Census Finds Jump in District Borrowing for School Construction

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School spending in 1991 rose more than twice as much as consumer prices, according to a U.S. Census Bureau report, which found that many districts stepped up their borrowing for school construction to take advantage of falling interest rates.

During 1991, public schools borrowed $12.8 billion for construction and renovation, a 13 percent jump over 1990. The findings, reported in "Public Education Finances: 1991,'' show the continuation of a five-year trend of rising school indebtedness.

Schools in Arizona, Illinois, Michigan, New York, Pennsylvania, and Texas led the rush to the bond market, with over $500 million of debt issued in each state for construction, renovation, and refinancing projects.

Public school debt rose from about $40 billion in 1987 to $63.7 billion in 1991.

In addition to lower interest rates, experts say, the growing population of young children and the deterioration of school buildings have fueled the facilities-spending boom. (See Education Week, March 20, 1991.)

The 1991 growth in spending on facilities outpaced overall school spending, which still increased at a much faster clip than the overall economy.

Federal, state, and local agencies spent more than $330 billion for all levels of public education in 1991, an 8 percent increase over 1990. Consumer prices crept up about 3.2 percent over the same period.

Cost Factors

Factors cited as responsible for the rising school spending include:

  • Teacher salaries. Salaries in elementary and secondary education rose by 8.7 percent, to a total of $91.3 billion, in 1991. Instructional costs jumped 4.5 percent, to $30.7 billion.
  • Support costs, including administration, maintenance, and transportation. These costs rose in elementary and secondary schools by 7 percent, to a total of $69.3 billion.
  • Increased spending at public colleges and universities, which rose about 8 percent in 1991 over the previous year, to $71 billion.

The report found that New Jersey logged the highest per-pupil costs of any state, at an average of $7,949. The District of Columbia followed with a $7,856 average. New York, Alaska, and Connecticut rounded out the top five, with each state spending more than $7,000 per student.

Utah spent the least per pupil, at $2,765. The average per-pupil spending nationwide was $4,938.

State and local governments supplied an equal share of overall school funding in 1991--47 percent each--with the federal government picking up 6 percent of the tab.

The report is available for $7 from the Superintendent of Documents, P.O. Box 371954, Pittsburgh, Pa. 15250-7954; (202)783-3238. Refer to stock number 003-024-08723-5.

Vol. 13, Issue 09

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