.:  U.S. Department of Education.

New Jersey Department of Education, (2001).  Charter school evaluation report. New Jersey Department of Education. Retrieved from http://www.state.nj.us.

 

Statewide Voucher (tuition tax credit scholarship) Program: Diverting Funds from failing Traditional Public Schools

A statewide voucher or tuition tax credit scholarship program providing a tuition grant of $10,000 annually to any student attending a failing local public school district, which can be applied to any private religious or independent school, lacks educational equity and does not provide an equal educational opportunity for all students. Asymmetric information would adversely affect voucher users. Not all students have equal knowledge of or access to desirable private religious or independent schools. Private religious or independent schools may not be equitably available within a 20 mile radius. Tax credits disproportionately benefit the affluent and would result in the public subsidizing the voucher program. The voucher program provides an unequal opportunity for students to attend a private or religious school potentially providing a higher quality education. Moreover, state subsidies of religious schools violate the constitutional separation of church and state.

The voucher plan would divert scarce state funds from failing TPSs to private and religious schools. Failing districts are often found in poor urban areas. The failing schools, from which the voucher students would transfer, would lose enrollment based state and federal aid. These failing districts may be poor performing districts because they were traditionally under-resourced districts. These districts may have become failing because they lacked the property tax base with which to generate the revenues necessary to provide an educational quality commensurate with affluent districts. State and federal governments may have contributed to the under-resourcing by providing aid that neither funded all students’ needs nor accounted for the lack of a proper tax base.

A $10,000 tuition grant is inequitable. A $10,000 grant may be less than the per pupil cost for religious schools and independent schools’ tuition. If private religious or independent schools cannot reject potential voucher students even for lack of capacity, who pays the difference between the $10,000 tuition grant and religious schools’ per pupil cost or independent schools’ tuition creates inequities. Affluent parents could more easily afford to pay the delta while requiring all parents to pay the delta would disenfranchise low income and poor parents.

If private religious or independent schools are given no discretion on whether they can afford to accept voucher students, these schools might be forced to close, expand even if expansion was uneconomical, or create a two-tiered tuition scenario within the school with non-voucher students paying higher tuition to offset the voucher deficit. Should private independent schools have discretion, they might admit only voucher students whose parents were willing to pay the delta, fail undesirable voucher students (e.g., disciplinary records), or refuse voucher students that were more expensive to educate such as special education, ELL, and free-and-reduced-price lunch creating more inequities. Moreover, many religious schools are already financially distressed while others are closing due to budgetary pressures (see Baker, 2010).

Copying a practice common to professional sports, the voucher program would create student “free agents” who would have an opportunity to attend a private or religious school potentially providing a higher quality education. If the program did not require voucher students to attend their chosen school for the full academic year, these free agents could use their vouchers to transfer to another school midyear. Private or religious schools losing free agent voucher students during the year would lose voucher revenue. These schools would experience increased costs especially if they had hired additional personnel or built more classrooms and other facilities to accommodate voucher students.

If no deadline exists by which voucher students must enroll such as by April before the upcoming school year, enrollment would be difficult to forecast exposing operating budgets to greater risk. If private religious or independent schools are given no discretion on accepting vouchers students, the more desirable of these schools could suffer overcrowding and congestion. These problems could cause free agent voucher and more mobile non-voucher students to depart during the year exacerbating operating and financial problems. Housing values might plummet commensurate with increased school overcrowding. Also, enrollment increases stemming from vouchers might not be equally distributed among schools or by grade level.

If no provision is made to provide equally accessible and affordable transportation, vouchers would disproportionately benefit the affluent who can more easily afford transportation. Not all students would have equal access to private or public transportation including public light rail. If the failing school district was required to provide or pay for voucher student transportation, failing school costs would increase especially if transportation expenses were not capped.

Failing school neighborhoods or districts depress housing values because poor school quality is negatively capitalized in housing values. Low assessed housing values keep district property values low. Those who can vote with their feet move to districts providing housing and schools that better meet their preferences. White or middle class flight exacerbates the decline of neighborhoods as jobs and capital exit with them. Taxpayers are investors who want their major asset, their home, to appreciate in value. Home owners or catchment area residents have a vested interest in the success of their local TPSs because they strive to offset the risks posed by vouchers to their community-specific social capital and property values which cannot be easily diversified.

The voucher plan subsidizes private religious or independent schools at the expense of traditionally under resourced failing TPSs. The voucher plan is not a means for improving failing schools. On the contrary, the voucher plan creates a triple assault on failing TPSs. First, the voucher plan diverts essential funds away from needy TPSs. Second, the voucher plan causes failing TPSs losing voucher students to lose state and federal enrollment based aid. Third, failing TPSs’ costs increase because costs do not decrease proportionately with lost enrollment. The more mobile and affluent voucher students may be more likely to use vouchers. Losing voucher students increases the proportions of those more expensive to educate remaining in the failing TPSs increasing costs.

If vouchers were used to their logical extreme perhaps with full funding and transportation, large high poverty urban areas could lose students to the extent that the traditional public education system would close leaving a skeletal district. Lacking true TPSs, housing values might plummet further eroding the tax base and increasing the exodus of the remaining relatively more mobile and affluent taxpayers. Neighborhood erosion would accelerate driving out businesses and employment. If taken to the extreme, an unfettered voucher plan could culminate in the demise of urban areas with a preponderance of failing schools.

The provision of education through local public school districts in which students who live in the district attend its TPSs enables community members to get to know and understand one another. Fischel (2002) argues this “reduces the transaction costs of citizen provision of true local public goods” such as public education (p. 1). The public benefit of children attending their local schools rather than schools in more remote areas accrues to the families living in the catchment areas. This “network of adult acquaintances,” that Fischel (2002) defines as “community-specific social capital,” would be reduced to the extent voucher students left their residential district.

The publicness of local public schools is an argument against vouchers in the following sense. By enabling parents to select schools outside their communities and outside of local public supervision, vouchers work against the neighborhood and community networks that facilitate the bottom-up provision of local public goods. Community-specific social capital is more difficult to form if members of the community send their children to schools in other communities. (p. 1)

Vouchers erode community-specific social capital and, thereby, the public support necessary for proper public funding of public education.

References

Baker, B. D. (2010, March 23). Would $8,000 scholarships help sustain NJ private schools? [Web log post]. Retrieved from http://schoolfinance101.wordpress.com/2010/3/23/would_$8,000_scholarships_help_sustain_NJ_private_schools?

Fischel, W. A. (2002). An economic case against vouchers:  Why local public schools are a local public good. Dartmouth Economics Department Working Paper:  Dartmouth College, Hanover, NH.

 

Chartering In New Jersey: Diverting Funds from failing Traditional Public Schools

Increasing charter school availability would increase charter school market share of total district enrollment. Although charter schools would draw students from independent, private, and religious schools, charter school growth would result in many traditional public school (TPS) student transfers. Charter schools would draw students primarily from those TPSs that parents believe are providing an inferior educational quality or that do not meet their preferences.

Charter schools would divert funds from TPSs if charter schools receive 90% of the host district average per pupil costs by grade as charter schools do in New Jersey. TPSs losing students to charter schools lose state and federal enrollment based aid. TPSs’ costs increase because costs do not decrease proportionately with lost enrollment. If charter schools receive host district revenues based on a formula similar to New Jersey’s, charter schools would be given the incentive to locate in districts with high average per pupil spending and to enroll students whose cost to educate is below the district’s average.

Charter school expansion would draw students from religious schools possibly forcing some religious schools to close or merge. The influx of students who previously attended religious schools would increase the proportion of total district enrollment in public schools whether charter or TPS. This would increase the overall cost to the district of having charter schools because a greater proportion of students would be enrolled in public schools whether charter or TPS.

Charter schools could lower their costs while increasing the proportion of the higher cost to educate students remaining in TPSs by cream skimming in potential high test scoring, well behaving (e.g., no disciplinary records), or below district average cost to educate students or cropping out higher than district average cost to educate students such as special education, ELL, or free-and-reduced-price lunch students. Charter schools may not locate randomly but target large urban districts with high per pupil spending. District enrollment losses stemming from charter school transfers might not be equally distributed among schools or by grade level. Thus, charter school expansion would result in an inequitable distribution of school resources. The inequity would be exacerbated because large urban districts have been traditionally under resourced by state school aid formulas and lack a tax base with which to raise the revenues necessary to provide an educational quality commensurate with affluent districts.

If state charter school laws require TPS districts to fully fund district charter schools and pay student transportation to charter schools, large poor urban areas could lose even more students further increasing their costs and decreasing state and federal enrollment based aid. If no provision is made to provide equally accessible and affordable transportation, charter schools might disproportionately enroll more affluent students from families who can more easily afford transportation. Not all students would have equal access to private or public transportation including public light rail. This would result in inequitable access to charter schools.

Asymmetric information might favor more affluent families who would be more aware of charter school availability and quality. TPS catchment areas losing students to charter schools in other neighborhoods even within the same district might experience an exodus of the relatively more mobile and affluent parents with a corresponding decrease in housing values. If carried to its logical extreme, unfettered charter school growth could force TPS or TPS district closures leaving neighborhoods or districts without true TPSs.

Should charter schools exit the district or close once TPSs have closed, districts would be left without the provision of true public education. Lacking public schools, districts would be forced to transport their students to other TPS districts or seek admission to non-district charter schools depending on available capacity. The impact of extreme charter school expansion would result in an inequitable distribution, accessibility, and availability of public education whether charter schools or TPSs. The inequity would most adversely affect those least able to afford or having limited access to education alternatives.

 

Redistributing Statewide Taxes on Non-residential Properties: No Guarantee of Educational Funding Equity

Imposing statewide taxation of nonresidential properties and redistributing these pooled property tax revenues aims to reduce the per pupil tax base variation across communities that results in inequitable per pupil expenditures, inequitable educational resource distributions, and unequal educational opportunities. Property tax based inequities enable affluent districts’ to raise property tax revenues above state minimums and above the levels poor districts can raise. Affluent districts have an unfair advantage to provide an educational quality superior to poor districts resulting from their superior property tax base. Students in poor districts attend under resourced schools that lack the means with which to provide an educational quality commensurate with affluent districts.

A policy change that reduces the positive correlation between expenditures and ability to pay or that weakens the negative relationship between expenditures and the fraction of poor families in the community will be judged to be moving in the direction of a more equitable distribution of education services. (Ladd, 1976, p. 145)

Thus, property tax based inequities result in educational inequities and unequal educational opportunities among districts.

However, imposing statewide taxation of nonresidential properties and redistributing the statewide pooled nonresidential property tax revenues creates inequities. Disparities in per pupil property wealth and local property tax revenues causing inequities in per pupil expenditures would remain unless the redistribution of pooled nonresidential property tax revenues equalized per pupil expenditures among TPSs and districts. Total pooled nonresidential property tax revenues may be insufficient to equalize per pupil expenditures without additional state funding.

Commercial and industrial properties may be unequally distributed throughout the state creating inequities. Some districts may have a disproportionately large share of commercial and industrial properties with high assessed values. Replacing these districts’ nonresidential property tax revenues with lower statewide uniform property tax revenue would reduce their ability to provide the resources necessary for a quality education leading to a reduction in per pupil expenditures. Inequities would result to the degree that reductions were not based on a district’s ability to pay for the provision of quality education.

A statewide uniform nonresidential property tax creates inequities because property assessment practices can vary by region or county. Differences in property assessment practices result in different valuations of similar properties that are not a function of market forces among districts, regions, or counties. Nonresidential property tax abatements create inequities for the commercial and industrial businesses enjoying them if canceled by the state, and create problems for the statewide pooled property tax revenues should municipalities award abatements following the imposition of the statewide tax which the state could not cancel.

Inequities would be created depending on the proportions of local school, municipal, county, and nonresidential property taxes before imposition of the statewide tax. Districts relying disproportionately on residential property taxes or without nonresidential property taxes would receive incremental statewide nonresidential property tax revenues. Districts relying disproportionately on nonresidential property taxes most likely would experience a reduction in nonresidential property tax revenues that would shift the property tax burden to residential properties. Districts with disproportionately high shares of non-taxable properties (e.g., houses of worship, governmental facilities, universities, and parks) and nonresidential properties would experience a significant property tax burden shift to residential properties. Increasing the tax burden disproportionately on residential properties would lower housing values causing the relatively more mobile or affluent homeowners to move to districts meeting their preferences.

Imposing statewide taxation of nonresidential properties and redistributing the pooled nonresidential property tax revenue would not eliminate educational inequities stemming from property wealth inequality unless the redistribution equalized the ability to pay for education among districts statewide. Property tax based inequities would remain because affluent districts would retain the ability to raise property tax revenues above poor districts’ maximum levels. Affluent districts would continue their unfair advantage of providing an educational quality superior to poor districts because of their superior tax base. Poor districts may be under resourced because they lack the tax base necessary to provide an educational quality commensurate with affluent districts. Although redistributing statewide uniform property tax revenues would reduce per pupil expenditure disparities, the redistribution is unlikely to achieve educational equity by itself as Ladd (1979) concluded from her study of the Boston SMSA.

Without the assurance of a highly redistributive aid program, however, the equity case for removing business property from the local tax base in the Boston SMSA, where equity is defined in terms of the pattern of education expenditures, is a weak one.  (p. 149)

Thus, additional state revenues would be necessary to equalize per pupil expenditures, the ability to fund district education equitably, and equalize educational opportunities.

References

Ladd, H. F. (1976). State-wide taxation of commercial and industrial property for education. National Tax Journal, 29(2), 143-153.

 

Increasing State Equalization Aid 10%: No Guarantee of Equitable Educational Funding

Although increasing state equalization aid 10% would improve the distribution of education funding and local fiscal capacity, state equalization aid does not ensure equitable funding at levels commensurate with affluent districts. This approach tries to ensure equal local property tax burden and more equal total educational funding benefitting districts with low local fiscal capacity. However, state equalization aid does not achieve equity with affluent districts spending at higher levels. State equalization aid improves housing in traditionally low property value per pupil districts by improving the resources the district needs to provide an improved educational quality. The higher quality education provided by the district is capitalized improving property values. Although state equalization aid programs can lead to greater per pupil spending in traditionally under resourced districts, state equalization aid programs can result in lower average per pupil spending or a leveling down (Hoxby, 2001).

Typical state equalization aid programs have caps on the amount of state aid a district can receive which disadvantage economically challenged districts. Caps prevent the provision of a high level of equal educational opportunity stemming from equitable allocation of educational funds. Caps set below the per pupil aid level necessary to equitably fund education commensurate with affluent districts function like foundation aid programs. Metzler (2003) found that various approaches to improving equity in state aid including flat grants, foundation grants, percent equalization aid, guaranteed tax base, guaranteed yield, and full state funding result in no significant difference in the equitable distribution of education resources among districts. Metzler (2003) summarized “that while a state’s school finance approach is unrelated to equity outcome measures, it is significantly related to both the total spending per pupil and the percentage of that spending that comes from the state (rather than local districts)” (p. 588). Metzler (2003) concluded that “Percentage equalizing programs … are mathematically equivalent to a flat grant approach if states impose a ceiling on equalizing aid” (p. 591).

States often distribute aid using various approaches in addition to their state school funding formula which can offset programs intended to increase the equitable distribution of resources. Metzler (2003) describes how New York State manipulates its state school funding formula which uses a percentage equalizing approach to such an extent that the approach becomes “functionally equivalent to a foundation program” (p. 592). New York State’s school funding formula manipulation results in “one of the most inequitable allocations of resources in the country, with a wealth neutrality score of .17 (5^th highest in country) and a coefficient of variation of .20 (2^nd highest in the country)” (Metzler, 2003, p. 593). Thus, New York State reduces its state school funding formula to a minimal adequacy level with a basic guaranteed state funding level that is relatively constant for all districts regardless of aggregate student need.

References

Hoxby, C. M. (2001). All school finance equalizations are not created equal. Quarterly Journal of Economics, 116(4), 1189-1231.

Metzler, J. (2003). Inequitable equilibrium:  School finance in the United States. Indiana Law Review, (36)3, 561-608.

 

Adequacy is Inadequate

State aid formulas based on achieving adequacy may generate funding which states deem necessary to provide an adequate education. Such approaches are inequitable because students’ needs and the cost to educate each student based on his or her needs vary by school, district, and state. Adequacy approaches often fund districts based on average per pupil costs. This results in under resourced districts especially those with disproportionately high per pupil costs such as large urban districts.

Foundation aid formulas provide approximately the same aid per district regardless of the district’s ability to raise property tax revenue which exacerbates the inequitable resource gap among affluent and under resourced districts. Adequacy formulas even those with varying levels of aid based on district needs, aim to generate an adequate level of resources to meet an adequate level of state educational performance standards.

Funding to achieve adequacy rather than equity, results in adequate but inequitable educational resource allocation among schools and districts. Equity requires funding based on the cost to educate each student in his or her district. Equitable funding must be provided to enable every district to have the combined local, state, and federal funding necessary to provide a quality education commensurate with the most affluent districts. Equity will not be achieved by providing only a minimally adequate level that maintains the inequitable resource gap.

 

A Superior Alternative to Tracking or Detracking

To solve the challenges confronting our nation so that we can continue to improve our quality of life, we must improve education for all students because education is the cornerstone of our civilization and we need the talent level raised for every student if we are to accomplish this goal.  But our schools must provide more challenge for all students in all classes if our nation is to improve education.  State mandated restrictions and school district imposed curriculum limitations must be lifted to empower teachers to teach more and better classes as well as for all students to have the opportunity to learn as much as they possibly can. 

While performing consulting services for a wide range of school districts including Abbott, urban non-Abbott, suburban,DFG“I and J’s,” and rural districts, I have listened to students discussing the perceived shortcomings in the quality of their education and one the most commonly heard complaints is the lack of challenge especially in middle school and high school  classes.  Whether I attend the respective board of education meetings for these districts or interview parents as part of my research, I have learned how parents readily agree.  Students feel as if their classes too often level down to the lowest common denominator.  Students report that teachers spend too much time trying to raise the performance of the lowest common denominator while the more talented students as well as those most in need of instruction or those who are members of disadvantaged groups languish. 

Rubin (2003) and Wenger (2008) address many of these issues involved with how to properly perform instruction for all students especially classroom based instruction from perspectives that add value.  Rubin (2003) performed a year-long ethnographic case study of a group of students in detracked ninth grade English and history classes in a diverse urban high school.  Rubin (2003, p. 540) explores not only detracking which she describes as the “conscious organization of students into academically and racially heterogeneous classrooms” but also the kinds of social interactions that result from detracking both within and outside of the classroom.  Wenger (2008) presents a learning theory which is based on the “communities of practice” which is a process of social participation that students develop for learning and making meaning.  Her theory combines four essential components:  

Meaning:  a way of talking about our (changing) ability – individually and collectively – to experience our life and the world as meaningful.  Practice: a way of talking about the shared historical and social resources, frameworks, and perspectives that can sustain mutual engagement in action.  Community:  a way of talking about the social configurations in which our enterprises are defined as worth pursuing and our participation is recognizable as competence.  Identity:  a way of talking about how learning changes who we are and creates personal histories of becoming in the context of our communities.  (Wenger, 2008, p. 5) 

Rubin (2003, pp. 540-541) reports that the social dynamics in the “academically and racially heterogeneous classrooms,” which are not based on ability grouping …

were complex and mediated by notions of race, class, and academic competence that were forged in the larger school context.  For students, small groups often proved to be sites of tension and discomfort where fractures of race and class come to the fore.  This article describes how students enacted, or brought to life, the teaching practices of the detracked core program, reshaping them from the teachers’ original intentions.  Sometimes the result was a reiteration of the very inequalities that detracking was designed to address.  (Rubin 2003, p. 541) 

Like tracking, detracking is no panacea. Although detracking may have alleviated many of the shortcomings and group-based inequalities associated with tracking, it seems to have created its own inequities and ills of which the “bad split” is an example Rubin (2003, p. 550).  Perhaps one of the causal factors for the lack of challenge reported by students in my experience is the heterogeneous grouping within each class of students of all levels of ability in the same classroom with the same teacher at the same time.  It is likely that no matter how well qualified is the teacher; however, not even a teacher highly trained in differentiated instruction can overcome the problems of heterogeneous grouping.  It is profoundly difficult to differentiate instruction well enough within a classroom of 25 or more students so that all students benefit equally.  Rubin (2003, p. 556) reflects on this concept when she discusses the students’ priorities for their small work groups in the detracked classroom:  

In contrast to the value that teachers placed on balancing the membership of small groups for racial and academic diversity, students’ concerns about group membership were far more personal and pragmatic.  Students wanted group members who were academically competent, fun to be with, motivating, and respectful.  Many of these attributes were in conflict with the criteria that teachers used when configuring small groups.  (Rubin, 2003, p. 556) 

This fundamental desire on the part of all students to be among peers “who were academically competent, fun to be with, motivating, and respectful” regardless of racial, ethnic, or socio-economic class membership in my experience forces the top students to enroll in Advanced Placement or Honors courses so that their skill levels can be stretched while those students at the other end of the continuum who are generally those with the most severe needs seek remedial assistance. 

Tracking, on the other hand, is the grouping of students according to their level of ability in the same classroom with the same teacher at the same time.  Tracking may reflect the reality that students are not all alike.  Indeed, each student is unique and he/she learns in different ways, at different rates and performs best at varying degrees of course content difficulty.  Grouping classes according to ability may enable teachers to customize instruction so that the entire class not only learns more but also performs at a higher level of achievement.  Moreover, those students at the polar opposite ends of the ability continuum are not disenfranchised.  All students in every grade should be able to raise their achievement levels. 

The fundamental problem with tracking has been one of discriminatory implementation.  But no student should be locked into any track especially one that is lacking in proper content and challenge for that student.  Indeed, all students must be given the opportunity not only to improve their ability but also to advance to a higher level when they have demonstrated such improvement.  Tracking can be most effective when it enables students to benefit from rigorous teaching and is flexible based on the student’s unique abilities.  The reason why tracking and detracking fail to meet the educational needs and priorities of all students is found within the lack of proper classroom capacity.  Because schools too often especially those in urban school districts lack the physical space in which to teach a much wider range of ability groups, schools are faced with a dichotomous choice between tracking and detracking.  

Although I will present my alternative to the current dichotomous choice between tracking and detracking toward the end of this paper, the lack of proper classroom capacity has not always been the reason why all students could not learn and advance based on their unique abilities and time line.  As I recall from our week two readings, Mehan (1992) discussed how school psychologists were instrumental in determining not only the number of students classified as “mentally retarded” but also which students qualified for what is now referred to as special education.  But what is most interesting is that the term “retarded” or “mentally retarded” originated during the late nineteenth and early twentieth centuries when our nation was transitioning from one-room schoolhouses (i.e., one classroom for all students was the proper classroom capacity) to age-graded schools which occurred most dramatically in urban areas when large numbers of rural farm families moved to cities.  

Being “retarded” meant being too old for one’s grade or that “retardation” meant that the rural farm immigrant student took more than one year to complete a grade in his/her new age-graded school.  There was no concept of “retardation” in one-room schoolhouses because students regularly took time off from school to perform farm work returning once crops were planted or harvested to complete their studies and this was much more common for young rural male students.  Students simply returned to their respective in one-room schoolhouses and resumed their studies at the point at which they left.  The individual completion model of schooling employed in one-room schoolhouses was neither limited to nor a function of aged-based time slots.  The concept of “mental retardation” or “retardation,” therefore, is a tragic product of one of the earliest school reform movements.  That is, the nationwide adaptation of age-graded schools which could be perceived perhaps as a form of the “conscious organization of students into academically and racially heterogeneous classrooms” (Rubin, 2003, p. 540). 

Why do American students especially those in middle school and high school seem to lag behind those of other nations?  Mathematics provides a possible insight.  Perhaps it is because American students may not learn as much mathematics as do their international counterparts.  Compared to other nations where mathematics proficiency is rather high such asJapanandGermany, American students do not seem to study the same amount of geometry, algebra, and trigonometry.  Because the students of other nations attend more higher level math classes earlier in their school life, they are able also to study more and achieve greater proficiency in science courses especially physics including Advanced Placement physics.  When these factors are combined with the fact that most American school districts have either detracked or have maintained tracking, the mathematics education gap could widen. 

I will now address a rather thought provoking question:  “Is there another way to provide classroom instruction rather than through tracking, detracking, or a lowest common denominator (LCD) approach?”  Although the answer is yes, economic constraints on school facilities and staffing levels have created the dichotomous choice between tracking and detracking.  That is, the limitations of school facilities especially classroom space dictate the choice of either teaching students grouped according to ability or grouped within the same number of classrooms per school and taught in an LCD approach.  I argue that students suffer adverse educational consequences under either scenario. 

The “other way” is to cut the Gordian knot which bottleneck’s any alternative approach.  That is, to find a way in which to fund our schools without treating school funding as a zero-sum game in which, for example, if urban districts gain financial aid then their gain is or is perceived to be offset by an equal loss on the part of rural or suburban districts.  This lack of Pareto efficiency creates perpetual conflict among different districts, regions, and student populations which ultimately levels down the quality of education for all students but particularly for those that are at-risk and disadvantaged.  

My proposal to cut the Gordian knot of educational finance so as to provide the proper number and smaller sized classrooms necessary for increasing student achievement is to require the state and federal governments to fully fund all education mandates in advance of their implementation at the school level.  For example, in terms of special education and 504 Plan students, the state and federal governments would each pay their full share of their special education mandates such that no residual cost of special education is paid by any local school district.  Moreover, the state and federal governments would pay the fully allocated student cost and these monies would fully fund the student wherever he/she attended school regardless of geography. 

State issued budget caps, such asNew Jersey’s 2% cap, force local school districts to fund the unfunded portion of mandates which means that the typical district is regularly forced to cut non-mandate protected programs and services (i.e., regular education) to make up the difference.  This leads to conflicts among special and regular education parents primarily at the local level not to mention NCLB financial and operational penalties.  My proposal, however, would solve this problem.  Fully funding of all mandates would include but not be limited to those students who qualify for special education, free or reduced price lunches (i.e., poverty-level and economically challenged), LEP and ELL, and those from racial and ethnic minorities who have unique academic challenges.  This would lead to a massive increase of funding to urban and low income districts but without necessarily penalizing suburban and rural districts. 

ThePatersonpublic schools serve as an excellent example.  Paterson’s student enrollment is approximately 33,000, of which two-thirds qualify for special education while the other students generally qualify for free or reduced price lunches (i.e., poverty-level and economically challenged), LEP and ELL, and those from racial and ethnic minorities who have unique academic challenges.  Although I have not performed a weighted student cost analysis, I estimate thatPaterson might qualify for almost 100% state and federal funding of all of its students’ fully loaded costs if their state and federal aid was based on my model.   

In terms of property taxes,New Jerseyshould eliminate county government which is duplicative and a source of corruption asConnecticutdid in 1960.  Eliminating this unnecessary layer of county government would not only save New Jersey over $6.3 billion annually in property taxes so as to provide more funds for our schools and alleviate the property tax burden so that districts would be much more likely to vote to increase school budgets but also eliminate the rationale for any state imposed budget caps (i.e., 2% cap) as well as other restrictions. 

The incremental funds made available through the full funding of all state and federal education mandates plus the elimination of county government should be readily applied to designing and retrofitting our schools with the flexible classroom capacity necessary to successfully approximate the instruction of very small groups of students in smaller class sizes.  This would provide the foundation for “another way” that is based on neither tracking nor detracking!  Rubin (2003, p. 568) echoes the essence of my model by stating, “Larger changes in school structure can address this issue as well, such as creating smaller schools-within schools that would explicitly foster community among diverse students.”  

References 

Mehan, H. (2000). Beneath the skin and between the ears:  A case study in the politics of representation. In B. Levinson et al. (Eds,), Schooling the symbolic animal:  Social and cultural dimensions of education (259-279).Lanham,MD:  Rowman & Littlefield, Inc. 

Rubin, B. C. (2003). Unpacking detracking:  When progressive pedagogy meets students’ social worlds. American Educational Research Journal 40(2):  539-573. 

Wenger, E. (1998). Communities of practice:  Learning, meaning and identity.Cambridge:  CambridgeUniversity Press.

Using Critical Race Theory to Frame an Understanding of the Education Debt

In their ground breaking article, Ladson-Billings and Tate introduced critical race theory (CRT) to education and explained how usingCRTas a conceptual framework could be “applied to our understanding of educational inequity” (Ladson-Billings & Tate, 1995, p. 55).  AlthoughCRTderived primarily from the work of Derrick Bell, Alan Freeman, and Richard Delgado (Delgado & Stefancic, 2001) and is grounded in critical legal studies (CLS),CRThas become a distinct “method of analysis in educational research” and “to fully utilizeCRTin education, researchers must remain critical of race, and how it is deployed” (DeCuir & Dixson, 2004, p. 30).  Ladson-Billings and Tate used an analogy with critical race legal theory to help defineCRT.  

To make parallel the analogy between critical race legal theory and traditional civil rights law with that of critical race theory in education and multicultural education we need to restate the point that critical race legal theorists have “doubts about the foundation of moderate/incremental civil rights law.”  The foundation of civil rights law has been in human rights rather than in property rights.  Thus, without disrespect to the pioneers of civil rights law, critical race legal scholars document the ways in which civil rights law is regularly subverted to benefit whites. . . . We argue that the current multicultural paradigm functions in a manner similar to civil rights law.  Instead of creating radically new paradigms that ensure justice, multicultural reforms are routinely “sucked back into the system” and just as traditional civil rights law is based on a foundation of human rights, the current multicultural paradigm is mired in liberal ideology that offers no radical change in the current order.  Thus, critical race theory in education, like its antecedent in legal scholarship, is a radical critique of both the status quo and the purported reforms.  (Ladson-Billings & Tate, 1995, p. 62) 

AlthoughCLSchallenged the White system of meritocracy (DeCuir & Dixson, 2004, p. 27),CRTwent further in challenging the ways in which White supremacy and race-based power relationships are produced and perpetuated (Cook, 1995; Crenshaw, 1995; Dalton, 1995; Matsuda, 1995) based on racism as a permanent fixture in society (Bell, 1992, 1995; Lawrence, 1995; Ladson-Billings, 2009), identifying one’s own reality through storytelling or counter-storytelling (Delgado, 1990; Matsuda, 1995), the intersection of race and property rights or Whiteness as property (DeCuir & Dixson, 2004; Harris, 1993; Ladson-Billings & Tate, 1995; Ladson-Billings, 2009), and how civil rights legislation and educational reforms are enacted only if they ultimately serve the interests of Whites (Bell, 1980; Ladson-Billings & Tate, 1995;  Ladson-Billings, 2009). 

CRTprovides a conceptual framework for understanding the inequalities in education that result primarily from race and racism and seeks an accelerated rate of educational reform. CRTfocuses on the ongoing adverse impact of racism and how institutional racism privileges Whites in education while disadvantaging racial minorities.  DeCuir and Dixson (2004) summarize the extent to which racism permeates our society:  

Furthermore, the notion of the permanence of racism suggests that racist hierarchical structures govern all political, economic, and social domains.  Such structures allocate the privileging of Whites and the subsequent Othering of people of color in all arenas, including education.  (DeCuir & Dixson, 2004, p. 27)  

Counter-storytelling uses personal narratives to highlight shared experiences of racism and dispel racial stereotypes especially those held by the majority as DeCuir and Dixson (2004) explain: 

Counter-storytelling is a means of exposing and critiquing normalized dialogues that perpetuate racial stereotypes.  The use of counterstories allows for the challenging of privileged discourses, the discourses of the majority, therefore, serving as a means for giving voice to marginalized groups.  (DeCuir & Dixson, 2004, p. 27)   

Storytelling helps racial minorities to use their experiences of racial oppression to strengthen their identities as would increasing the use of minority discourse in our schools.  

The core tenet ofCRTthat addresses the underlying rational for the inequalities of the educational system is property rights.  Ladson-Billings and Tate reflect the crucial role that property rights plays in our educational system particularly the notion of Whiteness as property in their argument for aCRTapproach to education, “U.S. society is based on property rights rather than human rights” and “the intersection of race and property creates an analytical tool for understanding inequity” (Ladson-Billings & Tate 1995, p. 47).  Ladson-Billings (2009) provides the historical connection of property rights and ownership to citizenship with implications for how the notions of citizenship as well as property rights and ownership affect minorities within the educational system. 

In the early history of the nation only propertied White males enjoyed the franchise.  The significance of property ownership as a prerequisite to citizenship was tied to the British notion that only people who owned the country, not merely those who lived in it, were eligible to make decisions about it.  (Ladson-Billings, 2009, p. 25) 

In this way, Ladson-Billings (2009) explains how property rights, citizenship, and race are crucial to understandingCRT’s conceptual framework for education.  

Property ownership and Whiteness are necessary conditions for property rights which frames property in cultural as well as racial terms such that Whiteness becomes property.  Ladson-Billings and Tate (1995) cite Harris’ explanation of how the reification of race establishes Whiteness as property through Harris’ (1993) functions or rights of property, “(1) rights of disposition; (2) rights to use and enjoyment; (3) reputation and status property; and (4) the absolute right to exclude” (Ladson-Billings & Tate, 1995, p. 59).  Ladson-Billings and Tate (1995) use theCRTconceptual framework to explain how property rights not only serve the self-interest of Whites but also provide the undergirding for White hegemony over education.  Whiteness, therefore, becomes the ultimate property value that Whites leverage to perpetuate their system of educational advantages and privileges.  

Ladson-Billings and Tate (1995) use theCRTperspective to show that culturally based property rights help to explain how the privileges associated with Whiteness lead to the objectification and subordination of racial minorities especially African Americans within the education arena.  Harris’ (1993) rights of disposition indicate that property rights such as Whiteness are transferable but only when they serve the self-interest of Whites.  Although only Whites naturally possess Whiteness, Whiteness can be transferred such as by rewarding minority students for conformity to “White norms” or punishing minority students for violating “White norms” (Ladson-Billings & Tate, 1995, p. 59). 

Harris’ (1993) rights to the use and enjoyment of property are reflected in how the curriculum is structured and to whom its access is limited.  Whiteness provides Whites with certain social, cultural, and economic privileges (McIntosh, 1990) including control over who has the right to the use and enjoy school property such as the curriculum (Kozol, 1991).  Ladson-Billings (2009) explains that control over the curriculum empowers Whites to determine which students have access not only to top quality curricula but also honors programs, advanced placement courses, gifted and talented programs as well as those courses that prepare students for college admission and academic success.  Ladson-Billings uses theCRTconceptual framework to define a school curriculum “as a culturally specific artifact designed to maintain a White supremacist master script” (Ladson-Billings, 2009, p. 29).  DeCuir and Dixson summarize White control over the curriculum as having “served to reify this notion of Whiteness as property whereby the rights to possession, use and enjoyment, and disposition, have been enjoyed almost exclusively by Whites” (DeCuir & Dixson, 2004, p. 28).  

“CRTsuggests that current instructional strategies presume that African American students are deficient” and “intelligence testing has been a movement to legitimize African American student deficiency” (Ladson-Billings, 2009, pp. 29, 30).  These assumptions are consistent with Harris’ (1993) functions or rights of reputation and status property.  Ladson-Billings and Tate explain how Harris’ tenet applies to schools, “to damage someone’s reputation is to damage some aspect of his or her personal property” which when applied schools means that “to identify a school or program as nonwhite in any way is to diminish its reputation or status” (Ladson-Billings & Tate, 1995, p. 60).  Poor urban school districts with concentrations of minority students suffer poor reputations and low status as compared to their White suburban counterparts.  

The school system component that portrays Harris’ (1993) absolute right to exclude as well asCRT’s conception of American educational inequality and racism is the inequitable funding of schools that is based on property values.  Although wealthy school districts can afford a higher level of property taxes with which to fund their schools and provide a higher quality of education based on their higher property values, economically disadvantaged school districts are not able to raise the local property tax revenues necessary to fund a commensurate level of education for their students.  Ladson-Billings and Tate explain that a school’s curriculum is also a form of intellectual property that demonstrates Harris’ (1993) absolute right to exclude, “The quality and quantity of the curriculum varies with the ‘property values’ of the school” (Ladson-Billings & Tate, 1995, p. 54).  Ladson-Billings and Tate use curriculum to demonstrate how property rights accrue to property owners and the extent to which a school benefits from its property rights is in direct proportion to the amount and kinds of property it owns.  

The availability of “rich” (or enriched) intellectual property delimits what is now called “opportunity to learn – the presumption that along with providing educational “standards” that detail what students should know and be able to do, they must have the material resources that support their learning.  Thus, intellectual property must be undergirded by “real” property, that is, science labs, computers and other state-of-the-art technologies, appropriately certified and prepared teachers.  Of course, Kozol demonstrated that schools that serve poor students of color are unlikely to have access to these resources and, consequently, students will have little or no opportunity to learn despite the attempt to mandate educational standards.  (Ladson-Billings & Tate, 1995, pp. 54-55) 

In terms of the disparities in school district funding that disproportionately restrict the level, quality, and availability of financial, material, and human resources to low income urban school districts with concentrations of minorities, “CRTargues that the inequality in school funding is a function of institutional and structural racism” (Ladson-Billings, 2009, p. 31). CRT, therefore, seems to argue that Harris’ (1993) property function in terms of education is perhaps the most “powerful determinant of academic advantage” (Ladson-Billings, 2009, p. 32) because it represents the convergence of Whiteness as property and educational inequality. 

According to Ladson-Billings, “We do not have an achievement gap; we have an education debt” (Ladson-Billings, 2006, p. 5).  Ladson-Billings argues for reframing educational inequality inCRTterms by substituting her concept of an “education debt” for the achievement gap notion “as a way of explaining and understanding the persistent inequality that exists (and has always existed) in our nation’s schools” (Ladson-Billings, 2006, p. 4).  Ladson-Billings (2006) uses the national fiscal debt and deficit not only as metaphors for what she describes as the national education debt and deficit but also to demonstrate how the national focus on the educational achievement gap is misplaced.  That is, focusing on the educational achievement gap is a “misleading exercise” because achievement gap discourse “moves us toward short-term solutions that are unlikely to address the long-term underlying problem” caused by racism and reverse the policies that result in educational inequality (Ladson-Billings, 2006, p. 4). 

Ladson-Billings defines an educational deficit as equivalent to an annual fiscal operating deficit or the annual net of excess expenditures over revenues while the national education debt represents the cumulative legacy costs of educational inequality.  

The education debt is the foregone schooling resources that we could have (should have) been investing in (primarily) low income kids, which deficit leads to a variety of social problems (e.g., crime, low productivity, low wages, low labor force participation) that require on-going public investment.  This required investment sucks away resources that could go to reducing the achievement gap.  Without the education debt we could narrow the achievement debt.  …The message would be that you need to reduce one (the education debt, defined above) in order to close the other (the achievement gap).  (Ladson-Billings, 2006, p. 5) 

Although the nation has a long-standing accumulated education debt that has been amassed at the expense of disadvantaged students especially racial and ethnic minorities, the debt can not be eliminated as long as its debt service continues.  Ladson-Billings explains the challenge inherent in debt service that exacerbates the educational equity gap: 

When nations operate with a large debt, some part of their current budget goes to service that debt.  I mentioned earlier that interest payments on our national debt represent the third largest expenditure of our national budget.  In the case of education, each effort we make toward improving education is counterbalanced by the ongoing and mounting debt that we have accumulated.  That debt service manifests itself in the distrust and suspicion about what schools can and will do in communities serving the poor and children of color.  (Ladson-Billings, 2006, p. 9) 

Ladson-Billings’ (2006) notion of the education debt seems to argue that focusing on the achievement gap ignores how the education debt burdens African American students with race-based costs that are imposed by a racially biased school system. 

Ladson-Billings’ education debt concept refutes the achievement gap notion that largely ignores the importance for schools to have the proper educational inputs or financial and human resources with which to achieve the proper outcomes that the achievement gap defines in terms of test scores rather than what students actually learn in school and whether this learning process prepares them for success as adults.  The assumption embedded in the achievement gap is that the blame for schools failing to produce equal test score results among minority and majority students is placed on the students and teachers rather than on the unequal distribution of essential educational inputs.  Ladson-Billings’ (2006) education debt concept, therefore, reframes the achievement gap inCRTterms of educational inequality by shifting the paradigm to the equity gaps in school funding.  

The educational equity gap is a function of the unequal distribution of educational resources among our schools that disenfranchises low income urban school districts especially those with concentrations of minorities.  This results in continuing equity gaps and educational inequality.  In terms of theCRTconceptual framework, closing the educational equity gap by redistributing financial, material, and human resources requires that all schools have the necessary capacity to improve the achievement of all students especially racially, ethnically, and economically disadvantaged students such that every child is able to maximize his/her potential.

Shifting the paradigm to the equity gaps in school funding raises a question that if the amount, quality, and availability of financial, material, and human resources for all schools were equalized by race, ethnicity, socioeconomic status, and unique student needs would this rethinking of how to address educational inequality not only eliminate the annual education deficit and replace it with an education surplus but also ultimately pay down the education debt?   Ladson-Billings suggests that the answer may be found within theCRTconceptual framework.

CRTtakes to task school reformers who fail to recognize that property is a powerful determinant of academic advantage.  Without a commitment to redesign funding formulas, one of the basic inequities of schooling will remain in place and virtually guarantee the reproduction of the status quo.  (Ladson-Billings, 2009, p. 32) 

TheCRTconceptual framework for addressing educational inequality helps to frame the research question of what would constitute a model state school funding formula that distributes the necessary financial, material, intellectual, and human resource inputs equitably so that disadvantaged schools could achieve high levels of educational outcomes such as student achievement, learning, and knowledge-based skills which at least meet or exceed those of affluent schools for all students but especially those who are members of racial or ethnic minorities?  

References

Bell, D. A. (1980). Brown v. Board of Education and the interest convergence dilemma. Harvard Law Review, 93, 518-533. 

Bell, D. A. (1992). Faces at the bottom of the well:  The permanence of racism.New York:  Basic Books.  

Bell, D. A. (1995). Racial realism. In K. Crenshaw, N. Gotanda, G. Peller, & K. Thomas (Eds.), Critical race theory:  The key writings that formed the movement (pp. 302-312).New York:  The New Press.

Cook, A. E. (1995). Beyond critical legal studies:  The reconstructive theology of Dr. Martin Luther King. In K. Crenshaw, N. Gotanda, G. Peller, & K. Thomas (Eds.), Critical race theory:  The key writings that formed the movement (pp. 85-102).New York:  The New Press.  

Crenshaw, K. W. (1995). Mapping the margins:  Intersectionality, identity politics, and violence against women of color. In K. Crenshaw, N. Gotanda, G. Peller, & K. Thomas (Eds.), Critical race theory:  The key writings that formed the movement (pp. 357-383).New York:  The New Press. 

Dalton, H. L. (1995). The clouded prism:  Minority critique of the critical legal studies movement. In K. Crenshaw, N. Gotanda, G. Peller, & K. Thomas (Eds.), Critical race theory:  The key writings that formed the movement (pp. 80-84).New York:  The New Press. 

DeCuir, J. T., & Dixson, A. D. (2004). “So when it comes out, they aren’t surprised that it is there”:  Using critical race theory as a tool of analysis of race and racism in education. Educational Researcher 33(5)26-31. 

Delgado, R. (1990). When a story is just a story:  Does voice really matter? Virginia Law Review, 76, 95-111. 

Delgado, R., & Stefancic, J. (2001). Critical race theory:  An introduction.New York: New YorkUniversity Press. 

Harris, C. (1993). Whiteness as property. Harvard Law Review, 106, 1707-1791. 

Kozol, J. (1991). Savage inequalities.New York:  Basic Books. 

Ladson-Billings, G. (2006). From the achievement gap to the education debt:  Understanding achievement in U.S.schools. Educational Researcher 35(7)3-12. 

Ladson-Billings, G. (2009). Just what is critical race theory and what’s it doing in a nice field like education? In E. Taylor, D. Gillborn, & G. Ladson-Billings (Eds.), Foundations of critical race theory in education (pp. 17-36).   

Ladson-Billings, G., & Tate, W. F. IV (1995). Toward a critical race theory of education. Teachers College Record, 97(1), 47-68. 

Lawrence, C. R. (1995). The id, the ego, and equal protection:  Reckoning with unconscious racism. In K. Crenshaw, N. Gotanda, G. Peller, & K. Thomas (Eds.), Critical race theory:  The key writings that formed the movement (pp. 235-237).New York:  The New Press. 

Matsuda, M. (1995). Looking to the bottom:  Critical legal studies and reparations. In K. Crenshaw, N. Gotanda, G. Peller, & K. Thomas (Eds.), Critical race theory:  The key writings that formed the movement (pp. 63-79).New York:  The New Press. 

McIntosh, P. (1990). White privilege:  Unpacking the invisible knapsack. Independent School, Winter, 31-36.

Smaller is Better when it comes to Running Our Schools

Since the publication of A Nation at Risk, there have been numerous efforts to try to find the right mixture of ways to improve student achievement while lowering the cost of education involving five major policy making levels (i.e., federal, state, district, school and classroom/student.)  Many of these efforts have looked at the decision making process and how politics impacts that process in terms of the educational policies that result.  Using test scores as a measure of student achievement and local property taxes as a measure of the cost of education, a number of states as well as the federal government have advocated through various means for larger class sizes as well as for school consolidations.  Federal and many state governments have also advocated for the centralization of policy making at their respective levels as ways in which not only to improve student achievement but also to lower the cost of providing education. 

 

These federal and state level stakeholders whose motto might conceivably be described as “bigger is better” seem to base their belief on presumed economies-of-scale that will lead to lower operating costs and thereby lower property taxes as well as to perhaps improving test scores through the application of nationally determined standards at the state level.  One of their arguments seems to be based on the belief that having larger class sizes requires fewer teachers which in turn lowers operating costs.  In addition, larger class sizes mean fewer class rooms would be used thereby minimizing the demand for new or expanded school facilities.  Another argument advocates for school district consolidation as a way in which to achieve improved operating efficiency primarily through presumed lower administrative costs. 

 

National standards such as those imposed by the No Child Left Behind Act (NCLB) with its mandated tests are also seen as a way in which to drive the formulation of educational policy at the federal and state levels while the federal level includes an aggregation of state data.  Such national educational policy is believed to help “raise the bar” for student performance.  While NCLB is mandated by the federal government, the states force their school districts to comply with its regulations.  The NCLB test scores are used to determine adequate yearly progress (AYP) for students, schools and districts alike. 

 

But the combination of federally-determined educational policy implemented through state governments and departments of education has often resulted in decisions seemingly made more in favor of special interest groups than local schools as well as in higher costs.  Consolidating local school districts into countywide or extremely large regional districts removes decision making authority from those levels most affected by educational policy decisions:  the individual student, school and district.  It also concentrates policy formulation and decision making at centralized levels where special interests have greater leverage on the policy makers and, as a result, greater control of the policy outcomes.  Moreover, consolidation of local school districts into county level districts while fewer in number with supposedly less combined administrative expense has often resulted in higher state-wide total administrative costs due to the lack of accountability, excessive political patronage hiring at the county level and reduced local taxpayer input. 

 

Because the federal and state levels are too distant from where education actually takes place and are more easily influenced by special interest groups, accountability declines at these levels where it is needed most.  Consolidation of local school districts into county level districts also tends to result in more of a traditional military-type command-and-control decision making model.  In this Theory X model the federal level develops the strategy for policy implementation, the state governments and their departments of education translate the strategy into tactics for deployment, and the school districts are responsible for making sure that the federal and state mandates are implemented accordingly at the individual school and student level. 

 

Because countywide or regional school district consolidations lead to increased education costs, lower student achievement especially as measured by test scores and less accountability such combinations should be prevented.  Eliminating units of consolidation such as county level departments of education will not only remove an unnecessary layer of bureaucracy and cut administrative costs but also improve accountability particularly to local taxpayers as well as to parents.  Moreover, without county level departments of education or large regionalized school districts overburdening our educational systems, our schools will be better able to provide quality instruction. 

 

The majority of research on class size has demonstrated that when qualified teachers teach students in smaller class sizes, the students not only learn more but also these students retain this advantage over other students who attend larger classes.  One leading study is the longitudinal class size reduction initiative conducted over a number of years in Tennessee called the Student Teacher Achievement Ratio (STAR) project.  The STAR project demonstrated that students, who were enrolled in small classes beginning with kindergarten and continuing through third grade, were significantly more likely than their counterparts who attended larger classes, to: 

• Demonstrate better reading and mathematics skills
• Complete more advanced mathematics, science and English courses
• Complete high school 
• Graduate high school on time 
• Graduate with honors. 

 

The STAR project also found that even after the students returned to larger classes in the fourth through eighth grades those students who attended smaller class sizes for their first three or four years maintained an advantage over students who had attended the larger classes from kindergarten through third grade.  The findings of the STAR project are echoed by other projects such as Wisconsin’s Student Achievement Guarantee in Education (SAGE) project, which was a statewide initiative in Wisconsin that increased student achievement, and Indiana’s Project Prime Time.  In addition, the research demonstrates that having a smaller class size not only increases student achievement but also helps to minimize the achievement gap among different groups of students particularly among majority and minority students.  

 

“Smaller is better” and it should not be surprising that research supports this.  Having fewer students in the classroom enables the teacher to dedicate more time to each child.  Consequently, students pay more attention to class work and participate more in academics.  Because the students are more involved with their studies they learn more and behave better.  Is it any wonder then that test scores are significantly higher for students who attend small classes?   Based upon the findings of the STAR project and other studies there seems to be little doubt that students taught in small classes enjoy significant and lasting educational advantages. 

 

The greater is the shift to larger class sizes nationwide, the more teachers will probably be let go.  However, larger class sizes often lead to lower test scores and make it more difficult for students, schools and districts to achieve adequate yearly progress (AYP) as required by NCLB.  As a result, school districts are likely to be subjected to many of the more stringent penalties of NCLB.  This will further reduce the financial resources available to support quality education and contribute to a downward spiral of education nationwide.    

 

Concentrating decision making at the district level rather than at the county, state or federal level will increase accountability not only by focusing more resources on those most affected by education policy, the students, but also by enabling those who are the most intimately involved in providing education, the school districts, to provide improved instruction.  It is the districts that not only are closest to the school systems and students but also have the necessary expertise to most effectively decide how best to provide a quality education. 

 

But the greatest reduction of our state’s property tax burden would be to eliminate the unnecessary and overly expensive layer of county government (i.e., Freeholders) as the majority of states have already done.  For example, Connecticut had a system similar to the one in New Jersey in which Connecticut not only had the Freeholder level of government but also had the counties involved in the running of local schools as New Jersey does through such legislation as A4S which created the Office of the Executive County Superintendent.  Because those associated with both levels of county government, Freeholder government as well as the County Department of Education, were not only too far removed from local taxpayers but also too expensive, Connecticut’s solution to cutting property taxes while improving the resources available for education was to eliminate county government. 

 

However, there is perhaps an even greater irony within debate over how best to improve student achievement while minimizing property taxes.  The dilemma facing our schools is that while districts must comply with the requirements of unfunded and under funded county, state and federal mandates, too many school districts are forced to spend much more to meet these requirements than they receive in combined financial aid from all county, state and federal governmental sources.